Company: ARWR
Filing Date: 2025-05-12
Form Type: 10-Q
Source: 0001628280-25-024666
Chunk: 96

Company: ARROWHEAD PHARMACEUTICALS, INC.
Filing Date: 2025-05-12
Form: 10-Q
Item: Part I, Item 8
Chunk 96
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the "Amendment") to modify, amongst other things, some of the prepayment terms of the loans under the Credit Facility, including, the prepayment terms related to the Sarepta Collaboration Agreement. The Amendment was effective on February 14, 2025, following the closing of the Sarepta Collaboration Agreement and receipt of the $500.0 million upfront payment from Sarepta. As a result, the Company paid $150.0 million of the loans under the Credit Facility during the second quarter of fiscal 2025. The Amendment was accounted for as a debt modification under ASC 470-50, “Debt—Modification and extinguishments” since the amendment did not result in substantially different terms. In connection with the Amendment, the Company did not incur significant third-party fees.The Company also paid $1.6 million during the second quarter of fiscal 2025, representing 65% of the milestone payments from GSK under the Credit Facility term. See Note 2. All obligations under the Financing Agreement will be secured on a first-priority basis, subject to certain exceptions, by security interests in substantially all assets of the Company and material subsidiaries of the Company, including its intellectual property, and will be guaranteed by material subsidiaries of the Company, including foreign subsidiaries, subject to certain exceptions.The Financing Agreement contains customary covenants, including, without limitation, a financial covenant to maintain liquidity (cash, cash equivalents and investments) of at least $100.0 million if the Company’s market capitalization is above $1.5 billion, and negative covenants that, subject to certain exceptions, restrict indebtedness, liens, investments (including acquisitions), fundamental changes, asset sales and licensing transactions, dividends, modifications to material agreements, payment of subordinated indebtedness, and other matters customarily restricted in such agreements. The Company is subject to restrictions on sales and licensing transactions with respect to certain core intellectual property, subject to certain exceptions, including certain transactions related to areas outside the United States, United Kingdom, European Union, Japan and China.The Financing Agreement contains certain embedded features that were identified and evaluated as not material to the consolidated financial statements.The outstanding balance of the Credit Facility consisted of the following:March 31, 2025September 30, 2024(in thousands)Initial Term Loan$400,000 $400,000 Accumulated interest on the Initial Term Loan39,687 9,000 Less: Unamortized debt discount and issuance costs(