less than 2.00:1.00; and 2.50% if the Consolidated Senior Net Leverage Ratio is less than 1.00:1.00. The Credit Agreement requires the Borrower to pay the Lenders an unused commitment fee equal to, initially, 0.35% per annum of the average unused portion of the Revolving Credit Facility and after the Agent receives copies of the consolidated financial statements of the Borrower for the fiscal quarter ending June 30, 2021: 0.40% per annum of the average unused portion of the Revolving Credit Facility if the Consolidated Senior Net Leverage Ratio is greater than or equal to 3.00:1.00; 0.35% per annum of the average unused portion of the Revolving Credit Facility if the Consolidated Senior Net Leverage Ratio is greater than or equal to 2.00:1.00 but less than 3.00:1.00; 0.30% per annum of the average unused portion of the Revolving Credit Facility if the Consolidated Senior Net Leverage Ratio is greater than or equal to 1.00:1.00 but less than 2.00:1.00; and 0.25% per annum of the average unused portion of the Revolving Credit Facility if the Consolidated Senior Net Leverage Ratio is less than 1.00:1.00. If all or a portion of the Loans under the Term Loan Facility are prepaid, then the Company will be required to pay a fee equal to 1% of the of the aggregate amount of the loans so prepaid, subject to certain exceptions.
The Credit Agreement contains restrictions and covenants applicable to the Company and its subsidiaries. Among other requirements, the Company may not permit the Fixed Charge Coverage Ratio (as defined in the Credit Agreement) to be less than a certain specified ratio for each fiscal quarter during the term of the Credit Agreement or the Consolidated Senior Net Leverage Ratio to be greater than a certain specified ratio for each fiscal quarter during the term of the Credit Agreement.
The Credit Agreement also contains customary covenants that limit, among other things, the ability of the Company and its subsidiaries to (i) incur indebtedness, (ii) incur liens on their property, (iii) pay dividends or make other distributions, (iv) sell their assets, (v) make certain loans or investments, (vi) merge or consolidate, (vii) voluntarily repay or prepay certain indebtedness and (viii) enter into transactions with affiliates, in each case subject to certain exceptions. The Credit Agreement contains customary representations and warranties and events of default.
The foregoing summary of the terms of the Credit Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Credit Agreement, a copy of which will be filed as an exhibit to the Company’s Annual Report on Form 10-K for the year ending June 30, 2021.
Amendment of Existing Credit Facilities
On May 6, 2021, the Company entered into (i) an amendment (the “Revolving Loan Amendment”) to the credit and security agreement, dated as of June 14, 2017 (as amended or otherwise modified, the “Existing Revolving Facility”), by and among the Company, TomoTherapy, MidCap Financial Trust and the other parties thereto and (ii) an amendment (the “Term Loan Amendment” and, together with the Revolving Loan Amendment, the “Amendments”) to the credit and security agreement, dated as of December 15, 2017 (as amended or otherwise modified, the “Existing Term Loan Facility” and, together with the Existing Revolving Facility, the “Existing Facilities”), by and among the Company TomoTherapy, MidCap Financial Trust and the other parties thereto. The Amendments amended the Existing Revolving Facility and Existing Term Loan Facility to, among other things and subject to certain conditions, permit the Company to enter into the Agreements and consummate the Transactions.
Item 1.02 Termination of Material Definitive Agreements
On May 13, 2021, the proceeds from the Credit Facility, plus available cash on hand, are expected to be used to repay all outstanding obligations and terminate all commitments under the Existing Facilities. The Existing Term Loan Facility and the Existing Revolving Facility are expected to be terminated on May 13, 2021. The material terms of the Existing Facilities have been previously reported on the Company’s Current Reports on Form 8-K filed with the Securities and Exchange Commission.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth in Item 1.01 above is incorporated by reference into this Item 2.03.
Item 3.02 Unregistered Sales of Equity Securities
The new notes are expected to be issued to the Exchange Participants and the Purchasers in a private placement in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act. The Company is
relying on this exemption from registration based in part on representations made by the Exchange Participants and the Purchasers in the Agreements. The information set forth in Item 1.01 above is incorporated by reference into this Item 3.02.
