- Current report filing (8-K)
February 23 2012 - 5:16PM
Edgar (US Regulatory)
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): February 21, 2012
The Hackett Group, Inc.
(Exact name of registrant as specified in its charter)
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Florida
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0-24343
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65-0750100
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(State or other jurisdiction of incorporation)
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(Commission File Number)
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(IRS Employer Identification Number)
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1001 Brickell Bay Drive, Suite 3000
Miami, Florida
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33131
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(Address of principal executive offices)
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(Zip Code)
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(305) 375-8005
(Registrants telephone number, including area code)
Not
applicable
(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):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 1.01. Entry
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into a Material Definitive Agreement.
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On February 21, 2012, The Hackett Group, Inc. (we, us, Hackett or the Company) entered into a Credit Agreement with Bank of America, N.A. Under the
terms of the Credit Agreement, Bank of America, N.A. has agreed to lend the Company up to $20
million from time to time pursuant to a revolving line of credit (the Revolver) and up to $30 million pursuant to a term loan (the
Term Loan and together with the Revolver, the Credit Facility).
The proceeds of the Term Loan will be
used, along with up to $20 million of cash and cash equivalents balances on hand, for the purchase of up to $55 million in value of shares of the Companys common stock (the Shares) in the Companys previously announced
Dutch auction tender offer (the Offer), and the payment of all fees and expenses in connection with the Offer. Borrowing under the Term Loan is subject to and contingent upon the successful completion of the Offer as well as
the satisfaction of the other customary conditions precedent under the Credit Agreement. In the event that the full $30 million is not borrowed under the Term Loan for the purchase of Shares in the Offer, up to $10 million will remain available for
borrowing under the Term Loan to fund future purchases of Shares by the Company.
The obligations of Hackett under the Credit
Facility are guaranteed by certain existing and future material U.S. subsidiaries of Hackett (the U.S. Subsidiaries), and are secured by substantially all of the existing and future property and assets of Hackett and the U.S.
Subsidiaries, a 100% pledge of the capital stock of the U.S. Subsidiaries, and a 66% pledge of the capital stock of Hacketts direct foreign subsidiaries (subject to certain exceptions).
The interest rates per annum applicable to loans under the Credit Facility will be, at Hacketts option, equal to either a base rate
or a LIBOR rate for one-, two-, three- or six-month interest periods chosen by Hackett, in each case, plus an applicable margin percentage. The applicable margin percentage is determined from time to time under the Credit Agreement based on a
consolidated leverage ratio. The initial applicable margin percentage is 2.0% per annum, in the case of LIBOR rate advances, and 1.25% per annum, in the case of base rate advances.
The Credit Facility matures on February 21, 2017. In addition, subject to certain thresholds and exceptions, Hackett will be
required to prepay the loans outstanding under the Credit Facility with (i) net cash proceeds from non-ordinary course sales of property and assets of Hackett or its subsidiaries and (ii) net cash proceeds from the issuance or incurrence
of additional debt or equity securities of Hackett or its subsidiaries (other than issuances in connection with the Companys equity compensation plans or acquisitions).
The Credit Agreement contains customary representations, warranties, indemnities and affirmative and negative covenants. The negative covenants include, among others, certain limitations on the ability
to: incur liens and indebtedness; consummate mergers, consolidations or asset sales; make guarantees and investments; and pay dividends or distributions on or make certain distributions in respect of Shares. In addition, the Credit Agreement
contains financial covenants that require Hackett to maintain on a consolidated basis a minimum fixed charge coverage ratio of greater than or equal to 1.5 to 1.0 and a consolidated leverage ratio of less than or equal to 2.5 to 1.0, in each case as
calculated in accordance with the Credit Agreement.
The Credit Agreement also includes certain customary events of default,
including, among others, the failure to make payments when due, insolvency, certain judgments, breaches of representations and warranties, breaches of covenants and the occurrence of certain events, including cross acceleration to other indebtedness
of Hackett and its subsidiaries.
The Credit Agreement is filed as an Exhibit to this Form 8-K, and this summary is qualified
in its entirety by reference to the Credit Agreement.
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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The disclosure contained in Item 1.01 is incorporated herein by reference.
Item 9.01.
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Financial Statements and Exhibits.
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(d) Exhibits
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Exhibit
Number
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Description
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10.1
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Credit Agreement, dated as of February 21, 2012, among The Hackett Group, Inc., the material domestic subsidiaries of Hackett named on the signatures pages thereto and Bank of
America, N.A., as lender.
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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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The Hackett Group, Inc.
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Date: February 23, 2012
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By:
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/s/ Robert A. Ramirez
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Robert A. Ramirez
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Executive Vice President, Finance and Chief Financial Officer
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EXHIBIT LIST
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Exhibit
Number
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Description
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10.1
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Credit Agreement, dated as of February 21, 2012, among The Hackett Group, Inc., the material domestic subsidiaries of Hackett named on the signatures pages thereto and Bank of
America, N.A., as lender.
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