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OFFON

CONSTRUCTION PARTNERS, INC.

(ROAD)
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CONSTRUCTION PARTNERS, INC. : Entry into a Material Definitive Agreement (form 8-K)

06/25/2021 | 04:18pm EDT

Item 1.01. Entry into a Material Definitive Agreement.


On June 24, 2021 (the "Restatement Date"), Construction Partners, Inc. (the
"Company") and each of its wholly owned subsidiaries (collectively, the
"Borrowers") entered into a Second Amended and Restated Credit Agreement with
BBVA USA ("BBVA"), as administrative agent, joint lead arranger, sole bookrunner
and lender, Regions Bank and BofA Securities, Inc., each as a joint arranger,
and certain other lenders party thereto (the "Second Amended and Restated Credit
Agreement"), which amended and restated in its entirety the Amended and Restated
Credit Agreement, dated as of July 30, 2020, by and among the Company and each
of its wholly owned subsidiaries, as borrowers, BBVA USA, as agent, sole lead
arranger and sole bookrunner, and certain other lenders party thereto (the
"Existing Credit Agreement").
Among other things, the Second Amended and Restated Credit Agreement provides
for (i) a term loan facility in an initial aggregate principal amount of
$200,000,000 (the "Term Loan"), the full amount of which was drawn on the
Restatement Date, and (ii) a revolving credit facility in an initial aggregate
principal amount of $225,000,000, including a $25,000,000 sublimit for the
issuance of standby letters of credit (the "Revolving Credit Facility"). The
proceeds of the loans advanced under the Second Amended and Restated Credit
Agreement will be used for purposes of (a) refinancing indebtedness of the
Borrowers under the Existing Credit Agreement, (b) paying fees and expenses
incurred in connection with the Second Amended and Restated Credit Agreement and
(c) other general corporate purposes of the Borrowers, including permitted
acquisitions.
In addition to the advances under the Term Loan and Revolving Credit Facility,
the Borrowers may request one or more incremental term loans or an increase in
the commitments under the Revolving Credit Facility (in either case, an
"Incremental Facility") in an aggregate principal amount of up to the greater of
(i) $120,000,000 and (ii) the amount of the consolidated EBITDA of the Borrowers
and their subsidiaries for the immediately preceding four-fiscal-quarter period,
on the same terms as the Term Loan or Revolving Facility, as applicable,
including pricing, and, in the case of an Incremental Facility that is a term
loan (an "Incremental Term Loan"), the then-applicable amortization rate. The
availability of one or more Incremental Facilities is subject to the
satisfaction of certain conditions, including, among other things, that the
Borrowers' consolidated net leverage ratio may not be greater than 2.75:1.0 on a
pro forma basis (assuming that the Incremental Facility is fully drawn and after
giving effect to any permitted acquisitions, refinancing of debt or other event
giving rise to pro forma adjustments).
All outstanding advances under the Term Loan and Revolving Credit Facility are
due and payable in full on June 24, 2026 (the "Maturity Date"). The Term Loan
and any Incremental Term Loan will amortize in quarterly installments commencing
on September 30, 2021 in an amount, subject, in each case, to adjustments for
prior mandatory and voluntary prepayments of principal, equal to: (a) 1.25% of
the original principal amount of the Term Loan Facility (and, to the extent any
Incremental Term Loans are then outstanding, the original principal amount of
such Incremental Term Loans) on September 30, 2021 and continuing on each of the
following eleven quarter-end payment dates; (b) 1.875% of the original principal
amount of the Term Loan Facility (and, to the extent any Incremental Term Loans
are then outstanding, the original principal amount of such Incremental Term
Loans) on each of the next seven quarter-end payment dates; and (c) all
remaining principal of the Term Loan Facility and all Incremental Term Loans are
due on the Maturity Date.
The obligations of the Borrowers under the Second Amended and Restated Credit
Agreement and the other loan documents delivered in connection therewith are
secured by a first priority security interest in substantially all of the
existing and future personal property of the Borrowers and the equity interests
of each of the Borrowers (other than the Company) and of their present and
future subsidiaries.
The annual interest rates applicable to advances made under the Second Amended
and Restated Credit Agreement will be calculated, at the Company's option, by
using either a base rate or LIBOR, in each case plus an applicable margin
percentage that corresponds to the Company's consolidated net leverage ratio.
Upon the occurrence of certain triggering events relating to the end of the
LIBOR reference rate, the Borrowers and BBVA will select a different benchmark
rate to replace LIBOR as the reference rate for interest accruing on certain
advances.
The Second Amended and Restated Credit Agreement contains customary
representations and warranties and certain covenants that limit (subject to
certain exceptions) the ability of the Borrowers to, among other things, (i)
incur or guarantee additional indebtedness, (ii) incur or suffer to exist liens
securing indebtedness, (iii) make investments, (iv) consolidate, merge or
transfer all or substantially all of their assets, (v) sell assets, (vi) pay
dividends or other distributions on, or redeem or repurchase, capital stock,
(vii) enter into transactions with affiliates, and (viii) enter into operating
leases. In addition, the Second Amended and Restated Credit Agreement contains
financial covenants that require the Company's (i) consolidated leverage ratio
to be less than certain maximum levels and (ii) fixed charge coverage ratio to
exceed certain minimum levels, in each case, as defined and calculated according
to the procedures set forth in the Second Amended and Restated Credit Agreement.

