Item 1.01. Entry into a Material Definitive Agreement.
On September 19, 2022, QualTek Services Inc. (the "Company"), through its
wholly-owned subsidiaries QualTek Buyer, LLC and QualTek LLC, entered into an
amendment (the "Amendment") among QualTek Buyer, LLC, QualTek LLC, certain of
the Company's subsidiaries party thereto and PNC Bank, National Association, as
administrative agent, collateral agent and lender (in such capacity, the
"Agent"), to that certain ABL Credit and Guaranty Agreement, dated as of July
18, 2018, among QualTek Buyer, LLC, QualTek LLC, certain of the Company's
subsidiaries party thereto, the Agent, PNC Capital Markets LLC as sole lead
arranger and sole bookrunner, and the lenders party thereto (the "Credit
Agreement", and as amended by the Amendment, the "Amended Credit Agreement").
The Credit Agreement provides for an asset-based revolving credit facility (the
"ABL Facility") with aggregate revolving commitments of $103,500,000, including
a swingline subfacility and a letter of credit subfacility. The Amendment
increased the aggregate revolving commitments by $26,500,000 to $130,000,000 for
the time periods set forth in such Amended Credit Agreement (the "Seasonal
Increase Period"). Interest on the principal amounts outstanding under the
Credit Agreement, payable in arrears monthly, is based on either an elected Base
Rate plus an applicable margin, or an adjusted Eurodollar rate, plus an
applicable margin, as defined in the agreement (the "Applicable Margin"). The
Amendment provides for a 0.50% increase in the Applicable Margin during the
Seasonal Increase Period and a 0.25% increase in the Applicable Margin for all
other time periods. The ABL Facility matures on July 17, 2025, unless required
to mature earlier pursuant to the terms of the Amended Credit Agreement.
The description of the Amendment and the Amended Credit Agreement in this
Current Report on Form 8-K is a summary of, and is qualified in its entirety by,
the terms of the Amendment and the Amended Credit Agreement. A copy of
the Amendment will be filed with the Company's Quarterly Report on Form 10-Q for
the period ending October 1, 2022.
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 under Item 1.01 above regarding the ABL Facility and
the Amended Credit Agreement is incorporated herein by reference.
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