Section 1.01 Entering into a Material Definitive Agreement.
At January 31, 2022 (the “Effective Date”), Chimerix, Inc. (the “Company”) has entered into a loan and guarantee agreement (the “Loan Agreement”), by and between the Company, as borrower, and Bank of Silicon Valley, as lender (the “Lender”). The Loan Agreement provides for a four-year secured revolving loan facility (the “Credit Facility”) in an aggregate principal amount of up to $50.0 million. Proceeds from the credit facility may be used for working capital and general corporate purposes.
The Company has entered into the loan agreement to increase its financial flexibility, including providing a non-dilutive source of capital that it can draw on to meet its future working capital needs in light of the previously disclosed potential entry into a single source contract with the
Advanced Biomedical Research and Development Authority (“BARD”). The Company has no obligation to draw any amount under the Credit Facility and has not drawn any amount as of the Effective Date. The Company views the Credit Facility as a resource that will supplement its financial position by providing an alternative source of capital that can be drawn upon as needed, for example, prior to a scheduled (or future) shipment of TEMBEXA processing courses. in BARDA in the we National Strategic Reserve over the term of the credit facility.
The Company may borrow, repay and re-borrow funds under the Credit Facility without prepayment penalty up to January 31, 2026 (the “Maturity Date”), the date on which the Credit Facility expires, and all outstanding revolving loans under the Credit Facility, together with all accrued and unpaid interest, must be repaid. No exit charges exist upon expiry of the credit facility on the maturity date. Subject to the satisfaction of certain liquidity ratios, all
$50.0 million of the credit facility will be available for the Company to borrow on a non-formula basis. If the Company is unable to meet these liquidity ratios, availability under the Credit Facility is determined based on a borrowing base equal to percentages of certain accounts receivable and purchase orders. (which include potential options for BARDA to procure TEMBEXA processing courses) for the Company’s property in accordance with a formula set forth in the Loan Agreement.
Borrowings under the Credit Facility bear interest at a variable annual rate of the greater of (i) 1.50% above Prime Rate (as defined below) and (ii) 4.75%. The prime rate is defined as the annual interest rate published in
The Wall Street Journal or any successor publication as “Preferred Rate”. If this interest rate of The Wall Street Journal becomes unavailable, “Prime Rate” means the annual interest rate announced by the Lender as its then prevailing Prime Rate. In each case, if this prime rate is less than zero, this rate will be deemed equal to zero for the purposes of the Loan Agreement. The Company must also pay an unused line fee equal to 0.25% per annum on the unused portion of the credit facility, payable quarterly in arrears. Upon termination of the Loan Agreement for any reason prior to the Maturity Date, the Company shall be liable to pay the Lender an early termination fee of $0.5 million. The loan agreement also requires the company to pay the lender a non-refundable commitment fee of $0.5 millionpayable in four equal installments commencing on the Effective Date and on each anniversary of the Effective Date thereafter until January 31, 2025.
The Company’s obligations under the Loan Agreement are secured by a first lien on substantially all of the Company’s assets other than the Company’s intellectual property, with a negative lien on the Company’s intellectual property. Society.
The Loan Agreement contains customary affirmative and negative covenants and customary events of default that allow the Lender to accelerate the Company’s outstanding obligations under the Loan Agreement, all as set forth in the loan agreement. The loan agreement also contains financial covenants obliging the company to maintain specified levels of liquidities and cash at certain times as stated in the loan agreement.
The foregoing description of the Loan Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Loan Agreement, a copy of which will be filed as an attachment to our Annual Report on Form 10. -K for year ended December 31, 2021 and our quarterly report on Form 10-Q for the quarter ending March 31, 2022.
Forward-looking statements
The Company cautions you that statements included in this report that are not a description of historical facts are forward-looking statements. These forward-looking statements include statements regarding the potential benefits of the Credit Facility to the Company’s operations and financial condition, the timing of entering into any such agreement with BARDA and the final terms of such agreement, and plans for the Company regarding future borrowings under the Credit Facility. The inclusion of forward-looking statements should not be taken as a representation by the Company that any of these results will be achieved. Actual results may differ from those presented in this report due to the risks and uncertainties associated with market conditions, as well as the risks and uncertainties inherent in the business of the Company, including those described in other documents filed by the Company. nearby Securities Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and the Company undertakes no obligation to revise or update this report to reflect events or circumstances. after the date hereof. All forward-looking statements are qualified in their entirety by this
--------------------------------------------------------------------------------
caution. This warning is made pursuant to the safe harbor provisions of Section 21E of the Private Securities Litigation Reform Act of 1995.
Item 2.03 Creation of a Direct Financial Obligation or Obligation Under an Off-Balance Sheet Arrangement of a Registrant.
The information provided in Section 1.01 of this Current Report on Form 8-K is incorporated by reference into this Section 2.03.
————————————————– ——————————
© Edgar Online, source Previews
