Veritone closes $77.5 million four-year term loan via Highbridge

By Marisa Wong

Los Angeles, Dec. 14 – Veritone, Inc. and some of its subsidiaries as guarantors entered into a credit and guaranty agreement on Dec. 13 for a $77.5 million senior secured term loan that was fully drawn at closing, according to an 8-K filing with the Securities and Exchange Commission.

Veritone entered into a commitment letter for the senior secured term loan on Nov. 7 with funds managed by Highbridge Capital Management, LLC and with some other lenders, as previously reported.

A portion of the loan proceeds were used to repurchase $50 million aggregate principal amount of Veritone’s existing 1.75% convertible senior notes due 2026 held by the lenders at a purchase price of $37.5 million plus accrued interest through the closing date of the new loan and to pay fees and out-of-pocket expenses in connection with the credit agreement. The company expects to use the remaining proceeds for general corporate purposes.

The term loan accrues interest at term SOFR plus 850 basis points, with a 3% term SOFR floor.

The credit agreement has a term of four years, with a scheduled maturity date of Dec. 13, 2027. The term loan requires quarterly amortization payments of 2.5% of the principal amount, beginning in June 2024, with the outstanding balance payable at maturity.

In addition, the credit agreement requires mandatory prepayments from proceeds from some asset sales and insurance recoveries on loss of property. The credit agreement also requires prepayment in full if $30 million or more of the aggregate principal amount of the 2026 convertible notes are outstanding on Aug. 14, 2026.

The company may elect to prepay the term loan, in whole or in part, in cash, subject to a make-whole premium during the first year, a 14% prepayment premium during the second year and a 7% premium during the third year.

The term loan is not repayable with the company’s common stock as was initially set forth in the commitment letter, the filing noted.

The credit agreement includes a covenant to maintain unrestricted cash and cash equivalents of at least $15 million at all times.

Wilmington Savings Fund Society, FSB is the administrative agent and collateral agent.

Veritone is a Denver-based AI software and services company.

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