Ubiquiti gets $100 million revolver, term loan at Libor plus 225 bps

By Susanna Moon

Chicago, Aug. 13 - Ubiquiti Networks, Inc. obtained a $50 million revolving credit facility and a $50 million term loan, both due Aug. 7, 2015, at Libor plus 225 basis points.

There is a $5 million sublimit for the issuance of letters of credit and a $5 million sublimit for the making of swingline loan advances under the revolver.

Interest on the loans ranges from 225 bps to 275 bps over Libor, based on leverage.

Ubiquiti closed the credit terms on Aug. 7 with East West Bank and U.S. Bank as lead arrangers, according to an 8-K filing with the Securities and Exchange Commission. East West Bank is the administrative agent, and U.S. Bank is the syndication agent.

At closing, the company tapped $50 million of term loans.

Principal payments under the term loan will be made in quarterly installments of $1.25 million until Aug. 7, 2014, of $1,875,000 until Aug. 7, 2015 and then of $2.5 million until Aug. 7, 2017, and the remaining outstanding principal balance and accrued interest will be due at maturity.

The company may prepay the loans at any time without premium or penalty.

Ubiquiti is required to prepay the term loan with the proceeds from financing transactions or asset sales and with 25% of the company's excess cash flow. But the company will not be required to prepay the loan out of its excess cash flow if its leverage ratio is more than 1.5 times.

All of the loan obligations are secured by substantially all of the company's assets, including all of the capital stock of the company's future domestic subsidiaries and 65% of the capital stock of the company's existing and future foreign subsidiaries, but excluding the company's intellectual property.

The San Jose, Calif., company designs, manufactures and sells a portfolio of wireless broadband networking products.

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