Related Party Transactions
RELATED PARTY TRANSACTIONS
TRANSACTIONS WITH RELATED PERSONS
Since January 1,
2020, we have engaged in certain transactions with our directors, executive officers and holders of more than 5% of our voting securities and their affiliates, which we collectively refer to as related persons.
TRANSACTIONS WITH THE MAJORITY SPONSORS
During
part of fiscal year 2020, we were party to consulting services agreements with affiliates of each of Hellman & Friedman and Carlyle pursuant to which we paid such Majority Sponsor affiliates a fee for advisory, consulting and other services
provided to us and our subsidiaries. Pursuant to the agreements, subject to certain conditions, we were required to pay an annual sponsor management fee to such Majority Sponsor affiliates of 0.5% of the preceding years EBITDA (as calculated
according to agreements), calculated annually and payable on a quarterly basis. We also reimbursed such Majority Sponsor affiliates reasonable out-of-pocket
expenses incurred in connection with services provided pursuant to the consulting services agreements. Additionally, we agreed to indemnify such Majority Sponsor affiliates against all actions, causes of action, suits, claims, liabilities, losses,
damages, costs and expenses incurred by such Majority Sponsor affiliates in connection with the services provided by such Majority Sponsor affiliates to us pursuant to the consulting services agreements. During fiscal year 2020, we
incurred $0.4 million for out-of-pocket expenses and services rendered under the consulting services agreements. The consulting services agreements terminated
pursuant to their terms upon completion of our IPO on February 10, 2020.
On August 18, 2015, Jaguar Holding Company II and Pharmaceutical Product
Development, LLC entered into the senior secured credit facilities (the 2015 Credit Agreement) that, as amended, provided for a $3.1 billion senior secured term loan (the 2015 Term Loan). Borrowings under the 2015 Term
Loan bore interest at a variable rate, at the Companys option, of either (i) a Eurocurrency rate based on LIBOR for a specific interest period plus an applicable margin, subject to a Eurocurrency rate floor of 1.00%, or (ii) an
alternate base rate plus an applicable margin, subject to a base rate floor of 2.00%. The margins for the 2015 Term Loan were fixed at 2.50% per annum for Eurocurrency rate loans and 1.50% per annum for base rate loans. During fiscal year 2020, the
interest rate on the 2015 Term Loan was based on the Eurocurrency loan rate. During fiscal year 2020, we paid $115.1 million of interest and $32.4 million of principal for the 2015 Term Loan. The largest amount of principal
outstanding during fiscal year 2020 was $3.1 billion. During fiscal year 2020, we paid $1.6 million of interest and $0.4 million of principal to affiliates of Carlyle, one of our Majority Sponsors, for the 2015 Term Loan.
On January 13, 2021, the Company and PPD Development, L.P. entered into new senior secured credit facilities (the New Credit Agreement) that provided
for a $3.1 billion senior secured term loan (the New Term Loan). Borrowings under the New Term Loan bear interest at a variable rate, at the Companys option, of either (i) a Eurocurrency rate based on LIBOR for a specific
interest period plus an applicable margin, subject to a Eurocurrency rate floor of 0.50%, or (ii) an alternate base rate plus an applicable margin, subject to a base rate floor of 1.50%. The margins for the New Term Loan are fixed at 2.25% per
annum for Eurocurrency rate loans and 1.25% per annum for base rate loans. The interest rate on the New Term Loan is currently based on the Eurocurrency loan rate. As of February 19, 2021, the amount of the New Term Loan outstanding was
$3,050.0 million. Affiliates of Carlyle, one of the Majority Sponsors, had funded commitments in the New Term Loan totaling $88.1 million as of February 19, 2021.
RECAPITALIZATION AND RELATED TRANSACTIONS
In May
2017, the Company and the Majority Sponsors completed a recapitalization (the Recapitalization) of Jaguar Holding Company I (Jaguar I), the then indirect parent of Pharmaceutical Product Development, LLC and now indirect
wholly owned subsidiary of the Company. The Recapitalization was effected through two mergers that resulted in Jaguar I becoming an indirect wholly owned subsidiary of the Company. Prior to the Recapitalization, Jaguar I was majority owned and
jointly controlled by the Majority Sponsors. Subsequent to the Recapitalization, the Company, and indirectly, Jaguar I, continue to be majority owned and jointly controlled by the Majority Sponsors, through different affiliated investment funds, by
rolling over existing equity and investing new equity of the Majority Sponsors into the Company, in connection with the Recapitalization. Additionally, GIC and ADIA both obtained direct minority ownership interests in the Company through the
Recapitalization. Prior to the Recapitalization, the controlling Majority Sponsors owned approximately 99.4% of the Company, with the remainder owned by management and the independent directors. Subsequent to the Recapitalization, the controlling
Majority Sponsors owned approximately 80.6% of the Company, GIC and ADIA owned approximately 18.3% of the Company, and the remainder was owned by management and the independent directors.
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