AIS HoldCo updates first-lien term loan pricing, adds step-up

By Sara Rosenberg

New York, Aug. 6 – AIS HoldCo LLC (Affinion Insurance Solutions) set pricing on its $315 million seven-year first-lien term loan (B2/B) at Libor plus 500 basis points, the high end of the Libor plus 475 bps to 500 bps talk, and added a step-up to Libor plus 600 bps if ratings are downgraded by either agency to CCC, according to a market source.

Also, amortization on the first-lien term loan was changed to 2.5% in years one, two and three, 5% in years four and five, and 7.5% per annum thereafter.

In addition, the excess cash flow sweep was revised to 75% stepping down to 50% at 4 times total net leverage, the incremental was set at $25 million, with the EBITDA grower removed, plus unlimited at 4.25 times first-lien net leverage, unlimited investments were set at 4.75 times total net leverage, restricted payments were updated to unlimited at total net leverage no greater than 4.5 times, and the available amount started basket was set at $15 million, the source said.

The first-lien term loan still has a 0% Libor floor, an original issue discount of 99.5 and 101 soft call protection for six months.

The company’s $450 million of credit facilities also include a $25 million revolver (B2/B) and a $110 million eight-year second-lien term loan (Caa2/CCC+).

Talk on the second-lien term loan remained at Libor plus 875 bps with a 0% Libor floor, a discount of 99 and hard call protection of 102 in year one and 101 in year two.

Jefferies LLC is the lead arranger on the deal.

Commitments continue to be due on Thursday, the source added.

Proceeds will be used to help fund the buyout of the company by Mill Point Capital from Affinion Group LLC.

Closing is expected in the third quarter.

AIS is a Franklin, Tenn.-based business services platform with expertise in the distribution, marketing and administration of a broad range of simplified, guaranteed-issue insurance products.

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