UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) February 22, 2023
Information Services Group, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | | 001-33287 | | 20-5261587 |
| (State or other jurisdiction of | | (Commission File Number) | | (I.R.S. Employer |
| incorporation) | | | | Identification No.) |
2187 Atlantic Street
Stamford, CT 06902
(Address of principal executive offices)
(203) 517-3100
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933(§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | | Trading Symbol(s) | | Name of each exchange on which registered |
| Shares of Common Stock, $0.001 par value | | III | | The Nasdaq Stock Market LLC |
ITEM 1.01 Entry into a Material Definitive Agreement.
On February 22, 2023, Information Services Group, Inc. (“ISG” or the “Company”) entered into a third amended and restated senior secured credit facility comprising a $140,000,000 revolving credit facility (the “Amended and Restated Credit Agreement”), amending and restating the second amended and restated senior secured credit facility entered into on March 10, 2020 (the “Existing Credit Agreement”). The material terms of the Amended and Restated Credit Agreement are as follows:
| • | On the closing date of the Amended and Restated Credit Agreement, the Company repaid in full the aggregate outstanding principal amount of the term loan and revolving loan outstanding under the Existing Credit Agreement, and no further term loans or term loan commitments exist. |
| • | The revolving credit facility has a maturity date of February 22, 2028 (the “Maturity Date”). |
| • | The credit facility is secured by all of the equity interests owned by the Company, and its direct and indirect domestic subsidiaries and, subject to agreed exceptions, the Company’s direct and indirect “first-tier” foreign subsidiaries and a perfected first priority security interest in all of the Company’s and its direct and indirect domestic subsidiaries’ tangible and intangible assets. |
| • | The Company’s direct and indirect existing and future wholly-owned domestic subsidiaries serve as guarantors to the Company’s obligations under the senior secured facility. |
| • | At the Company’s option, the credit facility bears interest at a rate per annum equal to either (i) the “Base Rate” (which is the highest of (a) the rate publicly announced from time to time by the administrative agent as its “prime rate”, (b) the Federal Funds Rate plus 0.5% per annum and (c) Term SOFR, plus 1.0%), plus the applicable margin (as defined below) or (ii) Term SOFR (which is the Term SOFR screen rate for the relevant interest period plus a credit spread adjustment of 0.10%) as determined by the Administrative Agent, plus the applicable margin. The applicable margin is adjusted quarterly based upon the Company’s consolidated leverage ratio. Prior to the end of the first quarter-end following the closing of the credit facility, the applicable margin shall be a percentage per annum equal to 0.50 % for the revolving loans maintained as Base Rate loans or 1.50% for the revolving loans maintained as Term SOFR loans. |
| • | The revolving credit facility includes a sublimit of $10,000,000 for letters of credit. |
| • | The senior secured credit facility contains a number of covenants that, among other things, place restrictions on matters customarily restricted in senior secured credit facilities, including restrictions on indebtedness (including guarantee obligations), liens, fundamental changes, sales or disposition of property or assets, investments (including loans, advances, guarantees and acquisitions), transaction with affiliates, dividends and other payments in respect of capital stock, optional payments and modifications of other material debt instruments, negative pledges and agreements restricting subsidiary distributions and changes in line of business. In addition, the Company is required to comply with a consolidated leverage ratio and consolidated interest coverage ratio. |
| • | The senior secured credit facility contains customary events of default, including cross-default to other material agreements, judgment default and change of control. |
The above description of the Amended and Restated Credit Agreement does not purport to be a complete statement of the provisions thereof. Such description is qualified in its entirety by reference to the Amended and Restated Credit Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K.
ITEM 2.03. CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT
The information provided in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference into this Section 2.03.
ITEM 8.01 OTHER EVENTS
On February 23, 2023, the Company issued a press release announcing the execution of the Amended and Restated Credit Agreement. A copy of the press release is attached hereto as Exhibit 99.1.
The information provided pursuant to this Item 8.01, including Exhibit 99.1 in Item 9.01, is “furnished” and shall not be deemed to be “filed” with the Securities and Exchange Commission or incorporated by reference in any filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in any such filings.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
(d) Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Dated: February 23, 2023 | INFORMATION SERVICES GROUP, INC. |
| | |
| | By: | /s/ Michael P. Connors |
| | | Michael P. Connors |
| | | Chairman and Chief Executive Officer |
