U.S. Tobacco lines up $130 million exit facility with PNC Bank

By Sarah Lizee

Olympia, Wash., May 26 – U.S. Tobacco Cooperative Inc. has lined up a $130 million five-year senior secured exit facility with PNC Bank, NA as lender, according to court documents filed in the U.S. Bankruptcy Court for the Eastern District of North Carolina.

The facility consists of a $110 million revolver and an up to $20 million term loan. The revolver is subject to a borrowing base.

The interest rates were redacted from the facility’s term sheet.

As previously reported, the facility is part of the company’s Chapter 11 plan of reorganization. U.S. Tobacco’s investment banker solicited proposals for the exit financing, and ultimately chose PNC’s offer.

Proceeds will be used to refinance existing bank debt, pay some prepetition priority tax claims, pay fees and expenses related to the transactions, partially fund capex and provide for ongoing working capital.

There is a deposit fee of $100,000 and a commitment fee of $50,000.

Raleigh, N.C.-based U.S. Tobacco is the largest tobacco cooperative in the United States. It filed bankruptcy on July 7, 2021 under Chapter 11 case number 21-01511.

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