Repay Holdings Corporation filed SEC Form 8-K: Entry into a Material Definitive Agreement, Creation of a Direct Financial Obligation, Regulation FD Disclosure, Financial Statements and Exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
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Item 1.01 Entry into a Material Definitive Agreement.
On July 10, 2024 (the “Closing Date”), Repay Holdings Corporation (the “Company”) and certain of its subsidiaries entered into a Second Amended and Restated Revolving Credit Agreement (the “Amended Credit Agreement”) with certain financial institutions, as lenders, and Truist Bank, as administrative agent. The Amended Credit Agreement amends and restates the Amended and Restated Revolving Credit Agreement (the “Prior Credit Agreement”), dated as of February 3, 2021 (as amended, supplemented and/or modified from time to time prior to the effectiveness of the Amended Credit Agreement), by and among certain subsidiaries of the Company, financial institutions parties thereto as lenders, and Truist Bank, as administrative agent.
The Prior Credit Agreement consisted of a senior secured revolving credit facility in the aggregate principal amount of $185.0 million.
The Amended Credit Agreement establishes a $250.0 million senior secured revolving credit facility (the “Facility”) in favor of Hawk Parent Holdings LLC (“Hawk Parent”), which is a subsidiary of the Company. The Facility is guaranteed by the Company and certain of its subsidiaries. The Facility is secured by a first priority security interest in substantially all tangible and intangible property of the Company and certain of its subsidiaries. The Amended Credit Agreement permits Hawk Parent to increase the principal amount of the Facility subject to lender commitments and other restrictions and conditions.
The Facility matures on the earlier of (a) the fifth anniversary of the Closing Date, (b) the date that is 91 days prior to the maturity date of the Company’s 0.00% Convertible Senior Notes due 2026 (subject to certain exceptions for adequate liquidity) and (c) the date that is 91 days prior to the maturity date of the Company’s 2.875% Convertible Senior Notes due 2029 (subject to certain exceptions for adequate liquidity). The maturity date may be extended, subject to certain terms and conditions. The Facility bears interest at rates based either on Term SOFR, plus a margin of between 1.75% and 2.75%, or, at the Company’s option, a base rate based on the highest of the prime rate, the federal funds rate plus 0.50% and Term SOFR for a one-month interest period plus 1.00%, in each case plus an applicable margin of between 0.75% and 1.75%, with the margin in each case depending upon a total net leverage ratio.
The Company may prepay the Facility without premium.
The Amended Credit Agreement contains certain covenants, including affirmative and operational covenants and restrictive covenants regarding, among other matters, incurrence of debt, incurrence of liens, investments, mergers, dispositions and specified uses of cash (including payment of dividends and distributions). The Amended Credit Agreement also contains covenants requiring the Company to maintain a maximum secured net leverage ratio of 2.0 to 1.0 (or, for a limited period following a material acquisition, 2.5 to 1.0) and a minimum interest coverage ratio of 3.0 to 1.0.
In general, “total net leverage ratio” means, as of any given date, the ratio of consolidated indebtedness of the Company to consolidated EBITDA of the Company (net of qualified cash to the extent described below) for the four consecutive quarters then ended. Similarly, “secured net leverage ratio” means, as of any given date, the ratio of consolidated secured indebtedness of the Company (net of qualified cash to the extent described below) to consolidated EBITDA of the Company for the four consecutive quarters then ended. Lastly, “interest coverage ratio” means, as of any given date, the ratio of consolidated EBITDA of the Company for the four consecutive quarters then ended to the consolidated interest expense of the Company for the same four consecutive quarters.
For purposes of the “total net leverage ratio” and the “secured net leverage ratio,” the Company’s applicable indebtedness will be reduced by the Company’s unrestricted cash and permitted investments not to exceed the greater of (x) $86.0 million and (y) 65% of the consolidated EBITDA of the Company for the four consecutive fiscal quarters then ended.
The administrative agent and the lenders, and certain of their respective affiliates, have provided, and in the future may provide, financial, banking and related services to the Company. These parties have received, and in the future may receive, compensation from the Company for these services.
The foregoing description of the Amended Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the Amended Credit Agreement, a copy of which is filed hereto as Exhibit 10.1 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 set forth under Item 1.01 is incorporated herein by reference.
Item 7.01 Regulation FD Disclosure.
On July 10, 2024, the Company issued a press release announcing the entry into the Amended Credit Agreement. A copy of the press release is attached hereto as Exhibit 99.1 and is hereby incorporated by reference in this Item 7.01.
As provided in General Instruction B.2 of Form 8-K, the information and exhibit contained in this Item 7.01 shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall they be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. |
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Description |
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10.1* |
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Second Amended and Restated Revolving Credit Agreement, dated July 10, 2024, by and among Repay Holdings Corporation, Hawk Parent Holdings LLC, Truist Bank, as Administrative Agent, and the other parties thereto |
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99.1* |
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Press release issued July 10, 2024 |
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104 |
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Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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* |
Filed herewith |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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Repay Holdings Corporation |
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Date: |
July 11, 2024 |
By: |
/s/ Tyler B. Dempsey |
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Tyler B. Dempsey |