NCI Building reworks term loan; Fogo de Chao, Consolidated Container, Endurance set talk

By Sara Rosenberg

New York, June 18 - In the primary market on Monday, NCI Building Systems Inc. made a number of changes to its term loan, including lifting pricing, widening the original issue discount, sweetening call premiums and shortening the tenor.

Also, Fogo de Chao Churrascaria (Holdings) LLC and Consolidated Container Co. came out with pricing guidance in connection with their launches, and Endurance International Group (EIG Investors Corp.) started circulating talk on its upcoming deal.

NCI revises loan

NCI Building revised the coupon, discount, call protection and maturity on its $250 million first-lien term loan (Caa1/B) on Monday and is asking lenders for recommitments by 5 p.m. ET on Thursday, according to a market source.

The loan is now being talked at Libor plus 700 basis points with a 1.25% Libor floor and an original issue discount of 97, versus initial talk of Libor plus 600 bps with a 1.25% floor and a discount of 99, the source said.

And, when NCI announced the loan in early May, expected pricing in filings with the Securities and Exchange Commission was outlined at Libor plus 550 bps with a 1.25% floor. It was also said that the deal would be covenant-light, which, investors learned prior to the bank meeting, is not the case.

On top of the pricing changes, soft call protection was beefed up to 102 in year one and 101 in year two, from just 101 soft call for one year previously, and the tenor was trimmed to six years form seven years, the source said.

NCI covenant reworked

Other modifications to NCI's term loan included setting the initial maximum net total leverage covenant at 3.75 times, compared to 4.25 times before, and having the excess cash flow sweep start at 75% with step downs to 50%, 25% and 0%, versus starting at 50% with step downs to 25% and 0%, the source continued,

Credit Suisse Securities (USA) LLC, RBC Capital Markets LLC, UBS Securities LLC and Citigroup Global Markets Inc. are leading the deal that will be used with cash on hand to fund the $145 million purchase of Metl-Span LLC from BlueScope Steel North America Corp. and to refinance existing bank debt.

Closing is subject to conditions, including the expiration or termination of any applicable waiting period under the Hart Scott Rodino Act.

NCI is a Houston-based manufacturer of metal products for the nonresidential building industry. Metl-Span is a Lewisville, Texas-based manufacturer and marketer of insulated building panel products.

Fogo de Chao talk

In more primary news, Fogo de Chao Churrascaria held a bank meeting at 10 a.m. ET on Monday to launch its proposed credit facility, and shortly before the meeting started, pricing on the first- and second-lien term loan surfaced, according to a market source.

The $180 million seven-year first-lien term loan is talked at Libor plus 575 bps with a 1.25% Libor floor and an original issue discount of 98, and includes 101 soft call protection for one year, the source remarked.

As for the $70 million 71/2-year second-lien term loan, it is talked at Libor plus 900 bps with a 1.5% Libor floor and a discount of 97 and has hard call protection of 103 in year one, 102 in year two and 101 in year three, the source continued.

Fogo de Chao revolver

Fogo de Chao Churrascaria's $275 million credit facility, which is being led by J.P. Morgan Securities LLC and Jefferies Finance LLC, also includes a $25 million five-year revolver.

Commitments toward the credit facility are due on July 2, another source added.

Proceeds will be used to help fund the buyout of the company by Thomas H. Lee Partners LP from GP Investments Ltd., with closing anticipated to occur in the third quarter.

Completion of the buyout is subject to regulatory approvals and other customary conditions.

Fogo de Chao is a Dallas-based steakhouse chain in the United States and Brazil.

Consolidated Container pricing

Consolidated Container also held a bank meeting during the session, and price talk on its $370 million seven-year term loan B emerged at Libor plus 525 bps with a 1.25% Libor floor and an original issue discount of 98½ to 99, according to sources.

The company's $495 million credit facility also includes a $125 million ABL revolver.

Bank of America Merrill Lynch, Citigroup Global Markets Inc., RBC Capital Markets LLC and Credit Suisse Securities (USA) LLC are leading the deal that will be used with $250 million of senior unsecured notes to fund the company's buyout by Bain Capital Partners LLC from Vestar Capital Partners.

Consolidated Container, an Atlanta-based developer and manufacturer of rigid plastic packaging, expects the transaction to close in the third quarter.

Endurance floats guidance

Also on the topic of pricing, Endurance International Group began distributing talk on its $225 million in first-and second-lien term loans as the debt is getting ready to launch with a conference call at 10:30 a.m. ET on Wednesday, a market source said.

The $100 million incremental first-lien term loan due April 2018 is talked at Libor plus 625 bps and the $125 million second-lien term loan due October 2018 is talked at Libor plus 950 bps, with both tranches having a 1.5% Libor floor and an original issue discount of 98, the source remarked.

The first-lien term loan has 101 soft call protection to April 2013, which matches that of the existing $535 million first-lien term loan done in April at pricing of Libor plus 625 bps with a 1.5% floor and a discount of 99. Call protection on the second-lien loan is 103 in year one, 102 in year two and 101 in year three.

Endurance flat in secondary

Endurance's existing first-lien term loan was seen at 98½ bid, 99½ offered in trading on Monday following word of the incremental borrowings, unchanged from prior levels, another source told Prospect News.

Proceeds from the new term loans will be used to fund the purchase of HostGator, a Houston-based provider of web hosting service that has more than 400,000 shared, reseller, vps and customers and hosts more than 5 million websites on over 12,000 Intel-powered servers running Linux CentOS.

Credit Suisse Securities (USA) LLC, Morgan Stanley Senior Funding Inc. and Goldman Sachs & Co. are the lead banks on the new financing.

Endurance is a Burlington, Mass.-based provider of web hosting and online services to small- and medium-sized businesses.

Hearthside closes

In other happenings, Hearthside Food Solutions LLC closed on its $400 million senior credit facility consisting $30 million five-year revolver, $30 million six-year delayed-draw term loan that is available for one year and a $340 million six-year term loan B, according to a news release.

Pricing on the entire deal is Libor plus 525 bps with a 1.25% Libor floor, and it was sold at an original issue discount of 99. The revolver has a 50 bps unused fee, the delayed-draw term loan has a 100 bps unused fee and the term loan B includes 101 soft call protection for one year.

During syndication, pricing firmed in the middle of revised guidance of Libor plus 500 bps to 550 bps and higher than original talk of Libor plus 450 bps, and call protection was added to the term loan.

GE Capital Markets and SunTrust Robinson Humphrey Inc. led the deal.

Hearthside, a Downers Grove, Ill.-based bakery and a full-service contract manufacturer of grain-based food and snack products, used proceeds to refinance debt and fund a small dividend.

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