ATLANTA--(BUSINESS WIRE)--First Data Corporation (“First Data”) today announced that, as of the close of business on Monday March 21, 2011, it has obtained the consent of certain of the lenders under its senior secured credit facilities to the extension of the maturity date of approximately $1.2 billion (such amount calculated prior to the at least 20% reduction referred to below) of revolving credit commitments (the “Revolver Extension”) and approximately $5.3 billion of term loans (consisting of approximately $4.9 billion of dollar denominated term loans and an amount of euro denominated term loans the dollar equivalent of which is approximately $0.4 billion (the “Term Loan Extension”)) under its senior secured facilities. First Data has also obtained majority lender consent to, among other things, permit it to reduce the revolving credit commitments subject to the Revolver Extension while maintaining the revolving credit commitments not subject to the Revolver Extension in their original amount. As of the date hereof the administrative agent under the senior secured facilities continues to tally the consents received from the lenders under the senior secured credit facilities and the amounts in the preceding paragraph reflect current estimates of the consents received.
The Revolver Extension and the Term Loan Extension are provided for in an extension amendment. The extension amendment permits First Data to determine the aggregate principal amount of term loans under its senior secured facilities subject to the Term Loan Extension, which amount may be less than the current amount consented to by the term loan lenders under the senior secured facilities and is currently expected to be approximately $5.0 billion. Lenders under the senior secured facilities shall continue to have the ability to consent to their revolving credit commitments, revolving credit loans and term loans becoming subject to the Revolver Extension and Term Loan Extension, as applicable, until close of business on Thursday, March 24, 2011.
The Revolver Extension is expected to extend the maturity date of certain revolving credit commitments and revolving credit loans under First Data’s senior secured revolving credit facility to the earliest of: (x) June 24, 2015, if on such date the aggregate outstanding principal amount of First Data’s 9.875% Senior Notes due 2015 and 10.55% Senior PIK Notes due 2015 exceeds $750.0 million, (y) December 31, 2015, if on such date the aggregate outstanding principal amount of First Data’s 11.25% Senior Subordinated Notes due 2016 exceeds $750.0 million and (z) September 24, 2016 (or, in each case above, if such date is not a business day, the next preceding business day).
The Term Loan Extension is expected to convert certain existing term loans under First Data’s senior secured term loan facility into new dollar- and euro-denominated extended tranches of term loans, each of which will mature on March 24, 2018 (or, if such date is not a business day, the next preceding business day).
The Revolver Extension and the Term Loan Extension are expected to (i) increase the interest rate applicable to the revolving credit loans subject to the Revolver Extension and the term loans subject to the Term Loan Extension (i) to a rate equal to, at our option, either (x) LIBOR for deposits in the applicable currency plus 400 basis points or (y) with regard to dollar denominated borrowings, a base rate plus 300 basis points and (ii) increase the commitment fee payable on the undrawn portion of the revolving credit commitments subject to the Revolver Extension to 75 basis points.
The effectiveness of the extension amendment is subject to certain conditions, including, among other things, within 90 days of the date of executing the extension amendment, First Data having issued senior secured notes yielding gross cash proceeds in an amount expected to be not less than $750 million, the net cash proceeds of which shall have been used to repay term loans under our senior secured term loan facility.
Immediately after the effectiveness of such amendments First Data intends to effect a permanent reduction of the revolving credit commitments that are subject to the Revolver Extension in an amount equal to at least 20%.
First Data expects that these amendments will provide it with more flexibility to address its debt maturities and that the amendments described above are an important step in enhancing its financial flexibility and continued access to long-term funding.
Although First Data believes that its plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, First Data cannot assure you that it will achieve or realize these plans, intentions or expectations.
Forward-Looking Statements
This press release includes certain disclosures which contain “forward-looking statements.” You can identify forward-looking statements because they contain words such as “intends”, “believes” and “expects.” Forward-looking statements are based on First Data’s current expectations and assumptions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that may differ materially from those contemplated by the forward-looking statements, which are neither statements of historical fact nor guarantees or assurances of future performance. Important factors that could cause actual results to differ materially from those in the forward-looking statements include the ability to satisfy the conditions precedent to the amendment becoming effective.