Current Report Filing (8-k)
May 11 2020 - 4:03PM
Edgar (US Regulatory)
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2020-05-10
2020-05-11
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
May 11, 2020
TEXAS ROADHOUSE, INC.
(Exact name of registrant as specified in
its charter)
Delaware
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000-50972
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20-1083890
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(State or other jurisdiction
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(Commission
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(IRS Employer
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of incorporation)
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File Number)
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Identification No.)
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6040 Dutchmans Lane, Louisville, KY
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40205
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number, including
area code (502) 426-9984
N/A
(Former name or former address, if changed
since last report.)
Check the appropriate box below if the Form 8-K filing
is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see
General Instruction A.2. below):
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant
to Section 12(b) of the Act:
Title of each Class
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Trading
Symbol(s)
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Name of each exchange on which registered
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Common Stock, par value $0.001 per share
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TXRH
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Nasdaq Global Select Market
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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).
Emerging
growth company
¨
If an emerging
growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with
any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
¨
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Item 1.01
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Entry into a Material Definitive Agreement
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As previously disclosed, Texas Roadhouse,
Inc. and certain of its subsidiaries are parties to that certain Amended and Restated Credit Agreement dated August 7, 2017 (the
“Amended Credit Agreement”). The Amended Credit Agreement is a revolving credit agreement under which we can borrow
up to $200.0 million with the option to increase the credit facility by an additional $200.0 million (subject to certain limitations
set forth in the Amended Credit Agreement). The material terms of the Amended Credit Agreement are described under “Note
5 – Long-term Debt” of the Notes to Consolidated Financial Statements for Texas Roadhouse, Inc. and its subsidiaries,
which Note 5 is included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2019, filed with the Securities
and Exchange Commission on February 28, 2020, and which description is incorporated herein by reference.
As further disclosed, we previously borrowed
a total of $190.0 million under our Amended Credit Agreement in two separate transactions during March. Following the receipt of
such transactions, we had a total of $198.2 million outstanding (including $8.2 million of outstanding letters of credit) under
the Amended Credit Agreement. The current interest for such borrowings under the Amended Credit Agreement is a blended rate of
approximately 2.27%.
On May 11, 2020 and as a precautionary measure,
we entered into that certain Amendment No. 1 to Amended and Restated Credit Agreement (the “Amendment”) amending the
terms and conditions of the Amended Credit Agreement with a syndicate of commercial lenders led by JPMorgan Chase Bank, N.A., PNC
Bank, National Association, Wells Fargo Bank, National Association, U.S. Bank National Association, and Old National Bank. The
Amendment provides for a senior 364-day incremental revolving credit facility under the Amended Credit Agreement in the aggregate
principal amount of up to $82.5 million. These amounts are applied against the additional $200.0 million that was otherwise available
under the Amended Credit Agreement so that we have the ability to increase the credit facility under the Amended Credit Agreement,
as amended by the Amendment, by an additional $117.5 million following the execution of the Amendment (subject to certain limitations
described in the Amended Credit Agreement). The maturity date for such incremental revolving credit facility is May 10, 2021; however,
the maturity date for all other borrowings under the Amended Credit Agreement remains August 5, 2022.
Under the Amendment,
with respect to any borrowing other than the incremental revolving credit facility described in the Amendment, we are required
to pay interest on any outstanding borrowing at LIBOR plus 1.50% and to pay a commitment fee of 0.25% per year for any unused portion
of the credit facility through the end of the first quarter of our 2021 fiscal year. Subsequent to the first quarter of our 2021
fiscal year, we are required to pay interest on our outstanding borrowing at LIBOR plus 0.875% to 2.250% and to pay a commitment
fee of 0.125% to 0.400% per year for any unused portion of the credit facility, in each case depending on our leverage ratio. With
respect to the incremental revolving credit facility described in the Amendment, we are required to pay interest on any outstanding
borrowing at LIBOR plus 2.250% and to pay a commitment fee of 0.500% per year for any unused portion of the incremental revolving
credit facility. The Amendment also provides an Alternate Base Rate that may be substituted for LIBOR for any borrowings outstanding.
