Item 1.01. Entry into a Material Definitive Agreement.
On December 10, 2019,
LendingTree, LLC, a wholly-owned subsidiary of LendingTree, Inc. (the “Company”), entered into an amended and restated
$500.0 million five-year senior secured revolving credit facility which matures on December 10, 2024 (the “Second Amended
and Restated Revolving Credit Facility”). The proceeds of the Second Amended and Restated Revolving Credit Facility can be
used to finance working capital needs, capital expenditures and general corporate purposes, including to finance permitted acquisitions.
As of December 10, 2019, the Company has borrowings of $75.0 million outstanding under the Second Amended and Restated Revolving
Credit Facility.
Up to $10.0 million
of the Second Amended and Restated Revolving Credit Facility will be available for short-term loans, referred to as swingline loans.
Additionally, up to $10.0 million of the Second Amended and Restated Revolving Credit Facility will be available for the issuance
of letters of credit. Under certain conditions, the Company will be permitted to add one or more term loans and/or increase revolving
commitments under the Second Amended and Restated Revolving Credit Facility by an additional $185.0 million, or a greater amount
provided that a total consolidated senior secured debt to EBITDA ratio does not exceed 2.50 to 1.00.
The Company’s
borrowings under the Second Amended and Restated Revolving Credit Facility bear interest at annual rates that, at the Company’s
option, will be either:
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a base rate generally defined as the sum
of (i) the greater of (a) the prime rate of SunTrust Bank, (b) the federal funds effective rate plus 0.5% and (c) the LIBO rate
(defined below) on a daily basis applicable for an interest period of one month plus 1.0% and (ii) an applicable percentage of
0.25% to 1.00% based on a total consolidated debt to EBITDA ratio; or
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a LIBO rate generally defined as the sum
of (i) the rate for Eurodollar deposits in the applicable currency and (ii) an applicable percentage of 1.25% to 2.00% based on
a total consolidated debt to EBITDA ratio.
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All swingline loans
bear interest at the base rate defined above. Interest on the Company’s borrowings are payable quarterly in arrears for base
rate loans and on the last day of each interest rate period (but not less often than three months) for LIBO rate loans.
The Second Amended
and Restated Revolving Credit Facility contains a restrictive financial covenant, which initially limits the total consolidated
debt to EBITDA ratio to 4.50:1.00, with step downs to 4.00:1.00 over time, except that this may increase by 0.50:1.00 for the four
fiscal quarters following a material acquisition. In addition, the Second Amended and Restated Revolving Credit Facility contains
customary affirmative and negative covenants in addition to events of default for a transaction of this type that, among other
things, restrict additional indebtedness, liens, mergers or certain fundamental changes, asset dispositions, dividends and other
restricted payments, transactions with affiliates, sale-leaseback transactions, hedging transactions, loans and investments and
other matters customarily restricted in such agreements.
The Second Amended
and Restated Revolving Credit Facility requires LendingTree, LLC to pledge as collateral, subject to certain customary exclusions,
substantially all of its assets, including 100% of its equity in all of its domestic subsidiaries and 66% of the voting equity,
and 100% of the non-voting equity, in all of its material foreign subsidiaries (of which there are currently none). The obligations
under this facility are unconditionally guaranteed on a senior basis by the Company and material domestic subsidiaries of LendingTree,
LLC, which guaranties are secured by a pledge as collateral, subject to certain customary exclusions, of 100% of each such guarantor’s
assets, including 100% of each such guarantor’s equity in all of its domestic subsidiaries and 66% of the voting equity,
and 100% of the non-voting equity, in all of its material foreign subsidiaries.
The Company is required
to pay an unused commitment fee quarterly in arrears on the difference between committed amounts and amounts actually borrowed
under the Second Amended and Restated Revolving Credit Facility equal to an applicable percentage of 0.25% to 0.45% per annum based
on a total consolidated debt to EBITDA ratio. The Company is required to pay a letter of credit participation fee and a letter
of credit fronting fee quarterly in arrears. The letter of credit participation fee is based upon the aggregate face amount of
outstanding letters of credit at an applicable percentage of 1.25% to 2.00% based on a total consolidated debt to EBITDA ratio.
The letter of credit fronting fee is 0.125% per annum on the face amount of each letter of credit.
The summary above
is qualified in its entirety by the terms of the Second Amended and Restated Credit Agreement, which is filed herewith as Exhibit
99.1.