On September 14, 2021, Oaktree Capital Management, L.P., Oaktree Capital II, L.P., Oaktree AIF Investments, L.P., and Oaktree Capital I, L.P. (collectively, the “Borrowers”) entered into the Sixth Amendment to Credit Agreement (the “Sixth Amendment”), which amends the Credit Agreement, dated as of March 31, 2014 (as amended through and including the Sixth Amendment, the “Credit Agreement”), by and among the Borrowers, Wells Fargo Bank, National Association (“Wells Fargo”) and the other lenders party thereto. Wells Fargo acts as administrative agent, lender, letter of credit issuer and swing line lender thereunder. All of the Borrowers are owned directly or indirectly by Oaktree Capital Group Holdings, L.P. and Brookfield Asset Management Inc. (“Brookfield”). Brookfield holds all of the Class A common units of Oaktree Capital Group, LLC (the “Company”), which represent all of the common economic interests in the Company.
The Sixth Amendment extends the maturity date of the Credit Agreement from December 13, 2024 to September 14, 2026, with the potential to extend the maturity for up to two additional years and modifies the assets under management covenant threshold from $65,000,000,000 of assets under management to $57,500,000,000 of management fee-generating assets under management. The Sixth Amendment also increases the maximum leverage ratio to 4.00 to 1.00 and makes certain other changes to the provisions of the Credit Agreement.
Certain of the lenders under the Credit Agreement, or their affiliates, have in the past performed, and may in the future from time to time perform, investment banking, financial advisory, commercial banking, and other services in the ordinary course of business for the Company and its subsidiaries, for which they have received, and may in the future receive, customary compensation and, in some cases, customary indemnification and/or reimbursement of expenses.
The foregoing description is a summary and is qualified in its entirety by reference to the complete text of the Sixth Amendment filed as Exhibit 10.1 hereto and incorporated herein by reference, as well as the complete text of the Credit Agreement. A copy of the Credit Agreement was filed as Exhibit 10.1 to a Current Report on Form 8-K filed with the SEC on April 4, 2014. A copy of the First Amendment to Credit Agreement, dated as of November 3, 2014, was filed as Exhibit 10.1 to a Quarterly Report on Form 10-Q filed with the SEC on November 7, 2014. A copy of the Second Amendment to Credit Agreement, dated as of March 31, 2016, was filed as Exhibit 10.1 to a Current Report on Form 8-K filed with the SEC on April 6, 2016. A copy of the Third Amendment to Credit Agreement, dated as of November 14, 2017, was filed as Exhibit 10.9.3 to an Annual Report on Form 10-K filed with the SEC on February 23, 2018. A copy of the Fourth Amendment to Credit Agreement, dated as of March 29, 2018, was filed as Exhibit 10.1 to a Current Report on Form 8-K filed with the SEC on April 4, 2018. A copy of the Fifth Amendment to Credit Agreement, dated as of December 13, 2019, was filed as Exhibit 10.1 to a Current Report on Form 8-K filed with the SEC on December 18, 2019.
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Item 9.01
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Financial Statements and Exhibits.
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(d) Exhibits
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Exhibit No.
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Description
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Sixth Amendment to Credit Agreement, dated as of September 14, 2021, by and among Oaktree Capital Management, L.P., Oaktree Capital II, L.P., Oaktree AIF Investments, L.P., Oaktree Capital I, L.P., the Lenders party thereto, and Wells Fargo Bank, National Association, as administrative agent for the Lenders.
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Forward-Looking Statements and Information
This Current Report contains forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”), which reflect the current views of the Company, with respect to, among other things, its future results of operations and financial performance. In some cases, you can identify forward-looking statements by words such as “anticipate,” “approximately,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “outlook,” “plan,” “potential,” “predict,” “seek,” “should,” “will” and “would” or the negative version of these words or other comparable or similar words. These statements identify prospective information. Important factors could cause actual results to differ, possibly materially, from those indicated in these statements. Forward-looking statements are based on the Company’s beliefs, assumptions and expectations of its future performance, taking into account all information currently available to the Company. Such forward-looking statements are subject to risks and uncertainties and assumptions relating to the Company’s operations, financial results, financial condition, business prospects, growth strategy and liquidity.
In addition to factors previously disclosed in the Company’s reports filed with securities regulators in the United States and those identified elsewhere in this Current Report, the following factors, among others, could cause actual results to differ materially from forward-looking statements and information or historical performance: course and severity of the novel coronavirus (including any subsequent variants, “COVID-19”) pandemic and its direct and indirect business impacts; disruptions resulting from the completion of the merger between an affiliate of Brookfield and the Company that closed on September 30, 2019 that will impact the Company’s business, including current plans and operations; potential adverse reactions or changes to business relationships resulting from the completion of the merger; certain legal or regulatory restrictions resulting from the completion of the merger that may impact the Company’s ability to pursue certain business opportunities or strategic transactions; the ability of the Company to retain and hire key personnel; the continued availability of capital and financing following the merger; the business, economic and political conditions in the markets in which the Company operates; changes in the Company’s anticipated revenue and income, which are inherently volatile; changes in the value of the Company’s investments; termination or amendment (including fee amendments) of certain service or sub-advisory agreements that generate revenues for the Company that are between the Company and its subsidiaries on the one hand and certain affiliates of the Company on the other hand; the pace of the Company’s raising of new funds; changes in assets under management; the timing and receipt of, and impact of taxes on, carried interest; distributions from and liquidation of the Company’s existing funds; the amount and timing of distributions on the Company’s preferred units; changes in the Company’s operating or other expenses; the degree to which the Company encounters competition; and general political, economic and market conditions.
Any forward-looking statements and information speak only as of the date of this Current Report or as of the date they were made, and except as required by law, the Company does not undertake any obligation to update forward-looking statements and information. For a more detailed discussion of these factors, also see the information under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s most recent report on Form 10-K for the year ended December 31, 2020, and in each case any material updates to these factors contained in any of the Company’s future filings.
This Current Report and its contents do not constitute and should not be construed as (a) a recommendation to buy, (b) an offer to buy or solicitation of an offer to buy, (c) an offer to sell or (d) advice in relation to, any securities of the Company or securities of any Company investment fund.