The Amendment also
modifies the financial covenants contained in the Amended Credit Agreement. The Amended Credit Agreement, as amended by the Amendment,
imposes the financial covenants of maintaining a fixed charge coverage ratio to be less than the following: (i) 1.00 to 1.00 for
the second, third and fourth fiscal quarters for our 2020 fiscal year and the first fiscal quarter for our 2021 fiscal year; and
(ii) 2.00 to 1.00 for each fiscal quarter thereafter. Additionally, the Amended Credit Agreement, as amended by the Amendment,
imposes the financial covenants of maintaining a maximum leverage ratio to be less than the following: (a) 3.50 to 1:00 for the
second fiscal quarter for our 2020 fiscal year; (b) 4.50 per 1.00 for the third and fourth fiscal quarters for our 2020 fiscal
year; (c) 3.75 to 1.00 for the first fiscal quarter for our 2021 fiscal year; and (d) 3.00 to 1.00 for each fiscal quarter thereafter.
The lenders’ obligations to extend credit under the Amended Credit Agreement, as amended by the Amendment, will depend upon
our compliance with these covenants.
Fees and expenses incurred
in connection with the Amendment were paid from cash on hand.
The Obligations
pursuant to the Amended Credit Agreement, as amended by the Amendment, can be accelerated upon an Event of Default, as such
terms are defined in the Amended Credit Agreement. The description of the Amended Credit Agreement, before execution of the
Amendment, is qualified in its entirety by the copy thereof which is attached as Exhibit 10.1 to our Current Report on Form
8-K dated August 7, 2017 and incorporated herein by reference. The description of the Amendment is qualified in its entirety by the copy thereof which is attached hereto as Exhibit 10.1
and incorporated herein by reference.
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Item 2.03
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Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
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Concurrently with the execution of the
Amendment and as a precautionary measure, we provided notice to the lenders under the Amendment of our desire to exercise our
right to borrow on the senior 364-day incremental revolving credit facility under the Amended Credit Agreement in the
aggregate principal amount of up to $50.0 million so that a total of $248.2 million will be outstanding (including $8.2
million of outstanding letters of credit) following receipt of such additional $50.0 million draw down. As of the date of
this Current Report on Form 8-K, we still remain in compliance with all financial covenants set forth in the
Amended Credit Agreement, as amended by the Amendment.
In light of the continued uncertainty in
the global markets resulting from the COVID-19 outbreak, we increased our borrowing as a precautionary measure in order to bolster
our cash position and further enhance financial flexibility. The proceeds from these borrowings are being held on our balance sheet
and may in the future be used for general corporate purposes, including, without limitation, working capital, capital expenditures
in the ordinary course of business, or other lawful corporate purposes, all in accordance with and subject to the terms and conditions
of the Amended Credit Agreement.
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Item 9.01
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Financial Statements and Exhibits
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Forward-looking Statements
This
Current Report on Form 8-K includes forward-looking statements within the meaning of Section 27A of the Securities Act and Section
21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited to, statements related to
the continued potential impact of the COVID-19 outbreak and other non-historical statements. Such statements are based upon
the current beliefs and expectations of the management of Texas Roadhouse. Actual results may vary materially from those contained
in forward-looking statements based on a number of factors including, without limitation, conditions beyond our control such as
weather, natural disasters, disease outbreaks, epidemics or pandemics impacting our customers or food supplies; food safety and
food-borne illness concerns; and other factors disclosed from time to time in our filings with the U.S. Securities and Exchange
Commission. 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 “Part I—Item 1A. Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31,
2019 and other subsequent filings on Form 10-Q and Form 8-K. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary
statements that are included in this Current Report on Form 8-K and in our other filings with the Securities and Exchange Commission.
Investors should take such risks into account when making investment decisions. Shareholders and other readers are cautioned
not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. We undertake
no obligation to update any forward-looking statements, except as required by applicable law.
INDEX TO EXHIBITS
SIGNATURE
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 thereunto duly authorized.
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TEXAS ROADHOUSE, INC.
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Date: May 11, 2020
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By:
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/s/ Tonya Robinson
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Tonya Robinson
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Chief Financial Officer
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