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Item 1.01 | Entry into a Material Definitive Agreement. |
The information set forth in Item 2.03 below is incorporated by reference into this Item 1.01.
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Item 2.03. | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement |
On April 21, 2022, INDUS Realty Trust, Inc. (the “Company”), as parent guarantor, INDUS RT, LP (the “Operating Partnership”), as borrower, certain subsidiaries of INDUS RT, LP as guarantors, together with JPMorgan Chase Bank, N.A. (“JPMorgan”) as Administrative Agent, Joint Lead Arranger and Joint Bookrunner, CITIBANK, N.A. as Joint Lead Arranger, Joint Bookrunner and Syndication Agent and the other parties thereto entered into an Amended and Restated Credit Agreement (the “Credit Agreement”) for a $250 million secured credit facility (the “New Credit Facility”), amending and restating the $100 million credit facility executed on August 5, 2021 (the “Existing Credit Facility”).
The Credit Agreement was amended and restated to provide for, among other things: (1) the addition of a delayed draw term loan facility (the “DDTL Facility”) in an amount up to $150 million, pursuant to which up to three separate draws may be made prior to April 21, 2023 (the first two of which must each be in a minimum amount of $25 million), and (2) the transition from London Interbank Offered Rate (“LIBOR”) to the Secured Overnight Financing Rate (“SOFR”) for floating rate borrowings for all purposes under the Credit Agreement. The DDTL Facility will mature on April 21, 2027. The New Credit Facility continues to include a $100 million revolving credit facility (the “Revolving Credit Facility”), however, the maturity of the Revolving Credit Facility has been extended to April 21, 2025, with options to extend consistent with the Existing Credit Facility. The New Credit Facility also increases the uncommitted incremental facility, which, as amended, would enable the Company to increase the New Credit Facility by up to $250 million in the aggregate.
Borrowings under the New Credit Facility will continue to bear interest subject to a pricing grid based on the Company’s total leverage. Based on the Company’s current leverage, the initial annual interest rates under the New Credit Facility would be (i) SOFR plus 1.20% for revolving borrowings (the same applicable margin as under the Existing Credit Facility), and (ii) SOFR plus 1.15% for term borrowings (compared with LIBOR plus 1.20% under the Existing Credit Facility).
The financial covenants under the New Credit Facility are consistent with those under the Existing Credit Facility, except that the Company must now maintain a minimum borrowing base of: (a) $75 million through December 30, 2022 (compared with $30 million under the Existing Credit Facility), (b) $125 million from December 31, 2022 through December 30, 2023 (compared with $50 million under the Existing Credit Facility), and (c) $250 million on and after December 31, 2023 (compared with $100 million under the Existing Credit Facility).
The foregoing description of the Credit Agreement is subject to and qualified in its entirety by reference to the full text of the Credit Agreement, a copy of which is filed herewith as Exhibit 10.1 and is incorporated herein by reference.
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Item 7.01. | Regulation FD Disclosure |
A copy of the Company’s April 25, 2022 press release announcing the New Credit Facility is attached hereto as Exhibit 99.1.
