Item 1.01. Entry into a Material Definitive Agreement
On December 17, 2019, YETI Holdings, Inc. (the Company), certain subsidiaries of the Company, the lenders party thereto and Bank of America, N.A., in its capacity as administrative agent (the Administrative Agent), entered into the Second Amendment to Credit Agreement and Amendment to Collateral Agreement (the Credit Agreement Amendment), which amends that certain Credit Agreement by and among the Company, the lenders party thereto and the Administrative Agent, dated as of May 19, 2016 (as amended by that certain First Amendment to Credit Agreement, dated as of July 15, 2017 (the Existing Credit Agreement) and as further amended by the Credit Agreement Amendment, the Credit Agreement).
The Credit Agreement Amendment amended the Existing Credit Agreement to, among other matters:
· increase the principal amount of Term Loan A from approximately $298 million to $300 million;
· increase the commitments under the revolving credit facility from $100 million to $150 million;
· extend the maturity date of both Term Loan A and the revolving credit facility from May 19, 2021 to December 17, 2024;
· revise the leverage ratios and reduce the interest rates spreads and commitment fee payable on the average daily unused amount of the revolving commitment, as follows:
Existing Credit Agreement
|
|
Amended Credit Agreement
|
|
Total Net
Leverage Ratio:
|
|
LIBOR Spread
|
|
Commitment Fee
Rate
|
|
Total Net
Leverage Ratio:
|
|
LIBOR Spread
|
|
Commitment Fee
Rate
|
|
|
|
|
|
|
|
Category 1:
> 2.50 to 1.00
|
|
2.75
|
%
|
0.375
|
%
|
Category 1:
> 2.00 to 1.00
|
|
4.00
|
%
|
0.400
|
%
|
Category 2:
< 2.50 to 1.00 but
> 1.75 to 1.00
|
|
2.50
|
%
|
0.300
|
%
|
Category 2:
< 2.00 to 1.00 but
> 1.25 to 1.00
|
|
3.75
|
%
|
0.325
|
%
|
Category 3:
< 1.75 to 1.00 but
> 1.25 to 1.00
|
|
2.25
|
%
|
0.250
|
%
|
Category 3:
< 1.25 to 1.00
|
|
3.50
|
%
|
0.250
|
%
|
Category 4:
< 1.25 to 1.00 but
> 0.75 to 1.00
|
|
2.00
|
%
|
0.200
|
%
|
|
|
|
|
|
|
Category 5:
< 0.75 to 1.00
|
|
1.75
|
%
|
0.175
|
%
|
· revise the scheduled quarterly principal payments of Term Loan A to 1.25% of the remaining aggregate principal amount of Term Loan A for the first year, and 1.875% for the second year and thereafter until the maturity date. The scheduled quarterly principal payments shall begin on March 31, 2020 and shall be due each June 30, September 30, December 31, and March 31 thereafter until the maturity date. Previously, the quarterly principal payments were 2.5% of the original aggregate principal amount of Term Loan A until the maturity date.
Certain of the lenders, as well as certain of their respective affiliates, have performed and may in the future perform for the Company and its subsidiaries various commercial banking, investment banking, lending, underwriting, trust services, financial advisory and other financial services, for which they have received and may in the future receive customary fees and expenses.
The above disclosure contained in this Item 1.01 does not purport to be a complete description of the Credit Agreement Amendment and is qualified in its entirety by reference to the Credit Agreement Amendment, which is filed as Exhibit 10.1 hereto and is incorporated herein by reference.