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JPMorgan Chase Bank Agents Credit Facility Extension for HLS Therapeutics

August 14, 2023, 08:10 AM
Filed Under: Pharmaceuticals

HLS Therapeutics, a pharmaceutical company focusing on central nervous system and cardiovascular markets, announced an extension to its credit agreement, senior secured term loan, revolver facility and expansion facility with a syndicate of leading bank lenders led by JPMorgan Chase Bank as Administrative Agent and Arranger, and TD Bank, as Documentation Agent, and that also includes National Bank of Canada, Canadian Western Bank, Royal Bank of Canada and ICICI Bank Canada. All dollar amounts are stated in U.S. currency.

Under the terms of the Amended Agreement, the maturity date has been extended to August 11, 2026. In addition, total borrowing capacity increases. The remaining debt drawn on the prior revolving facility to fund a $10 million regulatory approval milestone in 2022 is being combined with the principal amount remaining on the secured term loan for a new senior secured term loan balance of $93.8 million at the time of closing of the Amended Agreement. In addition, there is a new revolving facility of $30.0 million and an expansion facility of up to $70.0 million through which the Company can access incremental loans to support growth opportunities. Finally, interest rates under the Amended Agreement are essentially unchanged at Adjusted SOFR +2.75% to +4.25%, depending on the net leverage of the Company over time.

Under the terms of the Amended Agreement, the Company is required to comply with similar financial covenants related to the maintenance of liquidity and coverage ratios as before and the lenders continue to have security over substantially all the assets of the Company. The Company may also be required to make additional payments from surplus cash-flow, or the Company could choose to repay some or all of the amount outstanding at any time during the term without penalty.

"We'd like to thank JPMorgan and the entire syndicate for their ongoing support and collaboration, and we are pleased to welcome TD Bank and Canadian Western Bank as two new members of the lending group bringing additional diversification and expanded financial capacity," said Tim Hendrickson, CFO at HLS. "The Amended Agreement enhances our already strong financial position with an extended term, increased borrowing capacity, and greater financial flexibility to pursue growth opportunities and other value creation initiatives, such as our share buyback."

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