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The Second Amended and Restated Credit Agreement also contains customary events
of default. If such an event of default occurs, the lenders would be entitled to
take various actions, including the acceleration of amounts due under the Second
Amended and Restated Credit Agreement and actions permitted to be taken by a
secured creditor.
The lenders that are parties to the Second Amended and Restated Credit Agreement
and their respective affiliates are full-service financial institutions engaged
in various activities, which may include sales and trading, commercial and
investment banking, advisory, investment management, investment research,
principal investment, hedging, market making, brokerage, and other financial and
non-financial activities and services. Certain of these financial institutions
and their respective affiliates have provided, and may in the future provide,
certain of these services to the Borrowers and to persons and entities with
relationships with the Borrowers, for which they received or will receive
customary fees and expenses.
The foregoing summary of the Second Amended and Restated Credit Agreement is a
summary only and does not purport to be complete and is subject to, and
qualified in its entirety by, the full text of the Second Amended and Restated
Credit Agreement, a copy of which is filed as Exhibit 10.1 to this Current
Report on Form 8-K and is incorporated by reference into this Item 1.01.
Item 1.02. Termination of a Material Definitive Agreement.
The information set forth above in Item 1.01 of this Current Report on Form 8-K
with regard to the Existing Credit Agreement 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 set forth above in Item 1.01 of this Current Report on Form 8-K
with regard to the Second Amended and Restated Credit Agreement is incorporated
herein by reference.
Item 8.01. Other Events
On June 22, 2021, the Company issued a press release announcing its completion
of an acquisition transaction. A copy of the press release is furnished as
Exhibit 99.1 hereto, and the information contained in Exhibit 99.1 is
incorporated herein by reference.
Item 9.01.    Financial Statements and Exhibits.
(d) Exhibits
   Exhibit No.    Description
     10.1*†         Second Amended and Restated Credit Agreement, dated as of June 24, 2021, by
                  and among Construction Partners, Inc. and each of its wholly owned subsidiaries,
                  as borrowers, BBVA USA,     as administrative agent, joint lead arranger, sole
                  bookrunner and lender, Regions Bank and     BofA Securities, Inc.    , each as a
                  joint arranger, and certain other lenders party thereto
     99.1**         Press release dated June 22, 2021
      104*        Cover Page Interactive Data File (embedded within the Inline XBRL document)



* Filed herewith.
**Furnished herewith.
† Schedules and exhibits have been omitted pursuant to Item 601(a)(5) of
Regulation S-K. The Company agrees to furnish to the Securities and Exchange
Commission a copy of any omitted schedule or exhibit upon request.

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© Edgar Online, source Glimpses

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