Company: PIII
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001628280-25-015305
Chunk: 70

Company: P3 Health Partners Inc.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 7
Chunk 70
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 full upon (i) a change of control of the Company and (ii) certain qualified financings (as defined in the VGS 1 2024 Loan).The VGS 1 2024 Loan restricts the Company’s ability to, among other things, incur indebtedness and liens, and make investments and restricted payments. The maturity date may be accelerated as a remedy under the certain default provisions in the agreement, or in the event a mandatory prepayment event occurs.In connection with the issuance of the VGS 1 2024 Loan, the Company also entered into a subordination agreement, dated as of December 12, 2024 (the “VGS 1 2024 Subordination Agreement”) with VGS which subordinates VGS’s right of payment under the VGS 1 2024 Loan to the right of payment and security interests of the lenders under the Term Loan Facility. Under the terms of the VGS 1 2024 Subordination Agreement, the Company is effectively required to pay all interest under the VGS 1 2024 Loan in-kind.VGS 2 Promissory NoteOn March 22, 2024, P3 LLC entered into a related party financing transaction (see Note 19 “Related Parties”) with VBC Growth SPV 2, LLC (“VGS 2”), consisting of the issuance of an unsecured promissory note (the “VGS 2 Promissory Note”) to VGS 2 and a subordination agreement (“VGS 2 Subordination Agreement”), pursuant to which VGS 2 agreed to subordinate its right of payment under the VGS 2 Promissory Note to the right of payment and security interests of the lenders under the Term Loan Facility. The VGS 2 Promissory Note provided for funding of up to $25.0 million. The Company paid VGS 2 an up-front fee of 1.5% of the aggregate principal amount of the loan in-kind. As of December 31, 2024, $25.4 million had been drawn on the VGS 2 Promissory Note and the Company had recorded debt issuance costs and original issue discount of $0.5 million.The VGS 2 Promissory Note matures on September 30, 2027. Interest is payable at 17.5% per annum on a quarterly cycle (in arrears) beginning June 30, 2024. The Company may elect to pay interest