Waldencast Acquisition Corp., a special purpose acquisition company, announced that, on June 24, 2022, its wholly-owned subsidiary Waldencast Finco Limited entered into a Credit Agreement, by and among Waldencast Finco, as the borrower (the “Borrower”), Waldencast Partners LP, as the parent guarantor, the lenders party thereto and JPMorgan Chase Bank, as administrative agent. Credit Suisse AG, New York Branch acted as documentation agent and JPMorgan Chase Bank, Banco Santander, and Wells Fargo Securities acted as joint bookrunners and joint lead arrangers under the Waldencast Credit Agreement.

As a result of the entry into the Waldencast Credit Agreement, Waldencast will receive aggregate proceeds of up to approximately $1.02 billion (if no Waldencast shareholders exercise their rights to redeem their shares). This includes, in addition to the $225 million debt facility described above, the following previously announced commitments:

• Forward Purchase Agreements with Burwell Mountain Trust, Dynamo Master Fund (each members of Waldencast Long-Term Capital LLC, Waldencast's sponsor) and Beauty Ventures LLC in the aggregate total amount of $333 million.
• PIPE commitments with certain PIPE investors in the aggregate total amount of $113 million.
• Waldencast’s SPAC proceeds of $345 million (if no Waldencast shareholders exercise their right to redeem their shares).

Michel Brousset, Waldencast Founder and CEO, said: “We are pleased to enter into a new credit agreement which reflects the strength of our business model, cash flow generation, and ability to generate long term profitable growth. Interest expense associated with the Waldencast Credit Agreement will represent approximately half of the borrowing cost of the Existing Credit Agreements, and accordingly, an encouraging expression of confidence by an outstanding group of first-tier financial institutions. We thank JPMorgan, Banco Santander, Wells Fargo, and Credit Suisse for their support.”

The Waldencast Credit Agreement provides for a four-year secured first-lien (i) term loan facility in an aggregate principal amount of $175 million and (ii) revolving loan facility in an aggregate principal amount of up to $50 million (of which an aggregate principal amount of up to $7.5 million will be available, at the Borrower’s option, to be drawn in the form of letters of credit) (collectively, the “Waldencast Credit Facilities”). The initial borrowings under the Waldencast Credit Agreement will be subject to negotiated limited conditions precedent and are expected to become available on the Funding Date (as defined in the Waldencast Credit Agreement).

Proceeds from the borrowings under the Waldencast Credit Facilities may be used to: (i) pay the cash consideration due to the equity holders of Milk Makeup and Obagi Skin Care upon consummation of the transactions contemplated by the Transaction Agreements, (ii) repay in full all outstanding amounts under, and terminate, the Existing Credit Agreements and (iii) fund working capital needs or other general corporate purposes of Waldencast.

As previously disclosed, on November 15, 2021, Waldencast entered into (i) an Agreement and Plan of Merger (the “Obagi Merger Agreement”), by and among Waldencast, Obagi Merger Sub, Inc., a Cayman Islands exempted company limited by shares and an indirect wholly owned subsidiary of Waldencast, and Obagi Global Holdings Limited, a Cayman Islands exempted company limited by shares (“Obagi Skin Care”), and (ii) an Equity Purchase Agreement (the “Milk Equity Purchase Agreement” and together with the Obagi Merger Agreement, the “Transaction Agreements”), by and among Waldencast, Obagi Holdco 1 Limited, a limited company incorporated under the laws of Jersey, Waldencast Partners LP, a Cayman Islands exempted limited partnership, Milk Makeup LLC, a Delaware limited liability company (“Milk Makeup”), certain members of Milk Makeup and Shareholder Representative Services LLC, a Colorado limited liability company, solely in its capacity as representative of Milk Makeup’s equity holders.