Paragon 28, Inc.: debt financing — Paragon 28 secures $150M credit facility from Ares, replacing $90M MidCap facility

Paragon 28, Inc.

New $150M facility includes $100M term loan ($75M drawn at close) and $50M revolver ($25M drawn).
Interest: term loan at SOFR + 6.75-6.25% or base + 5.75-5.25%; revolver at SOFR + 4% or base + 3%.
Pro forma liquidity of $147M as of Sep 30, 2023: $97M cash + $50M available revolver.
Facility is non-dilutive with no warrants; proceeds used to repay and terminate existing $90M MidCap credit agreement.
Matures in 5 years; financial covenant requires minimum revenue levels.

item 1.01 item 1.02 item 2.03 item 7.01 item 9.01

Key facts

Extracted from this filing and checked against the source text.

Debt Financings SEC 8-K Item 2.03/2.04 confidence 0.9

Paragon 28, Inc. incurred revolving credit of up to $50.0 million with Ares Capital Corporation at Term SOFR plus an applicable margin of 4.00% maturing the earlier of (i) 5 years from the Closing Date and (ii) with respect to the Ares Revolving Facility, 6 months prior to the maturity date of any other indebted.

Instrument: revolving credit
Principal: up to $50.0 million
Counterparty: Ares Capital Corporation
Rate: Term SOFR plus an applicable margin of 4.00%
Maturity: the earlier of (i) 5 years from the Closing Date and (ii) with respect to the Ares Revolving Facility, 6 months prior to the maturity date of any other indebted
Event: incurrence

Exact text from the filing

and a revolving credit facility in an aggregate principal amount of up to $50.0 million ("Ares Revolving Facility")

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Debt Financings SEC 8-K Item 2.03/2.04 confidence 0.9

Paragon 28, Inc. incurred term loan of up to $100.0 million with Ares Capital Corporation at adjusted Term Secured Overnight Financing Rate ("Term SOFR") plus an applicable maturing the earlier of (i) 5 years from the Closing Date and (ii) with respect to the Ares Revolving Facility, 6 months prior to the maturity date of any other indebted.

Instrument: term loan
Principal: up to $100.0 million
Counterparty: Ares Capital Corporation
Rate: adjusted Term Secured Overnight Financing Rate ("Term SOFR") plus an applicable
Maturity: the earlier of (i) 5 years from the Closing Date and (ii) with respect to the Ares Revolving Facility, 6 months prior to the maturity date of any other indebted
Event: incurrence

Exact text from the filing

including a term loan facility in an aggregate principal amount of up to $100.0 million (the "Ares Term Loan Facility")

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Debt Financings SEC 8-K Item 2.03/2.04 confidence 0.9

Paragon 28, Inc. incurred credit facility of $150.0 million with Ares Capital Corporation at adjusted Term Secured Overnight Financing Rate ("Term SOFR") plus an applicable maturing the earlier of (i) 5 years from the Closing Date and (ii) with respect to the Ares Revolving Facility, 6 months prior to the maturity date of any other indebted.

Instrument: credit facility
Principal: $150.0 million
Counterparty: Ares Capital Corporation
Rate: adjusted Term Secured Overnight Financing Rate ("Term SOFR") plus an applicable
Maturity: the earlier of (i) 5 years from the Closing Date and (ii) with respect to the Ares Revolving Facility, 6 months prior to the maturity date of any other indebted
Event: incurrence

Exact text from the filing

On November 2, 2023 (the "Closing Date"), the Company and its wholly-owned subsidiary, Paragon Advanced Technologies, Inc. ("Paragon Advanced Technologies" and, together with the Company, the "Borrowers"), entered into a new credit agreement (the "Ares Credit Agreement") with Ares Capital Corporation ("Ares"), as administrative agent and collateral agent, ACF FINCO I LP ("ACF" and, together with Ares, "Ares Capital") as revolving agent, and the lenders party thereto, to provide senior secured credit facilities to the Borrowers in an aggregate principal amount of $150.0 million (the "Ares Credit Facilities")

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Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.9

Paragon 28, Inc. terminated MidCap Credit Agreements with MidCap Financial Trust (effective 2023-11-02).

Action: termination
Agreement: credit facility
Counterparty: MidCap Financial Trust
Effective: 2023-11-02

Exact text from the filing

On November 2, 2023, the Company paid all outstanding amounts owed under the MidCap Credit Agreements with a portion the proceeds of the Ares Credit Facilities, and concurrently terminated the Midcap Credit Facilities under the MidCap Credit Agreements.

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Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.9

Paragon 28, Inc. entered into Ares Credit Agreement with Ares Capital Corporation valued at $150.0 million (effective 2023-11-02).

Action: entry
Agreement: credit facility
Counterparty: Ares Capital Corporation
Value: $150.0 million
Effective: 2023-11-02

Exact text from the filing

On November 2, 2023 (the “Closing Date”), the Company and its wholly-owned subsidiary, Paragon Advanced Technologies, Inc. (“Paragon Advanced Technologies” and, together with the Company, the “Borrowers”), entered into a new credit agreement (the “Ares Credit Agreement”) with Ares Capital Corporation (“Ares”), as administrative agent and collateral agent, ACF FINCO I LP (“ACF” and, together with Ares, “Ares Capital”) as revolving agent, and the lenders party thereto, to provide senior secured credit facilities to the Borrowers in an aggregate principal amount of $150.0 million

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Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.9

Paragon 28, Inc. amended Zion Facility with Zions Bancorporation, N.A., dba Vectra Bank Colorado (effective 2023-11-02).

Action: amendment
Agreement: credit facility
Counterparty: Zions Bancorporation, N.A., dba Vectra Bank Colorado
Effective: 2023-11-02

Exact text from the filing

Effective as of November 2, 2023, we amended our facility with Zions Bancorporation, N.A., dba Vectra Bank Colorado (the “Zion Facility”) to replace references to MidCap Financial Trust and MidCap Credit Agreements with references to Ares and the Ares Credit Agreement.

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Source: SEC EDGAR

accession 0000950170-23-060213

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