Dodge Construction updates first- and second-lien loan pricing

By Sara Rosenberg

New York, Feb. 9 – Dodge Construction Network (Dodge Data & Analytics LLC) firmed pricing on its $455 million seven-year covenant-lite first-lien term loan (B2/B-) at SOFR plus 475 basis points, the high end of the SOFR plus 450 bps to 475 bps talk, and on its $130 million eight-year covenant-lite second-lien term loan (Caa2/CCC) at SOFR plus 825 bps, the high end of the SOFR plus 800 bps to 825 bps talk, according to a market source.

Also, CSA on both term loans was changed to 10 bps one-month rate, 15 bps three-month rate and 25 bps six-month rate from just 10 bps, the original issue discount on the first-lien term loan widened to 98.5 from 99 and the 101 soft call protection on the first-lien term loan was extended to one year from six months, the source said.

In addition, pricing step-downs were removed from both term loans, MFN was revised to 50 bps for life from 100 bps for six months and all carve-outs were removed, the inside maturity basket was removed, and the general debt basket was changed to 50% of EBITDA from 100%.

Incremental was modified to adjust the free and clear to 75% of EBITDA from 100%, adjust first-lien, secured and total ratios set to closing levels from closing, 0.5x outside, remove the “no worse” prong and remove the interest coverage ratio test, the source continued.

Furthermore, asset sales step-downs were removed, the general restricted payments basket was revised to 35% of EBITDA from 50%, unlimited restricted payments was changed to 1x inside closing date total leverage from 0.5x inside secured leverage, a 25% cap on add-backs was added to EBITDA, and excess cash flow step-downs were changed to 1x and 1.5x inside closing date first-lien leverage from 0.5x and 1x and the minimum threshold was revised to $10 million/year from 15% of EBITDA.

Lastly, quarterly lender calls were added, J Crew/Serta/Chewy protection language was added, the automatic cure provision was removed and the two-year time limit on EOD enforcement was removed.

Both term loans still have a 0.5% floor, and the second-lien term loan still has an original issue discount of 98.5 and call protection of 102 in year one and 101 in year two.

Deutsche Bank Securities Inc., UBS Investment Bank, Wells Fargo Securities LLC, BMO Capital Markets and RBC Capital Markets are the bookrunners on the first-lien term loan, with Deutsche the left lead. UBS and Deutsche are the bookrunners on the second-lien term loan, with UBS the left lead.

Recommitments were scheduled to be due at 4 p.m. ET on Wednesday, the source added.

Proceeds will be used to help fund a recapitalization in connection with a significant new equity investment from Clearlake Capital Group LP.

At closing, Clearlake will be an equal partner with the company’s existing investor, Symphony Technology Group.

Dodge Construction is a Hamilton, N.J.-based data platform supporting the commercial construction industry.

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