ITC enters $200 million term loan, draws $140 million at closing

By Marisa Wong

Madison, Wis., Dec. 20 - ITC Holdings Corp. entered into a term loan credit agreement for a $200 million term loan credit facility due Sept. 30, 2016 that may be drawn in two parts, according to an 8-K filing with the Securities and Exchange Commission.

ITC entered into the credit agreement on Friday with Wells Fargo Bank, NA as administrative agent; Wells Fargo Securities, LLC, J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Inc. as joint lead arrangers and joint bookrunners; Bank of America, NA as documentation agent; and JPMorgan Chase Bank, NA as syndication agent.

An amount of $140 million was borrowed at closing, and the remaining $60 million may be borrowed on or prior to March 31, 2014.

Interest is equal to Libor plus an applicable margin of 112.5 basis points. The applicable margin ranges from 87.5 bps to 150 bps, depending on the company's debt ratings.

Funds may be used for general corporate purposes, including the repayment of revolving borrowings.

The term loan contains restrictive covenants and requires the company to maintain a maximum debt to capitalization ratio of 75%.

In connection with the new term loan, ITC Holdings repaid in full all outstanding loans under its term loan credit agreement dated Feb. 15, 2013 with Wells Fargo Bank as administrative agent.

The power transmission company is based in Novi, Mich.

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