ALEXION PHARMACEUTICALS, INC. (NASDAQ:ALXN) Files An 8-K Entry into a Material Definitive AgreementItem 2.03Entry into a Material Definitive Agreement.
The information in Item 2.03 below is incorporated herein by reference in its entirety.
Item 2.03Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
On June 7, 2018, Alexion Pharmaceuticals, Inc. (“Alexion”) entered into an Amended and Restated Credit Agreement (the “Credit Agreement”), by and among Alexion, as Administrative Borrower, certain foreign subsidiaries party thereto as borrowers, the lenders and other financial institutions party thereto and Bank of America, N.A., as Administrative Agent. The Credit Agreement amends and restates Alexion’s existing credit agreement dated as of June 22, 2015 (the “Existing Credit Agreement”).
The Credit Agreement provides for a $1.0 billion revolving credit facility, comprised of a $300 million domestic tranche and a $700 million global tranche, and a $2.6125 billion term loan facility. Alexion is the sole borrower of the domestic tranche of the revolving credit facility and the term facility. The global tranche of the revolving credit facility is available for borrowings by Alexion and the subsidiary borrowers. As of June 7, 2018, $250 million of borrowings and $1.84 million of letters of credit were outstanding under the revolving credit facility and the full amount of the term loan facility was outstanding.
The revolving credit facility and the term loan facility mature on June 7, 2023. Commencing on June 30, 2019, Alexion is required to make amortization payments of 5.00% of the aggregate principal amount of the term loan facility annually, payable in equal quarterly installments. The proceeds of the borrowing under the Credit Agreement were used to refinance amounts outstanding under the Existing Credit Agreement.
Loans under the Credit Agreement bear interest, at Alexion’s option, at either a base rate or a Eurodollar rate, in each case plus an applicable margin. Under the Credit Agreement, the applicable margins on base rate loans range from 0.25% to 1.00% and the applicable margins on Eurodollar loans range from 1.25% to 2.00%, in each case based on Alexion’s consolidated net leverage ratio. As of the closing date of the Credit Agreement, the applicable margin on base rate loans was 0.50% and on Eurodollar loans was 1.50%.
The loans under the Credit Agreement are guaranteed by certain of Alexion’s foreign and domestic subsidiaries and secured by liens on certain of Alexion subsidiaries’ equity interests, subject to certain exceptions.
Under the terms of the Credit Agreement, Alexion must maintain a ratio of total net debt to EBITDA, as defined in the Credit Agreement, (the “consolidated net leverage ratio”) of 3.50 to 1.00, subject to certain increases following designated material acquisitions. In addition, Alexion must maintain a ratio of EBITDA to cash interest expense of at least 3.50 to 1.00.
The Credit Agreement contains certain representations and warranties, affirmative and negative covenants and events of default. The negative covenants in the credit agreement restrict Alexion’s and its subsidiaries’ ability, subject to certain significant baskets and exceptions, to incur liens or indebtedness, make investments, enter into mergers and other fundamental changes, make dispositions or pay dividends. The restriction on Alexion paying dividends includes an exception that permits Alexion to pay dividends and make other restricted payments regardless of dollar amount so long as, after giving pro forma effect thereto, Alexion would have a consolidated net leverage ratio, as defined in the Credit Agreement, no greater than 3.25 to 1.00, subject to certain increases following designated material acquisitions. As of the most recently ended fiscal quarter, Alexion’s consolidated net leverage ratio, as defined in the Credit Agreement, was below 3.25 to 1.00. So long as Alexion’s consolidated total net leverage ratio remains below 3.25 to 1.00, the credit agreement does not restrict the ability of the Company to pay dividends.
The above summary of certain terms and conditions of the Credit Agreement does not purport to be a complete discussion of that agreement and is qualified in its entirety by reference to the Credit Agreement, a copy of which is attached to this report as Exhibit 10.1.
The Credit Agreement attached to this Current Report on Form 8-K and the above description have been included to provide investors and security holders with information regarding the terms of such document. They are not intended to provide any other factual information about Alexion or its respective subsidiaries, affiliates, businesses or equity holders. The representations, warranties, covenants and events of default contained in the Credit Agreement were made only for purposes of the Credit Agreement and as of specific dates; were solely for the benefit of the parties to the Credit Agreement; and may be subject to limitations agreed upon by the parties, including being qualified by confidential disclosures made by each contracting party to the other for the purposes of allocating contractual risk between them that differ from those applicable to investors. Investors should be aware that the representations warranties and covenants or any description thereof may not reflect the actual state of facts or condition of Alexion or any of its respective subsidiaries, affiliates, businesses or equity holders. Moreover, information concerning the subject matter of the representations, warranties, covenants and events of default may change after the date of such documents, as applicable, which subsequent information may or may not be fully reflected in public disclosures by Alexion. Accordingly, investors should read the representations and warranties in the Credit Agreement not in isolation but only in conjunction with the other information about Alexion that it includes in reports, statements and other filings it makes with the SEC.
Item 2.03Financial Statements and Exhibits.
(d)Exhibits
ALEXION PHARMACEUTICALS INC ExhibitEX-10.1 2 a101alxn_xamendedandrestat.htm EXHIBIT 10.1 Exhibit Exhibit 10.1[EXECUTION COPY]Published Deal CUSIP: 01535EAP6Published Domestic Revolver CUSIP: 01535EAQ4Published Global Revolver CUSIP: 01535EAR2Published Term Loan CUSIP: 01535EAS0AMENDED AND RESTATED CREDIT AGREEMENTDated as of June 7,…To view the full exhibit click here
About ALEXION PHARMACEUTICALS, INC. (NASDAQ:ALXN)
Alexion Pharmaceuticals, Inc. is a biopharmaceutical company. The Company is focused on the development and commercialization of life-transforming therapeutic products. The Company operates through innovation, development and commercialization of life-transforming therapeutic products segment. The Company’s marketed products include Soliris (eculizumab), Strensiq (asfotase alfa) and Kanuma (sebelipase alfa). The Company’s clinical programs include Soliris (eculizumab), ALXN 1101, ALXN 1007, SBC-103, ALXN 1210 and ALXN 5500. It offers Soliris for patients with either paroxysmal nocturnal hemoglobinuria (PNH), a life-threatening and ultra-rare genetic blood disorder, or atypical hemolytic uremic syndrome (aHUS), a life-threatening and ultra-rare genetic disease. Strensiq is a targeted enzyme replacement therapy. It offers Kanuma for the treatment of patients with Lysosomal Acid Lipase Deficiency (LAL-D). ALXN 1007 is a humanized antibody designed to target inflammatory disorders.