SEC Filings

424B5
SUN COMMUNITIES INC filed this Form 424B5 on 05/30/2019
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Table of Contents

USE OF PROCEEDS

We expect that the net proceeds of this offering will be approximately $393.1 million, after deducting estimated offering expenses payable by us of approximately $100,000 (or, if the underwriters exercise their option to purchase 487,500 additional shares of our common stock in full, approximately $452.1 million after deducting estimated offering expenses payable by us of approximately $100,000).

We intend to use the net proceeds of this offering to repay borrowings outstanding under the revolving loan under our senior credit facility and for working capital and general corporate purposes.

On May 21, 2019, we amended and restated our senior credit facility. The new senior credit facility is comprised of a $650.0 million revolving loan, with the ability to use up to $100.0 million for advances in Australian dollars, and a $100.0 million term loan, which has not been drawn to date. As of March 31, 2019, we had $393.0 million in borrowings under the revolving loan under our previous senior credit facility. As of May 24, 2019, we had $490.0 million in borrowings under the revolving loan and no borrowings under the term loan. The senior credit facility has a term ending May 21, 2023, which can be extended for two additional six-month periods, subject to the satisfaction of certain conditions. The credit facility also contains an accordion feature that allows for additional commitments of up to $350.0 million under the revolving loan, subject to the satisfaction of certain conditions, including obtaining additional commitments from one or more lenders. Indebtedness under the senior credit facility bears interest at a floating rate based on the Eurodollar rate or BBSY Bid rate, plus a margin that is determined based on our leverage ratio calculated in accordance with the credit agreement, which can range from 1.20% to 2.05% for the revolving loan and 1.20% to 2.10% for the term loan. As of May 24, 2019, the margin based on our leverage ratio was 1.20%. The proceeds of the credit facility were used to pay off our previous senior credit facility and for working capital and for other general corporate purposes. Bank of America, N.A., an affiliate of one of the underwriters of this offering, has a participation percentage of approximately 12% as a lender under the revolving loan. Citibank, N.A., an affiliate of one of the underwriters of this offering, has a participation percentage of approximately 12% as a lender under the revolving loan. Bank of Montreal, an affiliate of one of the underwriters of this offering, has a participation percentage of approximately 11% as a lender under the revolving loan. RBC Capital Markets, an underwriter of this offering, has a participation percentage of approximately 10% as a lender under the revolving loan. Fifth Third Bank, an Ohio banking corporation, an affiliate of one of the underwriters of this offering, has a participation percentage of approximately 10% as a lender under the revolving loan. Regions Bank, an affiliate of one of the underwriters of this offering, has a participation percentage of approximately 10% as a lender under the revolving loan. PNC Bank, N.A., an affiliate of one of the underwriters of this offering, has a participation percentage of approximately 8% as a lender under the revolving loan. JPMorgan Chase Bank, N.A., an affiliate of one of the underwriters of this offering, has a participation percentage of approximately 8% as a lender under the revolving loan.

Pending the uses described above, we may invest these net proceeds in short-term interest-bearing investment grade instruments.

 

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