February 26, 2019 – The Court hearing the Synergy Pharmaceuticals case issued a final order [Docket No. 454] authorizing the Debtors to access debtor-in-possession (“DIP”) financing of $159.1mn (the “DIP Loans”) which is comprised of (i) approximately $114.1mn of loans representing a partial “roll-up” of prepetition secured obligations and (ii) $45.0mn of “new money” loans (the “New Money DIP Loans”). The New Money DIP Loans have been made in three tranches of $8.0mn, $12.0mn and $25.0mn, respectively, the last of which was made pursuant to this final order. The final order also permitted for access to a further third tranche of funds available to roll up prepetition obligations, this third tranche being $57.9mn.
Key Terms of the DIP Financing (defined terms used below are as defined in the DIP Credit Agreement):
- Borrowers: Synergy Pharmaceuticals Inc.
- Guarantors: Synergy Advanced Pharmaceuticals Inc., a wholly owned subsidiary of the Borrower.
- DIP Lenders: CRG Partners III L.P., CRG Partners III (Cayman) Unlev AIV I L.P., CRG Partners III – Parallel Fund “A” L.P., CRG Partners III – Parallel Fund “B” L.P., CRG Partners III (Cayman) Lev AIV I L.P., CRG Issuer 2017-1, as may be amended prior to the entry of the Final Order solely to adjust the proportionate shares of the DIP Lenders, but not to reduce the aggregate commitments of the DIP Lenders, collectively
- DIP Agent: CRG Servicing LLC.
- DIP Loans and New Money DIP Loans: Commitments total $159.1mn (up from $155.0mn) in the aggregate, consisting of (a) $45.0mn of “new money” loans, and (b) approximately $114.1mn (up from $110.0mn) of loans representing a “roll up” of a portion of the Prepetition Obligations.
- Interest Rates: Interest shall accrue on the DIP Loans at the rate of Libor + 9.50% per annum
- Use of DIP Proceeds and Cash Collateral: The proceeds of the New Money DIP Loans and Cash Collateral shall be available to finance, in each case in accordance with the Budget (as defined below): (i) working capital and general corporate purposes of the Debtors; (ii) the pursuit of an Acceptable 363 Sale; and (iii) bankruptcy-related costs and expenses, subject to the Carve Out.
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