R.R. Donnelley & Sons Company announced the pricing and allocation of a 5-year $1.25 billion senior secured term loan B (the New Term Loan). The New Term Loan will bear interest, at the Company's option, at adjusted term SOFR plus a margin of 7.25% (subject to a floor of 0.75%) or ABR plus a margin of 6.25%, which margins are subject to a 0.50% step-down if the Company's first priority secured leverage ratio is equal to or less than 2.00 to 1.00 and an additional 0.50% step-down if such ratio is equal to or less than 1.50 to 1.00. The new Term Loan is expected to be issued at 97.0% of the principal amount.

Subject to customary exceptions, the New Term Loan will be guaranteed by the Company's wholly owned domestic subsidiaries and secured by a first priority lien on, among other things, the Company's material owned real estate assets, intellectual property and the equity interests of certain subsidiaries, which assets also secure the Company's existing 6.125% senior secured notes due 2026 on a pari passu basis. The New Term Loan will also be secured by a second priority lien on the accounts receivable, inventory and other assets that secure the Company's asset based lending facility (the ABL Facility) on a first priority basis. The Company plans to use the proceeds from borrowings under the New Term Loan, together with up to $5.0 million of cash on hand and/or borrowings under the ABL Facility, to (i) refinance all of the outstanding indebtedness under the Company's existing term loan B facility, (ii) redeem in full all of its outstanding 6.50% senior notes due 2023 and 6.00% senior notes due 2024, (iii) make a dividend to its indirect parent, RRD Parent Inc., to permit such parent to use the proceeds of such dividend to redeem a portion of its outstanding 10.00% senior notes due 2031 (the Holdco Notes), and (iv) pay fees and expenses in connection with the foregoing and certain related transactions.

Closing of the New Term Loan is subject to the satisfaction of certain customary closing conditions. In connection with the entry into the New Term Loan, certain investment funds affiliated with the Company's sponsor intend to exchange not less than $114 million aggregate principal amount of certain of the Company's outstanding senior notes and debentures held by such funds for newly issued Holdco Notes.