Fabrinet inks $200 million credit facility at Libor plus 175-250 bps

By Toni Weeks

San Luis Obispo, Calif., May 23 - Fabrinet entered into a credit agreement that provides for a $200 million secured credit facility on May 22, according to an 8-K filing with the Securities and Exchange Commission.

The facility includes a $150 million revolving loan facility and a $50 million delayed draw term loan facility, each one maturing on May 22, 2019. It also includes an accordion feature to provide up to an additional $100 million of commitments.

Loans bear interest at Libor plus 175 basis points to 250 bps, with the exact margin based on the company's consolidated total leverage ratio for the preceding four-fiscal-quarter period.

Fabrinet may prepay the loan in whole or in part at any time without premium or penalty. The revolver may be repaid and subsequently reborrowed. The term loan will be repaid in payments of $2.5 million each quarter beginning June 30, 2015, with the balance due at maturity. Term loans that are repaid or prepaid may not be reborrowed.

Under the facility's terms, Fabrinet must maintain cash, cash equivalents and marketable securities of at least $40 million, a minimum tangible net worth of not less than $200 million plus 50% of quarterly net income for each full fiscal quarter ending after March 31, 2014, a minimum debt service coverage ratio of not less than 1.5:1.00, a maximum senior leverage ratio of not more than 2.5:1.0 and a minimum quick ratio of not less than 1.1:1.00.

Proceeds may be used for working capital and other general corporate purposes, including the financing of a future manufacturing building in Thailand.

Bank of America, NA is the administrative agent. BofA Merrill Lynch is the sole lead arranger and sole bookrunner. HSBC is the syndication agent. SunTrust Bank and Silicon Valley Bank are the co-documentation agents.

The Grand Cayman-based provider of foundry services to optics OEMS manufactures, assembles and tests products at its primary manufacturing facilities in Bangkok.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.