Delaware
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13-3873847
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(State or other jurisdiction of
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(IRS Employer
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incorporation)
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Identification No.)
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Information to be included in the report
The Credit Agreement provides for a $500 million revolving credit facility that matures in six years, with the option to increase the size of the facility by up to an additional $200 million, subject to the satisfaction of certain terms and conditions. As of June 29, 2007 (the closing of the transaction), there was approximately $328 million outstanding under the facility. Borrowings under the revolving credit facility may be repaid at any time, but no later than June 29, 2013. The Company retains the right to terminate or reduce the size of the facility at any time.
Interest on revolving credit loans will accrue, at the Company's election, at (i) the Eurocurrency rate (as defined in the Credit Agreement), plus additional percentage points based on the Company's leverage ratio or (ii) the Base Rate (a rate based on the prime rate announced from time-to-time by Bank of America, N.A., or the Federal Reserve System's federal funds rate; Base Rate is defined in detail in the Credit Agreement), plus additional percentage points based on the Company's leverage ratio.
The Credit Agreement requires the Company to comply with various affirmative and negative covenants, including without limitation (i) covenants to maintain a minimum specified interest coverage ratio and maximum specified leverage ratio, and (ii) covenants that prevent or restrict the Company's ability to pay dividends, engage in certain mergers or acquisitions, make certain investments or loans, incur future indebtedness, make significant capital expenditures, engage in sale-leaseback transactions, alter its capital structure or line of business, prepay subordinated indebtedness, engage in certain transactions with affiliates and sell stock or assets.
Repayments under the Credit Agreement can be accelerated by the lenders upon the occurrence of certain events of default, including, without limitation, a failure to pay any principal, interest or other amounts in respect of loans when due, breach by the Company (or its subsidiaries) of any of the covenants or representations contained in the Credit Agreement or related loan documents, failure of the Company (or its material subsidiaries) to pay any amounts owed with respect to other significant indebtedness of the Company or such subsidiary, or a bankruptcy event with respect to the Company or any of its material subsidiaries.
The indebtedness incurred under the Credit Agreement is secured by substantially all of the Company's tangible and intangible assets, including, without limitation, the Company's intellectual property. The Company's wholly-owned subsidiaries, Knoll Overseas, Inc. and Spinneybeck Enterprises, Inc., have also guaranteed the Company's obligations under the Credit Agreement and pledged substantially all of their tangible and intangible assets as security for their obligations under such guarantee. As additional security for the indebtedness incurred under the Credit Agreement, the Company, Knoll Overseas, Inc. and Spinneybeck Enterprises, Inc. have pledged the equity of their U.S. subsidiaries and a portion of the equity of certain of their first-tier international subsidiaries.
In connection with the Credit Agreement, the Company announced that it will write off in the second quarter of 2007 approximately $1.2 million of costs associated with the prior facility, which was paid off and terminated in connection with the closing of the new facility.
The above summary of the Credit Agreement is qualified in its entirety by reference to the full text of the Credit Agreement, a copy of which is attached to this Current Report on Form 8-K as Exhibit 10.1, and incorporated by reference herein.
10.1 Credit Agreement, dated as of June 29, 2007, among Knoll, Inc., the domestic subsidiaries of Knoll, Inc., Bank of America, N.A., Banc of America Securities LLC, HSBC Bank USA, National Association, Citizens Bank and the other lenders party thereto.
99.1 Press Release, dated June 29, 2007.
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Knoll, Inc.
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Date: June 29, 2007
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By:
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/s/ Barry L. McCabe
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Barry L. McCabe
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Senior Vice President and Chief Financial Officer
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Exhibit No.
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Description
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EX-99.1
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Press Release, dated June 29, 2007.
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EX-10.1
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Credit Agreement, dated as of June 29, 2007, among Knoll, Inc., the domestic subsidiaries of Knoll, Inc., Bank of America, N.A., Banc of America Securities LLC, HSBC Bank USA, National Association, Citizens Bank and the other lenders party thereto.
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