Item 1.01 Entry into a Material Definitive Agreement
On
All of the indebtedness outstanding under the Credit Agreement is guaranteed by the Company's current and future domestic subsidiaries (other than certain excluded subsidiaries).
The loans under the Credit Agreement will bear interest per annum, at the Company's election, equal to:
· an alternate base rate plus the applicable margin for such loans. The alternate
base rate is the greatest of (a) the Federal Funds Effective Rate plus 1/2 of 1%, (b) the rate of interest last quoted by The Wall Street Journal as the "Prime Rate" in the US and (c) the adjusted Term SOFR rate for a one-month interest period beginning on such day plus 1.00%; or
· the Term SOFR rate for the selected interest period plus the applicable margin
for such loans.
The applicable margin ranges from 2.25% to 1.50% for borrowings based on the Term SOFR rate and 1.25% to 0.50% for borrowings based on the alternate base rate depending on the Company's leverage ratio.
Customary fees are payable in respect of the Credit Agreement, including letter of credit fees and commitment fees.
The Credit Agreement includes a number of negative covenants that, among other things, limit or restrict the ability of the Company and its other subsidiaries (including the guarantors) to, subject to certain exceptions, incur additional indebtedness (including guarantees), grant liens, make investments, make dividends or distributions with respect to the Company's capital stock, make prepayments on other indebtedness, engage in mergers or change the nature of the business of the Company or its other subsidiaries (including the guarantors). In addition, the Company is required to comply with a leverage ratio of 5.00 to 1.00 (with a step up to 5.50 to 1.00 for the three consecutive fiscal quarters ended immediately following the consummation of a qualified acquisition).
The Credit Agreement also contains certain affirmative covenants, including financial and other reporting requirements, applicable to the Company and its other subsidiaries (including the guarantors).
A copy of the Credit Agreement is attached as Exhibit 10.1 and is incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant
The information provided in Item 1.01 of this Form 8-K is hereby incorporated by reference into this Item 2.03.
Item 8.01 Other Information
On
The press release relating to the Credit Agreement is attached as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits
(d) The following exhibits are included with this report:
Exhibit No. Description 10.1 Credit Agreement, datedJanuary 11, 2023 , betweenService Corporation International ,JPMorgan Chase Bank, N.A ., as administrative agent, and certain other financial institutions, as lenders party thereto 99.1 Press Release datedJanuary 11, 2023 104 Cover Page Interactive Data File (formatted as Inline XBRL)
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