Item 1.01 Entry into a Material Definitive Agreement.
Amendment to Senior Credit Facility
On
The foregoing description does not purport to be complete and is qualified in its entirety by reference to the Amendment to the Company's Senior Credit Facility, which is attached as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Term Loan
Also on
The Credit Agreement, effective
At the Company's election,
The Company also pays a commitment fee to the Lenders under the Term Loan Facility on the average amount by which the aggregate commitments of the Lenders' exceed utilization of the Term Loan Facility ranging from 0.080% to 0.200% per annum. The applicable margins and the commitment fee are determined based on whichever of the Company's Consolidated Net Leverage Ratio or its senior unsecured debt rating (or if not available, corporate family rating) results in the lower applicable margins and commitment fee (with applicable margins and the commitment fee increasing as that ratio increases or those ratings decline, as applicable).
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The Company can use the proceeds of the Term Loan Facility to finance ongoing working capital requirements and other general corporate purposes.
The obligations of the Company and its subsidiaries in respect of the Term Loan Facility are unsecured.
All obligations of the Company under the Term Loan Facility are guaranteed by the domestic subsidiary guarantors party to the Term Loan Facility.
The Term Loan Facility includes certain affirmative and negative covenants that impose restrictions on the Company's financial and business operations, including limitations on liens, indebtedness, fundamental changes, changes in the nature of the Company's business. Many of these limitations are subject to numerous exceptions. The Company is also required to maintain a Consolidated Interest Coverage Ratio of at least 3.5 to 1.0 as of the last day of any fiscal quarter.
The Term Loan Facility also contains customary representations and warranties.
The Term Loan Facility contains events of default customary for this type of financing, including a cross default and cross acceleration provision to certain other material indebtedness of the Company. Upon the occurrence of an event of default, the outstanding obligations under the Term Loan Facility may be accelerated and become due and payable immediately. In addition, if certain change of control events occur with respect to the Company, the Company is required to repay the loans outstanding under the Term Loan Facility.
The foregoing description does not purport to be complete and is qualified in its entirety by reference to the Credit Agreement, which is attached as Exhibit 10.2 to this Current Report on Form 8-K 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 described under Item 1.01 above "Entry into a Material Definitive Agreement" is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
The documents included as exhibits to this Current Report on Form 8-K are filed solely to provide information about their terms, are not intended to provide any factual or other information about the Company or the other parties to the agreements, and should not be relied upon by investors for any other purpose.
(d) Exhibits
10.1 Fourth Amendment to Second Amended and Restated Credit Agreement, dated as ofAugust 12, 2022 , by and among the Company and certain of its subsidiaries, as borrowers,Wells Fargo Bank, National Association , as administrative agent, swing line lender, and an L/C issuer, and the other lenders party thereto. 10.2 Credit Agreement, dated as ofAugust 12, 2022 , by and among the Company andMohawk International , as borrowers, certain of its subsidiaries, as guarantors,Wells Fargo Bank, National Association , as administrative agent, and the lenders party thereto. 104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
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