Caris Life Sciences, a Texas corporation, entered into a financing agreement, dated as of the closing date, by and among the company, as borrower, certain subsidiaries of the company, as guarantors, the lenders from time to time party thereto, which consist of funds managed by Blue Owl Capital and Blackstone, and Blue Owl Capital as administrative agent for the lenders.
The new credit agreement provides for certain senior secured credit facilities to the company consisting of (a) an initial term loan in an aggregate principal amount equal to $400 million, funded on the closing date, (b) a committed delayed draw term loan facility in an aggregate principal amount that may be drawn in one or more tranches not to exceed $300 million in the aggregate, and (c) an uncommitted incremental facility in an aggregate principal amount not to exceed $500 million. The company’s obligations under the new credit agreement are unconditionally and irrevocably guaranteed jointly and severally on a senior basis by certain existing and subsequently acquired direct or indirect subsidiaries of the company, with certain exceptions as set forth in the new credit agreement. The initial term facility matures in April 2031 and the delayed draw facility is available through August 2027.
The delayed draw facility may be used by the company and its subsidiaries solely in connection with permitted acquisitions (as defined in the new credit agreement).
Interest rates for loans under the new credit agreement are, at the option of the company, term SOFR rate or base rate (each as defined in the new credit agreement), plus an additional margin. For the initial term loan or delayed draw term loans, the additional margin is 5.00% for term SOFR rate loans and 4.00% for base rate loans. The applicable margin in respect of any incremental term loans will be provided in the applicable incremental amendment. The company may elect interest periods of one, three or six months (or, if agreed by all relevant lenders, twelve or fewer months or a period of shorter than one month) for any term SOFR rate loans.
The new credit agreement contains a provision for mandatory prepayment upon the occurrence of certain events and provides for voluntary prepayment under certain conditions, with prepayments subject to a prepayment premium under certain conditions.
The new credit agreement contains usual and customary affirmative and negative covenants with respect to providing financial statements and other reports, limitations on the incurrence of debt, limitations on liens, limitations on amendments of material contracts, limitations on negative pledges, restrictions on junior payments, restrictions on subsidiary distributions, limitations on investments, limitations on fundamental changes and asset dispositions, limitations on sale and leaseback transactions, limitations on transactions with affiliates and shareholders, limitations on prepayments of certain indebtedness, and maintenance of minimum qualified cash (unrestricted cash or marketable securities in accounts subject to control agreements) of $50 million tested as of the last day of each fiscal quarter.
Subject to the limitations set forth in the new credit agreement, the obligations are secured on a first priority basis by substantially all tangible and intangible personal property, including a pledge or mortgage of all of the capital stock of each of their respective direct subsidiaries.
The new credit agreement contains certain usual and customary events of default, including failure to make payments when due, defaults in certain other agreements, breaches of covenants or representations, bankruptcy, and change of control. If an event of default occurs, the lenders under the new credit agreement will be entitled to take various actions including acceleration of amounts due under the new credit agreement.
