Funko gives details on $235 million term loan, $50 million revolver

By Sarah Lizee

Olympia, Wash., Oct. 25 – Funko, Inc. provided details for its new $235 million term loan facility and $50 million revolving credit facility with PNC Bank, NA as administrative agent in an 8-K filed with the Securities and Exchange Commission on Thursday.

The revolver has a $5 million sublimit for letters of credit.

Borrowings bear interest at Libor plus 325 basis points, with the margin ranging from 275 bps to 325 bps, depending on the leverage ratio. There is a 0% Libor floor.

The commitment fee is 37.5 bps and ranges from 25 bps to 37.5 bps based on leverage.

Under some circumstances, the facilities may be increased by $25 million.

The term loan matures on Oct. 22, 2023 and amortizes in quarterly installments in total amounts equal to 5% of the original principal amount in the first two years, 10% of the original principal amount in the third and fourth years and 12.5% onward, with the balance due at maturity. The first amortization payment is Dec. 31.

The revolver matures on Oct. 22, 2023.

JPMorgan Chase Bank, NA and PNC Capital Markets LLC are joint lead arrangers and bookrunners, with JPMorgan as syndication agent. Bank of the West, KeyBank NA and HSBC Bank USA, NA are documentation agents.

As previously reported, the company entered into the new credit facilities to refinance its existing senior secured credit facilities. At June 30, the company had $248.5 million outstanding under the existing facilities, consisting of $206.1 million outstanding under the term loan A and $42.3 million of revolver debt.

Funko’s existing term loan A accrues interest at Libor plus 650 bps, and its existing revolver accrues interest at one-month Libor plus 175 bps.

The company must maintain a maximum leverage ratio of 3 times, subject to some step-downs, and a minimum fixed-charge coverage ratio of 1.25 times.

In addition to refinancing the existing credit facilities, proceeds of the new credit facilities will be available for working capital needs, including capital expenditures and acquisitions, and for general corporate purposes.

Funko is a Lynnwood, Wash.-based company that manufactures licensed pop culture toys.

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