| Item 1.01. | Entry into a Material Definitive Agreement. |
Amendment to Credit Agreement
On May 23, 2022, , Bowman Consulting Group Ltd. (the “Company”) entered into a Seventh Amendment to Credit Agreement (the “Amendment”) with Bank of America, N.A. (the “Bank”) which amended the Credit Agreement with the Bank dated as of August 24, 2017, as amended from time to time (the “Credit Agreement”).
The Amendment extends the term of the revolving line of credit for one year, until July 31, 2024, and increases the maximum principal amount of the revolving line of credit to $25 million. The maximum advance is equal to the lesser of $25 million or the Borrowing Base as defined in the Credit Agreement.
The Amendment also modifies the definition of Permitted Acquisitions which are acquisitions that do not require the prior consent of the Bank. Under the Amendment no prior consent would be required so long as (i) no event of default has occurred or would occur as a result of the acquisition, (ii) the Company would be in compliance with the financial covenants in the Credit Facility on a pro forma basis, (iii) the total consideration (which excludes the value of equity that may be issued as part of the purchase price) for any single acquisition does not exceed $7.5 million and total consideration in any twelve month period, calculated from and after May 15, 2022, does not exceed $40 million, and (iv) at the time and after giving effect to each such acquisition, the sum of the Company’s unencumbered cash and availability is not less than $10 million.
The Amendment requires monthly payments of interest on the Revolving Line at the daily Secured Overnight Financing Rate (SOFR) as published on such date by the Federal Reserve Bank of New York, plus an applicable rate which varies between 2.00% and 2.60% based on the Company ratio of Funded Debt to EBITDA (as each is defined in the Credit Agreement), as set forth in the Amendment.
The foregoing summary of the Amendment is qualified in its entirety by reference to the full text of the Amendment, a copy of which is attached as Exhibit1.1 to this Current Report on Form 8-K and is incorporated herein by reference.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The discussion of the Seventh Amendment set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference in this Item 2.03.
Two executive officers of the Company, one of whom is also a director, have entered into written stock trading plans pursuant to Rule 10b5-1 of the Securities Exchange Act of 1934, as amended (each a “10b5-1 Plan”) and the Company’s insider trading policy.
On May 19, 2022, Michael Bruen, the Company’s Chief Operating Officer and Director, entered into a 10b5-1 Plan relating to the sales of up to 30,000 shares of Company common stock. Subject to the terms and conditions of the plan, a brokerage firm may periodically effect the transactions from December 2022 through November 2023. As previously disclosed, Mr. Bruen entered into a 10b5-1 Plan on November 22, 2021 that relates to the sales of up to 10,000 shares of Company common stock. That plan remains in effect from March 2022 through November 2022.
On May 23, 2022, Bruce Labovitz, the Company’s Chief Financial Officer, entered into a 10b5-1 Plan related to the sales of up to 7,000 shares of Company common stock. Subject to the terms and conditions of this plan, a brokerage firm may periodically effect the transactions from October 2022 through December 2022.
Transactions under the 10b5-1 Plans will be reported to the Securities and Exchange Commission in accordance with applicable securities laws, rules, and regulations, to the extent applicable.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
