BioPharma Credit PLC UPDATE ON INVESTMENT (2077U)

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RNS Number : 2077U

BioPharma Credit PLC

22 November 2023

22 November 2023

BIOPHARMA CREDIT PLC

UPDATE ON INVESTMENT

BioPharma Credit PLC (LSE: BPCR) notes the filing of a Form 6-K made on 20 November 2023 by LumiraDx Limited ("LumiraDx") which discloses an amendment to the loan agreement entered into with BioPharma Credit PLC, BPCR Limited Partnership, and BioPharma Credit Investments V (Master) LP, which is copied below in part for

convenience and can be found in its entirety at:   LumiraDx Form 6-K Report : 

" EXPLANATORY NOTE

Amendment to Loan Agreement

On November 20, 2023, LumiraDx Investment Limited (the "Borrower"), one of the subsidiaries of LumiraDx Limited (the "Company" or "LumiraDx"), entered into a sixteenth amendment to that certain Loan Agreement, dated March 23, 2021 (as amended from time to time, the "Loan Agreement"), with BioPharma Credit Investments V (Master) LP and BPCR Limited Partnership, as the lenders (the "Lenders"), and BioPharma Credit PLC, as collateral agent (the "Sixteenth Amendment").

Pursuant to the Sixteenth Amendment, among other things, (i) the minimum liquidity covenant in the Loan Agreement is waived until the end of the Waiver Period (as defined in the Sixteenth Amendment), provided that the consolidated liquidity of the Company and its subsidiaries during this waiver period (and tested on a weekly basis) must be at least $5 million, (ii) the minimum net sales covenant for the trailing twelve-month period ended September 30, 2023 will be tested at the end of the Waiver Period, and (iii) the Waiver Period has been extended to December 10, 2023; provided that the Lenders may terminate the Waiver Period on any date after December 2, 2023 by providing notice to the Borrower one business day in advance of such termination. The Lenders have also agreed, subject to the terms of the Loan Agreement as amended by the Sixteenth Amendment, to extend the availability of undrawn additional term loans that they agreed to provide under the Fifteenth Amendment to the Loan Agreement such that an aggregate amount of up to previously undrawn $4 million (the "Extended Term Loans") shall remain available until December 10, 2023. The Extended Term Loans will be subject to an interest rate of SOFR plus 8.0% per annum, payable in quarterly installments. All amounts outstanding under the Loan Agreement, including the Extended Term Loans, will mature on March 29, 2024.

The foregoing description of the Sixteenth Amendment does not purport to be complete and is qualified in its entirety by reference to the Sixteenth Amendment which is attached to this Form 6-K as Exhibit 4.1, and incorporated herein by reference.

Retention Plan

On November 20, 2023, the Board of Directors of LumiraDx, in coordination with the Lenders, approved a Key Employee Retention Plan (the "Retention Plan") that is designed to retain the executive officers and certain key employees of the LumiraDx group in their current roles over the near term. The goal of the Retention Plan is to maintain business continuity in consideration of the Company's previously announced, ongoing strategic review which may involve administration or bankruptcy proceedings, one or more sales transactions, and/or the restructuring of existing indebtedness. The Lenders have agreed to provide the required funding to enable relevant LumiraDx group companies to perform their obligations under the Retention Plan.

In addition to certain other retention measures, the Retention Plan provides up to an aggregate of $3.8 million in cash bonus payments to eligible participants. While certain cash bonus payments to certain executive officers are based on the achievement of performance goals, a majority of the cash bonus payments provided pursuant to the Retention Plan are contingent upon the participants' continued employment with the LumiraDx group through August 31, 2024 (or July 31, 2024 for non-executive officer employees); provided, that payments would be accelerated prior thereto as a result of certain transactions that may arise as result of the ongoing strategic review of the business of the Company and its subsidiaries. Each participant will forfeit any unpaid amounts of his or her Retention Plan payment if the participant is terminated for gross misconduct or voluntarily resigns his or her employment with the relevant LumiraDx group company prior to the applicable payment date .

This report on Form 6-K, including Exhibit 4.1 hereto, shall be deemed to be incorporated by reference into the Company's registration statements on Form S-8 (File No. 333-259874, File No. 333-264611 and File No. 333-271538), and the registration statements on Form F-3 (File No. 333-264609 and File No. 333-271624), and to be a part thereof from the date on which this report is filed, to the extent not superseded by documents or reports subsequently furnished."

Pharmakon Advisors, LP will continue to provide updates in due course.

Enquiries

Buchanan

David Rydell / Mark Court / Jamie Hooper / Henry Wilson

[phone]

[e-mail]

Notes to Editors

BioPharma Credit PLC is London's only specialist debt investor to the life sciences industry and joined the LSE in March 2017. BioPharma Credit PLC seeks to provide long-term shareholder returns, principally in the form of sustainable income distributions from exposure to the life sciences industry. BioPharma Credit PLC seeks to achieve this objective primarily through investments in debt assets secured by royalties or other cash flows derived from the sales of approved life sciences products.

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November 22, 2023 02:01 ET (07:01 GMT)