| Item 1.01. | Entry into a Material Definitive Agreement |
Credit Agreements
On May 10, 2022, Bausch Health Companies Inc. (“Bausch Health” or the “Company”) entered into a Second Amendment (the “Second Amendment”) in respect of a Fourth Amended & Restated Credit and Guaranty Agreement (the “Existing Credit Agreement”) among the Company, Bausch Health Americas, Inc. (“BHA”), a wholly owned subsidiary of the Company, certain other subsidiaries of the Company as subsidiary guarantors, the financial institutions party thereto as lenders and issuing banks and Barclays Bank PLC as administrative agent, collateral agent and swingline lender. The Second Amendment provides for the refinancing of its existing term loan and revolving credit facilities with a new term facility with an aggregate principal amount of $2,500 million (the “2027 Term Loan B Facility”) maturing on February 1, 2027 and a new revolving credit facility of $975 million (the “2027 Revolving Credit Facility”) that will mature on the earlier of February 1, 2027 and the date that is 91 calendar days prior to the scheduled maturity of indebtedness for borrowed money of the Company and BHA in an aggregate principal amount in excess of $1,000 million. The amortization rate for the 2027 Term Loan B Facility is 5.00% per annum and the first installment shall be payable on September 30, 2022. The Company may direct that prepayments be applied to such amortization payments in order of maturity.
In addition, on May 10, 2022, Bausch + Lomb Corporation (“Bausch + Lomb”) entered into a Credit and Guaranty Agreement (the “Bausch + Lomb Credit Agreement”) among Bausch + Lomb, certain subsidiaries of Bausch + Lomb as subsidiary guarantors, the financial institutions party thereto as lenders and issuing banks, Citibank, N.A. as revolving facility administrative agent, collateral agent and swingline lender, and Goldman Sachs Bank USA as term facility administrative agent.
The Bausch + Lomb Credit Agreement provides for a five-year term loan facility in an initial principal amount of $2,500 million. The Bausch + Lomb Credit Agreement also provides for a five-year revolving credit facility in the amount of $500 million. Borrowings under the term loan facility bear interest at a rate per annum equal to, at the Bausch + Lomb’s option, either (a) a term SOFR-based rate, plus an applicable margin of 3.25% or (b) a U.S. dollar base rate, plus an applicable margin of 2.25%. The amortization rate for the term loan facility is 1% per annum and the first installment shall be payable on September 30, 2022. Bausch + Lomb may direct that prepayments be applied to such amortization payments in order of maturity. A description of certain other terms of the Credit Agreement is set forth in the section titled “Description of Material Indebtedness” in the final prospectus, dated May 5, 2022 (the “Prospectus”) relating to Bausch + Lomb’s Registration Statement on Form S-1 (File No. 333-262148), as amended.
The foregoing descriptions do not purport to be complete and are qualified in their entirety by reference to the Second Amendment and the Bausch + Lomb Credit Agreement filed as Exhibits 10.1 and 10.2 hereto, respectively, each of which is incorporated herein by reference.
Completion of Bausch + Lomb IPO
On May 10, 2022, Bausch + Lomb closed its initial public offering of 35,000,000 common shares, at a public offering price of $18.00 per share (the “IPO”). A wholly owned subsidiary (the “Selling Shareholder”) of Bausch Health offered all of the common shares, and received aggregate gross proceeds of $630 million, the net proceeds of which, together with the net proceeds from Bausch Health’s term loans under the 2027 Term Loan B Facility, funds received from Bausch + Lomb from its borrowings under its new term loan facility and cash on hand, were used to repay the Company’s existing term loans and to repay certain of the Company’s existing senior notes, as described below. The Selling Shareholder has granted the underwriters a 30-day option to purchase up to an additional 5,250,000 common shares of Bausch + Lomb to cover over-allotments, if any, at the initial public offering price, less discounts and commissions.
