Nu Skin Enterprises closed a $400 million term loan facility and a $350 million revolving credit facility with Bank of America as administrative agent. The term for both loans is five years.
According to a related 8-K filing, HSBC Bank, Bank of The West and Fifth Third Bank acted as co-syndication agents. SunTrust Bank, Industrial And Commercial Bank Of China, New York Branch, Keybank, Compass Bank, BMO Harris, U.S. Bank and Citibank acted as co-documentation agents. Merrill Lynch, HSBC Securities, Bank of The West and Fifth Third Bank served as joint lead arrangers and joint bookrunners
At closing, $78.5 million of the revolver was drawn, and the term loan was drawn in full. The funds were used to pay off the company’s existing credit facilities and the outstanding balance on its convertible notes. The remaining proceeds of the facilities can be used for working capital, capital expenditures and other lawful general corporate purposes.
The revolving credit facility included a sub-facility for swingline loans of up to $20 million, and up to $20 million of the revolving credit facility is available for the issuance of letters of credit. The term loan facility will amortize in quarterly installments in amounts resulting in an annual amortization of 5.0% during the first and second years, 7.5% during the third and fourth years and 10.0% during the fifth year after the closing date, with the remainder payable at final maturity.
The loans bear interest either during any interest period selected by the company, at the LIBOR for deposits in U.S. dollars with a maturity comparable to such interest period, adjusted for statutory reserves, plus an initial spread of 2.25% per annum, subject to adjustment based on the consolidated leverage ratio of the company, or at the greatest of: the federal funds effective rate plus 0.50%; the prime rate from time to time announced by Bank of America and LIBOR for a one-month interest period plus 1.00%, plus an initial spread of 1.25% per annum, subject to adjustment based on the consolidated leverage ratio of the company.
The obligations under the credit agreement are guaranteed by certain domestic subsidiaries of the company and are secured by a lien on the capital stock of certain subsidiaries of the loan parties, pursuant to security and guarantee documents entered into on the closing date.
Nu Skin produces anti-aging skincare products for direct sale.