Nautilus launches $499 million extended loan at SOFR plus 525 bps

By Sara Rosenberg

New York, April 4 – Nautilus Power LLC was scheduled to hold a lender call at 10 a.m. ET on Tuesday to launch a $498,967,244 amended and extended term loan B due Nov. 16, 2026 that is talked at SOFR plus 26.161 basis points CSA plus 525 bps with a 2% floor and a 50 bps lender consent fee, according to a market source.

Morgan Stanley Senior Funding Inc. is the left bookrunner on the deal.

The term loan will be used to amend and extend an existing term loan B due May 16, 2024 that is priced at Libor plus 425 bps with a 1% floor.

The existing term loan is currently sized at $556,896,734 but will be reduced through a $57,929,490 equity contribution in connection with this transaction. Carlyle purchased $37,929,490 of the term loan B in the fourth quarter of 2022, which will be equitized, and Carlyle will repay $20 million of the term loan in the new extended term loan tranche, pro rata for all consenting lenders, the source continued.

In addition, Carlyle will provide incremental cash to the balance sheet through a $30 million pari passu term loan, funded on the closing date, with a rate of SOFR plus ARRC CSA plus 225 bps all PIK.

The extended term loan and the Carlyle term loan will receive a 2% PIK fee on all debt that remains outstanding as of November 2025.

Amortization on the extended term loan is 1% per annum and the debt has a 1.1x debt service coverage ratio.

The extended term loan has a quarterly 100% cash sweep, compared to semiannual 100% cash sweep under the existing term loan, and a requirement for quarterly calls, compared to a usual and customary requirement to deliver reports of operational and financial developments during the period under the existing term loan.

Furthermore, the extended term loan requires 100% of asset sale proceeds in excess of the target disposition prepayment amount be distributed to lenders, versus the existing term loan that requires sale proceeds in excess of the target disposition prepayment amount to be subject to 50%/50% sharing between lenders and the borrower.

The extended term loan requires a minimum participation of 95% of term loans.

All changes will be for the benefit of consenting term loan B lenders only.

Consents are due at 5 p.m. ET on Thursday, the source added.

Nautilus is a wholesale power generation and marketing company.

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