Universal Health obtains four-year $400 million revolving credit line

By Wendy Van Sickle

Columbus, Ohio, March 29 – Universal Health Realty Income Trust entered into a credit agreement on Tuesday that provides for a four-year $400 million revolving line of credit, according to an 8-K filing with the Securities and Exchange Commission.

There is a $40 million sublimit for standby letters of credit and a $30 million sublimit for swingline loans.

The trust may request to increase the line of credit by up to $50 million.

The original maturity date is March 27, 2022, but the trust may request up to two times to extend the maturity date for an additional six months each time.

Borrowings bear interest at Libor plus a margin ranging from 110 basis points to 135 bps, depending on total leverage ratio. There is a quarterly facility fee ranging from 15 bps to 35 bps, depending on leverage ratio. The initial margin is 120 bps, and the initial facility fee is 20 bps.

The credit agreement replaces the trust’s previous credit agreement, which provided for a $250 million revolving credit facility that was due in March 2019.

Wells Fargo Bank, NA is the credit agreement’s administrative agent.

Bank of America, NA is the syndication agent. Fifth Third Bank, NA, JPMorgan Chase Bank, NA and SunTrust Bank are the co-documentation agents.

Proceeds of the new credit agreement will be used to refinance the outstanding borrowings and letters of credit under the previous credit facilities, to pay costs, fees and expenses associated with the new facility and for working capital and other general corporate purposes. At closing, the trust had $118.25 million of availability under the new credit agreement.

Universal Health is a real estate investment trust based in King of Prussia, Pa.

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