Summary
Cloudflare, Inc. (NET) has entered into a new senior secured $400.0 million revolving credit facility, maturing on May 17, 2029. This facility, with Citibank, N.A. as the administrative agent, provides the company with significant financial flexibility for working capital and general corporate purposes. The credit agreement includes an option to increase the facility by up to $150.0 million under certain conditions. As of the closing date, no funds were drawn, indicating a proactive approach to liquidity management. The facility's terms include covenants that will require Cloudflare to maintain specific financial ratios, such as a maximum consolidated net leverage ratio and a minimum interest coverage ratio. The agreement also includes customary events of default and provisions for accelerated repayment. Notably, the facility's maturity date may be advanced to align with the maturity of Cloudflare's 2026 Convertible Senior Notes if certain liquidity conditions are not met 91 days prior to the notes' maturity.
Key Highlights
- 1Cloudflare secured a new $400 million senior secured revolving credit facility, maturing in May 2029.
- 2The facility provides flexibility for working capital and general corporate purposes.
- 3There is an option to increase the facility size by up to $150 million, subject to lender commitments.
- 4As of the agreement's closing, no borrowings or letters of credit were outstanding under the new facility.
- 5The credit agreement includes financial covenants requiring maintenance of specific leverage and interest coverage ratios.
- 6The facility's maturity date may be automatically extended to match the maturity of outstanding 2026 Convertible Senior Notes if certain conditions are met 91 days prior to the notes' maturity.
- 7The credit facility is secured by substantially all of the personal property of Cloudflare and its material domestic subsidiaries.