Item 1.01 Entry into a Material Definitive Agreement.
On September 7, 2022 (the "Amendment Date"), TU MidCo, Inc. ("MidCo"), a
wholly-owned subsidiary of TaskUs, Inc. (the "Company"), TU BidCo, Inc. (the
"Borrower"), a direct wholly-owned subsidiary of MidCo, and certain of the
Borrower's other subsidiaries (together with MidCo, the "Guarantors") entered
into an Amended and Restated Credit Agreement (the "Amended and Restated Credit
Agreement") with the lenders party thereto and JPMorgan Chase Bank, N.A., as
administrative agent and collateral agent. The Amended and Restated Credit
Agreement amends and restates the existing Credit Agreement, dated as of
September 25, 2019 (as amended, supplemented or otherwise modified prior to the
Amendment Date, the "Existing Credit Agreement") among MidCo, the Borrower, the
other Guarantors party thereto, the lenders party thereto and JPMorgan Chase
Bank, N.A., as administrative agent and collateral agent.
On the Amendment Date, the Borrower borrowed term loans in an amount equal to
$270,000,000 and received revolving commitments in an amount equal to
$190,000,000. The proceeds of the terms loans were used to refinance outstanding
borrowings under the Existing Credit Agreement and to pay transaction fees and
expenses. The Borrower will be able to draw on the revolving commitments for
working capital and general corporate purposes (including permitted
acquisitions).
Loans made under the Amended and Restated Credit Agreement will bear interest,
at the Borrower's option, either at (i) an adjusted Term SOFR rate plus a margin
of 2.25% per annum, subject to a Term SOFR rate floor of 0.00% or (ii) an
alternative base rate plus a margin of 1.25% per annum, subject to an
alternative base rate floor of 1.00%. The applicable margins have not been
modified from the Existing Credit Agreement other than to replace the adjusted
LIBOR rate with an adjusted Term SOFR rate.
Commencing with the fiscal quarter ending December 31, 2022, the Borrower will
be required to make quarterly amortization payments on the last business day of
each fiscal quarter in an aggregate principal amount equal to 0.25% of the
original principal amount of the term loans for the first year following the
Amendment Date, 0.625% of the original principal amount of the term loans for
the second year following the Amendment Date, 1.25% of the original principal
amount of the term loans for the third year following the Amendment Date, 1.875%
of the original principal amount of the term loans for the fourth year following
the Amendment Date and 2.50% of the original principal amount of the term loans
thereafter until the maturity date of the term loans.
The term loans and revolving commitments under the Amended and Restated Credit
Agreement will mature on the date that is five years following the Amendment
Date.
In addition, the Amended and Restated Credit Agreement amended certain covenants
of the Existing Credit Agreement to provide additional flexibility for the
Borrower, including a financial maintenance covenant, tested as of the last day
of any fiscal quarter, consisting of a consolidated total net leverage ratio not
to exceed 4.00 to 1.00, stepping down to 3.75 to 1.00 commencing with the fiscal
quarter ending September 30, 2024 and stepping down further to 3.50 to 1.00
commencing with the fiscal quarter ending September 30, 2025. All other terms
and collateral securing the loans will remain substantially the same as the
Existing Credit Agreement except as otherwise amended by the Amended and
Restated Credit Agreement.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of the Registrant.
The information set forth in Item 1.01 is incorporated by reference into this
Item 2.03.
Item 7.01 Regulation FD Disclosure.
As previously announced, Bryce Maddock, the Company's Co-Founder and Chief
Executive Officer, and Jarrod Johnson, the Company's Chief Customer Officer,
will participate in a fireside chat at the Citi 2022 Global Technology
Conference starting at approximately 1:45 p.m. Eastern Time on September 7,
2022. The discussion is expected to include certain business updates, including
a reaffirmation of fiscal year 2022 guidance and that the Company's third
quarter 2022 revenues are anticipated to be at or above the top end of the
previously provided guidance range. The fireside chat will be available via live
audio webcast and subsequently as an archived replay in the investor relations
section of the TaskUs website (https://ir.taskus.com/). The contents of the
Company's website are not incorporated by reference into this Current Report on
Form 8-K.
Additionally, on September 7, 2022, the Company issued a press release
announcing the authorization of the stock repurchase program described under
Item 8.01 of this Current Report on Form 8-K. A copy of the press release is
attached as Exhibit 99.1 and is incorporated by reference herein.
The information furnished pursuant to this Item 7.01, including Exhibit 99.1,
shall not be deemed "filed" for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") or otherwise subject to
the liabilities
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under that section and shall not be deemed to be incorporated by reference into
any filings under the Securities Act of 1933, as amended or the Exchange Act,
except as shall be expressly set forth by specific reference in such a filing.
This Current Report on Form 8-K and the press release furnished herewith contain
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements include all statements
that are not historical facts. These statements include, but are not limited to,
statements related to expectations with respect to the Company's third quarter
and full year 2022 financial results. In some cases, you can identify these
forward-looking statements by the use of words such as "outlook," "believes,"
"expects," "potential," "continues," "may," "will," "should," "could," "seeks,"
"predicts," "intends," "trends," "plans," "estimates," "anticipates," "positions
us" or the negative version of these words or other comparable words. Such
forward-looking statements are subject to various risks and uncertainties.
Accordingly, there are or will be important factors that could cause actual
outcomes or results to differ materially from those indicated in these
statements. These factors include but are not limited to those described under
"Risk Factors" in the Company's Annual Report on Form 10-K for the year ended
December 31, 2021 filed with the Securities and Exchange Commission (the "SEC")
on March 9, 2022, as such factors may be updated from time to time in our
periodic filings with the SEC, which are accessible on the SEC's website at
www.sec.gov. These factors should not be construed as exhaustive and should be
read in conjunction with the other cautionary statements that are included in
the Company's SEC filings. The Company undertakes no obligation to publicly
update or review any forward-looking statement, whether as a result of new
information, future developments or otherwise, except as required by law.
Item 8.01 Other Events.
September 7, 2022, the Company announced that the Board of Directors of the
Company authorized a share repurchase program, pursuant to which the Company may
repurchase up to $100.0 million of its Class A common stock through December 31,
2024. The Company may repurchase shares from time to time through open market
purchases, in privately negotiated transactions or by other means, including
through the use of trading plans intended to qualify under Rule 10b5-1 under the
Exchange Act in accordance with applicable securities laws and other
restrictions. Open market repurchases are expected to be structured to occur
within the pricing and volume requirements of Rule 10b-18. The timing and total
amount of stock repurchases will depend upon business, economic and market
conditions, corporate and regulatory requirements, prevailing stock prices,
restrictions under the terms of our loan agreements and other considerations.
This repurchase program terminates on December 31, 2024, and may be modified,
suspended or discontinued at any time at the Company's discretion. The program
does not obligate the Company to acquire any amount of common stock.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description
99.1 Press release of TaskUs, Inc., dated September 7 , 2022
104 Cover Page Interactive Data File (formatted as Inline XBRL)
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