Yea - I thought is was pretty interesting deal - term loan with TTM contribution margin borrowing base / deleveraging mechanism. I plan to provide a few more comments when I post on LI later this week.
Definitely a unique structure for a term loan but given financial performance/ issues discussed on Q3 earnings, I think it is prudent to layer in a deleveraging mechanism here. Also worth noting that the additional $20m is contingent on lender’s approval so co. will need to perform to get access to that 2nd tranche. Agreed 7.5% final payment is 200 - 300 bps higher than what I typically see but suspect Hercules had some pricing power here given the profile. Will be a deal to watch in the coming quarters..
Great find! I didn’t even see this one!
Yea - I thought is was pretty interesting deal - term loan with TTM contribution margin borrowing base / deleveraging mechanism. I plan to provide a few more comments when I post on LI later this week.
Definitely a unique structure for a term loan but given financial performance/ issues discussed on Q3 earnings, I think it is prudent to layer in a deleveraging mechanism here. Also worth noting that the additional $20m is contingent on lender’s approval so co. will need to perform to get access to that 2nd tranche. Agreed 7.5% final payment is 200 - 300 bps higher than what I typically see but suspect Hercules had some pricing power here given the profile. Will be a deal to watch in the coming quarters..