Credit Agreement and Financing - Outbrain Inc. has secured a credit agreement dated February 3, 2025, with Goldman Sachs Bank USA as the sole Administrative Agent[1]. - The agreement includes commitments for loans and borrowings, with specific sections detailing repayment procedures and interest elections[2]. - The credit facility is structured to support Outbrain's operational and strategic initiatives, including potential market expansions and product developments[3]. - The agreement outlines provisions for letters of credit and swingline loans, enhancing liquidity management capabilities[4]. - The credit agreement includes terms for increased costs and break funding payments, which may impact future financial performance[6]. - The agreement specifies conditions for additional borrowers, allowing for flexibility in capital structure[8]. - The credit facility is anticipated to support Outbrain's long-term growth strategy and operational efficiency[10]. - The credit agreement outlines specific terms for borrowing, including interest rates tied to the ABR, which reflects current market conditions[17]. - The Applicable Commitment Fee for the Revolving Facility Loans is 0.375% when the Secured Leverage Ratio is ≤ 1.70 to 1.00, and increases to 0.500% when the ratio exceeds 1.70 to 1.00[36]. - The Applicable Margin for Bridge Loans is set at 4.75% per annum for SOFR Loans and 3.75% per annum for ABR Loans, with a cumulative increase of 0.50% per annum on each three-month anniversary of the Closing Date[38]. - The Initial Borrower must pay any accrued additional interest and fees within ten Business Days if the corrected Applicable Commitment Fee is higher than what was previously paid[37]. - The minimum borrowing amount for ABR Revolving Facility Loans and SOFR Loans is 1,000,000,whileforSwinglineLoansitis500,000[74]. - The Borrowing Minimum for ABR Revolving Facility Loans is set at 1,000,000[74].−TheBorrowingMultipleforABRRevolvingFacilityLoansis250,000, and for SOFR and Swingline Loans, it is 100,000[76].StrategicAcquisitions−TheInitialBorrower,OutbrainInc.,isacquiringallissuedandoutstandingsharesoftheTarget,TEADS,aspartofastrategicacquisitionagreement[15].−Theacquisitionissupportedbyacreditextensionfromlenders,indicatingconfidenceinthegrowthpotentialofthecombinedentities[15].−TheInitialBorrowerhasrequestedcreditfromlenderstofacilitatetheacquisition,highlightingthefinancialbackingforthisstrategicmove[15].−Theacquisitionisexpectedtoenhancemarketpresenceandexpandproductofferings,aligningwiththecompany′sgrowthstrategy[15].−TheInitialBorrowerisfocusedonleveragingtheacquisitiontodrivefuturerevenuegrowthandmarketexpansion[15].ComplianceandFinancialManagement−Outbrain′sfinancialstatementswillbesubjecttocompliancewiththetermsoutlinedinthecreditagreement,ensuringtransparencyandaccountability[9].−Theagreementincludesprovisionsformaintainingcompliancewithfinancialcovenants,ensuringfiscalresponsibilitypost−acquisition[14].−TheInitialBorroweriscommittedtoadheringtoaffirmativecovenants,includingmaintainingaccuratefinancialrecordsandcompliancewithlaws[14].−Theagreementincludesprovisionsforquarterlylendercalls,ensuringongoingcommunicationandtransparencywithstakeholders[14].−ThecompanyisrequiredtodelivercorrectedfinancialstatementsifinaccuraciesinpreviouslydeliveredstatementswouldhaveledtoadifferentApplicableCommitmentFee[37].−ThecompanyiscommittedtocompliancewithallrequirementsoftheSecurityDocuments,ensuringtheintegrityofitsfinancialagreements[116].FinancialPerformanceandReporting−Thecompanyreportedaconsolidatedtotaldebtamountingtoasignificantprincipal,excludingcertainliabilitiessuchaslettersofcreditandnon−recourseindebtedness[136].−Consolidatedtotalassetsweredeterminedonaproformabasis,reflectingthetotalassetsofthecompanyanditssubsidiaries[135].−TheconsolidatednetseniorsecuredleverageratiowascalculatedbasedontotaldebtsecuredbycollateralrelativetoEBITDAforthemostrecenttestperiod[134].−Thecompanyreportedaconsolidatednetincomefortheperiod,contributingtotheoverallEBITDAcalculation[162].−TotalinterestexpenseandrelatedcostswereincludedintheEBITDAcalculation,reflectingthecompany′sfinancingactivities[163].−Thecompanyincurreddepreciationandamortizationexpenses,impactingtheoverallfinancialperformance[164].−Thecompanyprojectedexpectedcostsavingsfromvariousinitiatives,whichareanticipatedtoenhanceEBITDAbyupto155,000,000 or 2.0% of EBITDA for the most recently ended Test Period[44]. - "Capital Markets Indebtedness" refers to debt securities issued in public offerings or private placements, excluding commercial bank facilities and similar debts[93]. - "Cash Equivalents" include various forms of liquid assets such as government-backed securities and money market funds, with specific maturity and rating requirements[98]. - The term "Change in Law" encompasses any new laws or regulations adopted after the closing date that may affect the financial obligations of the company[101]. - "Change of Control" is defined by specific conditions under which the ownership structure of the company may change significantly[104]. - The "Collateral Agent" is identified as U.S. Bank Trust Company, National Association, responsible for managing collateral for secured parties[112]. - The "Collateral and Guarantee Requirement" mandates that certain agreements must be executed by the Initial Borrower and Guarantors on the closing date[113]. - "Cash Management Agreement" refers to agreements providing cash management services, including treasury management and electronic funds transfer services[100]. - "Captive Insurance Subsidiary" is defined as any subsidiary regulated as an insurance company[95]. - "Capitalized Lease Obligation" refers to liabilities from capital leases that must be reflected on the balance sheet according to GAAP[94].
Outbrain (OB)2025-02-27 11:56