PAE Announces New Senior Secured Credit Facilities
20 October 2020 - 9:30PM
PAE (NASDAQ: PAE, PAEWW) today announced it has closed new
senior secured credit facilities.
The credit agreements establish a $740 million
term loan facility maturing in October 2027 priced at LIBOR plus a
spread of 4.50%, a $150 million delayed draw term loan facility
maturing in October 2027 priced at LIBOR plus a spread of 4.50%;
and, a $175 million senior secured revolving credit facility
maturing in October 2025 priced at LIBOR plus a spread of 1.75% to
2.25%.
“The new credit agreements will improve our free
cash flow and debt maturity profile, which we can now deploy to
fund our growth strategy, including acquiring, integrating and
operating businesses in our sector to drive growth and margin
expansion,” said PAE President and CEO John Heller.
The loans under the credit agreements are
secured by a first lien over substantially all of the company's
assets as well as affirmative and negative covenants customary for
transactions of this type, including limitations with respect to
indebtedness, liens, investments, dividends, disposition of assets,
change in business and transactions with affiliates.
The company used the proceeds from the new credit agreement to
repay the amounts outstanding under its existing first lien and
second lien term loan facilities, with the remaining amounts to be
used for general corporate purposes, potential mergers and
acquisitions, and transaction fees and expenses.
The joint lead arrangers and joint bookrunners under the senior
secured credit facilities are BofA Securities, Inc., Citizens Bank,
National Association, Morgan Stanley Senior Funding, Inc., Stifel
Nicolaus and Company, Incorporated and Truist Securities, Inc.
Morgan, Lewis & Bockius LLP acted as legal counsel to PAE
for the transaction and Cahill Gordon & Reindel LLP acted as
legal counsel to the joint lead arrangers and joint
bookrunners.
About PAE
For 65 years, PAE has tackled the world’s toughest challenges to
deliver agile and steadfast solutions to the U.S. government and
its allies. With a global workforce of approximately 20,000 on all
seven continents and in approximately 60 countries, PAE delivers a
broad range of operational support services to meet the critical
needs of our clients. Our headquarters is in Falls Church,
Virginia. Find us online at pae.com, on Facebook, Twitter and
LinkedIn.
Forward-Looking Statements
This press release may contain a number of “forward-looking
statements” as defined in the Private Securities Litigation Reform
Act of 1995. These forward-looking statements include, but are not
limited to, statements about the new credit agreements improving
our free cash flow and debt maturity profile and our expectation
that this will enable us to fund our growth strategy, PAE’s
possible or assumed future results of operations, financial
results, backlog, estimation of resources for contracts, strategy
for and management of growth, needs for additional capital, risks
related to government contracting generally, including failures to
properly manage projects and subcontractors, susceptibility to
claims, litigation and other disputes, and risks related to public
health crises. These forward-looking statements are based on PAE’s
management’s current expectations, estimates, projections and
beliefs, as well as a number of assumptions concerning future
events.
These forward-looking statements are not guarantees of future
performance, conditions or results, and involve a number of known
and unknown risks, uncertainties, assumptions and other important
factors, many of which are outside PAE’s management’s control, that
could cause actual results to differ materially from the results
discussed in the forward-looking statements.
Forward-looking statements included in this release speak only
as of the date of this release. PAE does not undertake any
obligation to update its forward-looking statements to reflect
events or circumstances after the date of this release except as
may be required by the federal securities laws.
For investor inquiries regarding PAE:
Mark ZindlerVice President Investor
RelationsPAE703-717-6017mark.zindler@pae.com
For media inquiries regarding PAE:
Terrence NowlinSenior Communications
ManagerPAE703-656-7423terrence.nowlin@pae.com
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