Item 1.01 Entry into a Material Definitive Agreement.
On
Borrowings under the Revolving Credit Facility will bear interest, at the Company's election, at an annual rate of either (a) LIBOR plus a percentage spread (ranging from 1.75% to 2.50%) or (b) an alternate base rate (as described in the Credit Agreement) plus a percentage spread (ranging from 0.75% to 1.50%), in each case based on the Company's total net leverage ratio. In addition, a commitment fee accrues with respect to the unused amount of the Revolving Credit Facility at an annual rate ranging from 0.25% to 0.40%, based on the Company's total net leverage ratio. The Credit Agreement includes customary LIBOR transition language providing for alternate interest rate options upon the cessation of LIBOR publication.
The Revolving Credit Facility is guaranteed by each of the Company's material domestic subsidiaries and, subject to the absence of materially adverse tax consequences, each of the Company's material foreign subsidiaries. Initially, no foreign subsidiary of the Company is a guarantor.
In connection with the execution of the Credit Agreement, the Company also
entered into a pledge and security agreement (the "Security Agreement") dated as
of
The Credit Agreement provides that the Company must maintain compliance with a maximum consolidated total net leverage ratio covenant, as determined in accordance with the Credit Agreement.
The Credit Agreement also contains affirmative, negative and financial covenants customary for financings of this type, including, among other things, limitations on certain other indebtedness, loans and investments, liens, mergers, asset sales, and transactions with affiliates, as well as customary events of default.
The foregoing descriptions of the Credit Agreement and the Security Agreement do
not purport to be complete and are qualified in their entirety by reference to
the full texts of the Credit Agreement and the Security Agreement, each of which
will be filed with the Company's Quarterly Report on Form 10-Q for the fiscal
quarter ended
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth in Item 1.01 hereof is incorporated herein by reference.
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