Section 1.01 Entering into a Material Definitive Agreement.
revolving credit facility (the “Credit Facility”), including a
sub-limit for issuing letters of credit and a swingline sub-facility of up to
Interest on borrowings under the Credit Facility accrues at an annual rate linked to a base rate or the Guaranteed Overnight Funding Rate (“SOFR”), at the option of the Company. Loans based on SOFR bear interest at a rate equal to SOFR plus an applicable margin of between 1.50% and 2.00% based on the Company’s consolidated adjusted quick ratio for the immediately preceding quarter, and loans based on the prime rate bear interest at a rate equal to the prime rate plus an applicable margin between 0.50% and 1.00% based on the Company’s consolidated adjusted quick ratio for the immediately preceding quarter. The Company is required to pay a quarterly commitment fee equal to 0.0625% on the unused portion of the loan commitment.
The obligations under the credit agreement are secured by a lien on almost all of the company’s tangible and intangible assets and by a pledge of all the interests of the direct national subsidiaries of the company and 65% of the capital with voting rights and 100% of the non-voting share capital of any material first-tier foreign subsidiary, subject to limited exceptions. In addition, the Company’s direct domestic subsidiaries guarantee the obligations under the Credit Agreement and grant a lien and pledge, as the case may be, on substantially all of their tangible and intangible property to guarantee the obligations under of the Credit Agreement.
The Credit Agreement contains customary covenants (subject, in each case, to certain exceptions), including restrictions on indebtedness, liens, acquisitions and investments, restricted payments and dispositions, although certain material acquisitions be permitted without the consent of the lenders where the total of the company’s total cash held in
This Summary of Credit Agreement is qualified in its entirety by reference to the full text of the Credit Agreement, which will be filed as an attachment to the Company’s Quarterly Report on Form 10-Q for the quarter ending
Item 2.03 Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement.
The information set out above in point 1.01 is incorporated by reference in this point 2.03.
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