ADC Therapeutics signs $175 million term loan with Owl Rock, Oaktree

Chicago, Aug. 15 – ADC Therapeutics (UK) Ltd. and ADC Therapeutics America, Inc. entered into a loan agreement with Oaktree Capital Management, LP and Owl Rock Capital Advisors LLC as lenders on Aug. 15, according to a 6-K filing with the Securities and Exchange Commission and a press release.

The $175 million loan includes a $120 million initial tranche and up to two additional tranches for $27.5 million each.

Subject to the satisfaction of certain customary conditions, the additional two tranches can be drawn within 18 months of the closing date.

The maturity date is Aug. 15, 2029.

Interest will be at SOFR plus 750 basis points for the first five years and then will step up to SOFR plus 925 bps thereafter. The interest rate has a 1% SOFR floor.

Up to 2.5% of the interest may be paid in kind.

Prepayments may be made before the fourth anniversary with certain premiums.

The lenders received warrants to purchase common shares equal to $4,375,000 divided by the volume weighted-average price of the stock 10 trading days before their issuance and the 10 trading days after their issuance. The lender warrants have an exercise price per share equal to the 20-day VWAP. The warrants are exercisable before Aug. 15, 2032.

The company drew down $120 million principal amount of term loans on Aug. 15.

Morgan Stanley & Co. LLC acted as the placement agent to ADC Therapeutics on this transaction.

Based in Lausanne, Switzerland, ADC is a commercial stage biotechnology company focused on cancer.

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