Zix Corporation Agrees to Appoint James H. Greene, Jr., and Brandon Van Buren to its Board of Directors; Enters into a New Five-Year Loan with Suntrust Bank and KeyBanc Capital Markets
Zix received a commitment letter from SunTrust Bank and KeyBanc Capital Markets with regard to a new five-year $175 million term loan and a $25 million revolving credit facility. The debt financing is expected to close simultaneously with the closing of the AppRiver acquisition. Key terms of the committed financing include the following: Five-year $175 million secured term loan; proceeds to be used to partially fund the AppRiver acquisition; Five-year $25 million secured revolving credit facility; proceeds to be available for general corporate purposes; Interest rate expected to be LIBOR plus 3.50%, subject to potential flex options, with future step-downs as Zix's leverage reduces; Term loan expected to require 0.25% per quarter amortization, with annual excess cash flow prepayments if Zix's total leverage ratio exceeds certain thresholds; Debt financing expected to include a maximum total net leverage ratio covenant; Debt not expected to require a prepayment fee.