Item 1.01. Entry into a Material Definitive Agreement
On
The interest rate per annum applicable to loans under the Revolving Credit Facility, will be, in the case of a swing loan, the base rate, or, in the case of all other loans made under the Revolving Credit Facility and at the Company's option, equal to either (i) the relevant Eurodollar rate for the selected interest rate period or (ii) the base rate plus, in each case, the applicable margin. The base rate is, for any day, the highest of (a) the Administrative Agent's prime rate, (b) 0.5% in excess of the federal funds effective rate, and (c) 100 basis points above LIBOR for Eurodollar loans over a period of one month. The applicable margin is based on the Company's leverage ratio and ranges between 0.875% and 1.5% for LIBOR-based borrowings and 0% and 0.5% for base rate borrowings.
The obligations of the Company under the Credit Agreement have been guaranteed by certain of the Company's subsidiaries party thereto (the "Guarantors"). The obligations of the Company and the Guarantors under the Credit Agreement are, subject to certain exceptions, secured by a pledge of all of the capital stock of certain domestic subsidiaries owned by the Company and each Guarantor and a security interest in substantially all of the Company's tangible and intangible assets and the tangible and intangible assets of each Guarantor.
The Credit Agreement contains financial covenants that requires the Company to maintain (i) a leverage ratio of consolidated indebtedness to consolidated Adjusted EBITDA of no more than 3.25 to 1.00 and (ii) an interest coverage ratio of consolidated EBIDTA to consolidated interest expense of at least 3.00 to 1.00. The Credit Agreement also contains customary affirmative and negative covenants for credit facilities of this type, including limitations on the Company and the Guarantors with respect to indebtedness, liens, investments, mergers and acquisitions, dispositions of assets, transactions with affiliates, payments of dividends and repurchases of capital stock. The Credit Agreement provides for customary events of default. Upon the occurrence and during the continuance of an event of default, the commitments of the lenders may be terminated and all outstanding obligations of the loan parties under the Credit Agreement may be declared immediately due and payable.
The foregoing description of the Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Credit Agreement, a copy of which is attached hereto as Exhibit 10.1 and incorporated herein by reference.
Item 2.01. Completion of Acquisition or Disposition of Assets
On
The material terms of the Merger Agreement were previously reported in Item 1.01
of the Company's Current Report on Form 8-K filed on
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Item 2.02. Results of Operations and Financial Condition
On
The information contained in this Current Report of Form 8-K, including Exhibit
99.1, is being furnished and shall not be deemed "filed" by the Company with the
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 above in Item 1.01 is incorporated by reference into this Item 2.03.
Item 9.01. Financial Statements and Exhibits
(a) Financial Statements of Businesses Acquired.
The financial statements required by Item 9.01(a) of Form 8-K will be filed by
amendment of this Current Report on Form 8-K no later than
(b) Pro Forma Financial Information.
The pro forma financial information required by Item 9.01(b) of Form 8-K will be
filed by amendment of this Current Report on Form 8-K no later than
(d) Exhibits. Exhibit No. Description 10.1* Credit Agreement, dated as ofJanuary 27, 2020 , by and amongK12 Inc. , the guarantors party thereto, the lenders party thereto,PNC Bank, National Association , as administrative agent. 99.1K12 Inc. Earnings Press Release, datedJanuary 27, 2020 . 104 Cover Page Interactive Data File (embedded within the Inline XBRL document).
* Schedules and exhibits omitted pursuant to Item 601(a)(5) of Regulation S-K.
Copies of any omitted schedule or exhibit will be furnished to the
request.
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