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MarketScreener Homepage  >  Equities  >  Nasdaq  >  Coherus Biosciences Inc    CHRS

COHERUS BIOSCIENCES INC

(CHRS)
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COHERUS BIOSCIENCES, INC. : Entry into a Material Definitive Agreement, Financial Statements and Exhibits (form 8-K)

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01/11/2019 | 05:11pm EDT

Item 1.01 Entry into a Material Definitive Agreement.

On January 7, 2019 (the "Closing Date"), Coherus BioSciences, Inc. (the "Company") entered into a credit agreement (the "Agreement") with affiliates of Healthcare Royalty Partners (together, the "Lenders"). The Agreement consists of a six-year term loan facility for an aggregate principal amount of $75,000,000 (the "Borrowings"). The obligations of the Company under the loan documents are guaranteed by the Company's material domestic U.S. subsidiaries (the "Guarantors").

The Borrowings under the Agreement bear interest through maturity at 7.00% per annum plus LIBOR (customarily defined). If the consolidated net sales (customarily defined) for UDENYCA™, the Company's pegfilgrastim (Neulasta®) biosimilar, for the fiscal year ending December 31, 2019, are in excess of $250,000,000, then the interest rate will be reduced as of January 1, 2020 to 6.75% per annum plus LIBOR. Interest is payable quarterly in arrears.

Principal payments on the Borrowings are required to be paid in equal quarterly installments beginning on the four year anniversary of the Closing Date (or, if consolidated net sales of UDENYCA™ in the fiscal year ending December 31, 2021 are less than $375,000,000, beginning on the three year anniversary of the Closing Date), with the outstanding balance to be repaid on January 7, 2025 (the "Maturity Date").

The Company is also required to make mandatory prepayments of the Borrowings under the Agreement, subject to specified exceptions, with the proceeds of asset sales, extraordinary receipts, debt issuances and specified other events including the occurrence of a change in control.

If all or any of the Borrowings are prepaid or required to be prepaid under the Agreement, then the Company shall pay, in addition to such prepayment, a prepayment premium (the "Prepayment Premium") equal to (i) with respect to any prepayment paid or required to be paid on or prior to the three year anniversary of the Closing Date, 5.00% of the Borrowings prepaid or required to be prepaid, plus all required interest payments that would have been due on the Borrowings prepaid or required to be prepaid through and including the three year anniversary of the Closing Date, (ii) with respect to any prepayment paid or required to be paid after the three year anniversary of the Closing Date but on or prior to the four year anniversary of the Closing Date, 5.00% of the Borrowings prepaid or required to be prepaid, (iii) with respect to any prepayment paid or required to be paid after the four year anniversary of the Closing Date but on or prior to the five year anniversary of the Closing Date, 2.50% of the Borrowings prepaid or required to be prepaid, and (iv) with respect to any prepayment paid or required to be prepaid thereafter, 1.25% of the Borrowings prepaid or required to be prepaid.

In connection with the Agreement, the Company paid a closing fee to the Lenders of $1,125,000. Upon the prepayment or repayment of the Borrowings (or upon the date such prepayment or repayment is required to be paid), the Company is required to pay an additional exit fee in an amount equal to 4.00% of the total principal amount of the Borrowings.

The obligations under the Agreement are secured by a lien on substantially all of the Company's and the Guarantors' tangible and intangible property, including intellectual property. The Agreement contains certain affirmative covenants, negative covenants and events of default, including, covenants and restrictions that among other things, restrict the ability of the Company and its subsidiaries to, incur liens, incur additional indebtedness, make loans and investments, engage in mergers and acquisitions, in asset sales, and declare dividends or redeem or repurchase capital stock. Additionally, the consolidated net sales for UDENYCA™ must not be lower than $70,000,000 for the fiscal year ending December 31, 2019, (b) $125,000,000 for the fiscal year ending December 31, 2020, and (c) $150,000,000 for each fiscal year thereafter. A failure to comply with these covenants could permit the Lenders under the Agreement to declare the Borrowings, together with accrued interest and fees, to be immediately due and payable.

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The foregoing description of the material terms of the Agreement does not purport to be complete and is subject to, and is qualified in its entirety by reference to the Agreement, which is filed as an exhibit to this Current Report on Form 8-K.

Item 9.01 Financial Statements and Exhibits.

The following exhibit is filed as part of this Current Report on Form 8-K.



Exhibit
  No.        Description

10.1*          Credit Agreement, dated as of January 7, 2019, by and among the
             Company and the Lenders



* Schedules and exhibits to the Credit Agreement, dated as of January 7, 2019, by

and among the Company and the Lenders have been omitted pursuant to

Item 601(b)(2) of Regulation S-K. The Company will furnish copies of any such

schedules and exhibits to the SEC upon request.

--------------------------------------------------------------------------------

© Edgar Online, source Glimpses

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