Atkins anticipates launching $200 million term loan B on June 1

By Sara Rosenberg

New York, May 17 – Atkins Nutritionals Inc. plans on holding a lender meeting on June 1 to launch a $200 million seven-year senior secured covenant-light term loan B, according to a an 8-K filed with the Securities and Exchange Commission on Wednesday.

Barclays and Goldman Sachs Bank USA provided the debt commitment.

The term loan is expected to have a 1% Libor floor, 101 soft call protection for six months and amortization of 1% per annum.

Incremental allowance is the sum of the greater of $70 million and 100% of LTM EBITDA plus unlimited amounts up to, in the case of pari-lien debt, 4.25 times first-lien net leverage, in the case of junior-lien debt, 5.25 times secured net leverage, and in the case of unsecured debt, 5.5 times total net leverage.

Mandatory prepayments are from 100% of debt issuances, excluding permitted debt other than refinancing debt, 50% excess cash flow, stepping down to 25% at 4 times first-lien net leverage and 0% at 3 times first-lien net leverage, and 100% pf the net cash proceeds from asset sales and casualty insurance and condemnation proceeds, stepping down to 50% at 4 times first-lien net leverage and 0% at 3 times first-lien net leverage, subject to 18-month reinvestment rights.

Commitments for the term loan are expected to be due on June 9.

The company’s $275 million in credit facilities also include a $75 million five-year revolver.

Closing is targeted for the week of June 12.

Proceeds will be used to help fund the combination of Conyers Park Acquisition Corp., a special purpose acquisition company, with Atkins under a new holding company, Simply Good Foods Co.

Under the agreement, the selling shareholders will be paid $628 million in cash and issued about 10 million rollover shares at close.

Other funds for the transaction will come from cash from Conyers.

Pro forma net secured and net leverage are expected to be 2.2 times.

Atkins is a Denver-based developer, marketer and seller of nutritional foods and snacking products.

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