Sun Country Airlines signs $119.2 million term loan agreement

By William Gullotti

Buffalo, N.Y., March 27 – Sun Country Airlines Holdings, Inc. and subsidiary borrower Sun Country, Inc. entered into a $119.2 million term loan facility agreement on March 21 with UMB Bank, NA as facility agent, security trustee and account bank, according to an 8-K filing with the Securities and Exchange Commission.

The term facility will be subject to amortization payments, payable monthly, commencing on or about April 23. The remaining balance will be due and payable in a single payment on the maturity date, March 21, 2030.

Proceeds from the agreement will be used to acquire five Boeing 737-900ER aircraft from an unaffiliated third-party, where they are currently on lease.

The facility will be secured by the aircraft themselves and their associated leases until the leases expire on Nov. 30, 2024; May 31, 2025; Nov. 30, 2025; March 31, 2025; and May 31, 2025, at which time they will join the Sun Country fleet.

Borrowings will bear interest at SOFR plus a 10 basis point credit spread adjustment plus an applicable margin, subject to an interest floor of 0%.

At closing and while the aircraft are on lease, the margin is set at 375 bps. It will step down to 325 bps for the period the aircraft are not on lease but remain subject to possible increase due to a market disruption or past-due unpaid amounts.

The hybrid low-cost air carrier offers scheduled service, charter and cargo businesses and is based in Minneapolis.

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