Company: BLCO
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001860742-25-000004
Chunk: 215

Company: Bausch & Lomb Corp
Filing Date: 2025-02-19
Form: 10-K
Item: Item 1A
Chunk 215
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 Facility Financial Covenant in effect prior to the IG Trigger may be waived or amended with the consent of a majority of the lenders under the Revolving Facility, and without the consent of the lenders under the Term Facilities or any other person, and contains a customary term loan facility standstill and customary cure rights. The May 2027 Incremental Term Facility contains a financial covenant (the “May 2027 Incremental Term Facility Financial Covenant”) that requires Bausch + Lomb to, as of the last day of each fiscal quarter of Bausch + Lomb (commencing with the fiscal quarter ending March 31, 2025), maintain a maximum first lien net leverage ratio of not greater than (1) for the first four full fiscal quarters ending after the effective date of the May 2027 Incremental Term Facility, 5.00:1.00 and (2) thereafter, 4.50:1.00. The May 2027 Incremental Term Facility Financial Covenant may be waived or amended with the consent of a majority of the lenders under the Revolving Facility, and without the consent of the lenders under any other Senior Secured Credit Facility (as defined herein) or any other person, and contains a customary standstill and customary cure rights. The indenture governing the October 2028 Secured Notes also contains negative covenants and events of default that are similar to those contained in the Senior Secured Credit Facilities.Such financial or other covenants limit our operational flexibility in a number of other ways, including:•causing us to be less able to take advantage of business opportunities, such as making certain investments and other restricted payments and engaging in mergers, acquisitions consolidations and amalgamations, and to react to changes in market or industry conditions;•increasing our vulnerability to adverse economic, industry, or competitive developments;•affecting our ability to pay or refinance debts as they become due during adverse economic, financial market, and industry conditions;•requiring us to use a portion of cash flow for debt service, reducing funds available for other purposes;•decreasing our profitability and/or cash flow;•causing us to be disadvantaged compared to competitors with less leverage; and•limiting our ability to borrow additional funds in the future to fund working capital, capital expenditures, and other general corporate purposes.Further, our credit facilities have Secured Overnight Financing Rate (“SOFR”)-based interest rates. SOFR is a relatively new reference rate, has a very limited history and is based