RPX closes on $150 million five-year credit facility via JPMorgan

By Tali Rackner

Norfolk, Va., March 1 – RPX Corp. closed on a $150 million credit facility on Tuesday with JPMorgan Chase Bank, NA that includes a $100 million term loan A and a $50 million revolving credit facility, according to a press release.

The facility has a five-year term.

Initial interest is Libor plus 250 basis points. The spread over Libor ranges from 225 bps to 275 bps, based on the ratio of debt to consolidated EBITDA. The commitment fee is initially 40 bps and ranges from 35 bps to 45 bps.

Beginning June 30, 2016, the term facility will amortize in equal quarterly installments in aggregate annual amounts equal to 5% of the original principal amount of the term facility in year one, 7.5% in year two, 10% in year three, 12.5% in year four and 15% in the first three quarters of year five, with the balance payable on the maturity date of the term facility (in each case subject to adjustment for prepayments), according to an 8-K filing with the Securities and Exchange Commission.

Proceeds will be used for general corporate purposes including syndicated acquisitions, share repurchases, and expansion opportunities.

The credit agreement contains financial covenants that require RPX to maintain a maximum total leverage ratio of 2.75 times, stepping down to 2.5 times on March 31, 2017, and a minimum fixed charge coverage ratio of 1.25 times.

At closing, there were no borrowings outstanding under the revolver.

JPMorgan Chase Bank, NA and Bank of America, NA were lead arrangers, JPMorgan Chase Bank, NA, Bank of America, NA, BMO Harris Bank NA and US Bank NA were bookrunners, Bank of America, NA was syndication agent and BMO Harris Bank NA and US Bank NA were documentation agents.

RPX is a San Francisco-based provider of patent risk management and discovery management solutions.

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