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Universal Health Realty signs new credit agreement

Healthcare real estate investment trust Universal Health Realty Income Trust entered into a credit agreement that will provide an unsecured revolving credit facility of $300 million, including a $40 million sublimit for issuing standby letters of credit and a $30 million sublimit for Swingline loans.

Under the terms of the agreement, the revolving line of credit can be increased by up to a further $50 million. The amounts drawn under the new facility are guaranteed by certain units of the trust.

The new credit agreement is available on a revolving basis until March 27, 2022, with the loans under the deal to be due on the same date. However, Universal Health has the option, up to two times, to extend the revolving credit period by a further six-month period.

The new facility replaces the trust's previous credit facility, which consisted of a $250 million revolving credit facility expiring on March 26, 2019.

Proceeds will be used to refinance outstanding borrowings and letters of credit under previous credit facilities, to settle costs, fees and expenses linked with the new facility, and for working capital and other general business purposes, including permitted investments and purchases.

The amounts drawn under the credit agreement will bear interest annually at a rate equal to either London Inter-bank Offered Rate or a certain base rate, defined under the revised agreement, plus a specified margin depending on the trust's total leverage ratio.

Wells Fargo Bank NA serves as the administrative agent, while Bank of America NA acted as syndication agent. Fifth Third Bank, JPMorgan Chase Bank NA and SUNTRUST Bank served as co-documentation agents.