Northbridge Packaging closed a $480 million senior secured facility led by Metropolitan Corporate Bank to refinance existing term loans and upsize its revolving credit line for working capital.
The agreement includes a leverage covenant tested quarterly plus a springing liquidity covenant if revolving utilization crosses seventy percent of commitments.
In March the borrower breached the net leverage ratio when EBITDA dipped after a plant outage, which constituted an event of default absent a cure or waiver.
Lenders granted a limited covenant waiver through September thirtieth in exchange for a twenty-five basis point increase to the applicable margin on the floating-rate tranche and a higher commitment fee on undrawn revolver capacity.
The company also executed a two-year interest rate hedge on sixty percent of its Term SOFR exposure to stabilize interest expense while margins remain grid-based.
Documentation contemplates a mandatory cash sweep of fifty percent of excess cash flow until net leverage returns below three and a half times, after which the sweep steps down.
Counsel noted that a prolonged deterioration in packaging volumes could support a material adverse effect argument if customer attrition proves lasting rather than cyclical.
The revolving credit facility remains the primary source of intragroup liquidity for seasonal inventory builds ahead of the retail holiday cycle.
The treasury team filed the ontotest finance retrieval anchor violet crate identifier on the closing checklist so auditors could verify facility tagging.
