Couchbase secures a $25 million loan with MUFG Bank
Couchbase recently announced its entry into a material definitive agreement. Specifically, Couchbase, Inc. has secured a senior secured revolving loan facility worth $25 million from MUFG Bank, with the potential to increase this amount to $50 million.
According to the company, this new credit arrangement replaces the previous one with Silicon Valley Bank. It will provide financial support for the company’s business expenses. The loan is secured by the company’s assets, excluding intellectual property.
It carries an interest rate based on Term SOFR plus 3.0%. Adhering to the terms of the agreement will grant Couchbase the flexibility to borrow and repay within three years.
The company must cover various fees and expenses, including a 0.25% annual fee for the unused portion of the revolving loan facility. Until the third anniversary of the closing date, the company has the flexibility to borrow and repay funds. However, upon the conclusion of the revolving loan facility, all outstanding loans and accrued interest must be fully repaid.
The loan agreement contains both affirmative and negative covenants, which impose limitations on the company and its subsidiaries. These restrictions encompass various actions, including incurring debt, granting liens and making acquisitions. However, as detailed in their loan agreement, these limitations are subject to customary and agreed-upon constraints.
The company must adhere to a minimum consolidated adjusted EBITDA covenant that is tested every quarter. The loan agreement contains standard events of default, including payment defaults, covenant breaches, insolvency and bankruptcy defaults, cross defaults with other agreements and judgement defaults.
In the event of a default, the lender is entitled to demand prompt payment of all obligations outlined in the loan agreement and pursue additional remedies as prescribed by law. The agreement says a default interest rate, set at 2.00% above the relevant interest rate, may be applied.
Quantic and Lotum both recently chose the Couchbase Capella platform to scale their enterprise and consumer applications at the network edge. Quantic is leveraging Capella to enhance its cloud-based point-of-sale platform. On the other hand, Lotum aims to improve its mobile gaming experience.
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