| ITEM 1.01 | ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT |
On March 15, 2024, NN, Inc., a Delaware corporation (the “Company”), closed its previously-announced sale leaseback transactions (the “Sale Leaseback Transactions”) with Tenet Equity Funding SPE III, LLC, a Delaware limited liability company (the “Buyer”), pursuant to which the Company sold certain facilitates owned by subsidiaries of the Company (the “Properties”) to the Buyer for an aggregate purchase of $16.8 million. The transactions closed in accordance with the Purchase and Sale and Escrow Agreement dated March 5, 2024, between the Company and the Buyer (the “Agreement”), which was previously disclosed in the Company’s Current Report on Form 8-K filed by the Company on March 8, 2024.
Under the Agreement, the Company also entered into a Master Lease with the Buyer (the “Master Lease”) under which the Company leases each of the Properties. The Master Lease became effective upon the closing of the Sale Leaseback Transactions and has an initial term of 20 years. The Company used the Net Cash Proceeds (as defined in the Term Loan Credit Agreement) generated from the Sale Leaseback Transactions to repay a portion of the outstanding borrowings under the Company’s credit facilities.
TLCA Amendment
In connection with the Sale Leaseback Transactions, on March 15, 2024, the Company, certain subsidiaries of the Company named therein, the lenders party thereto and Oaktree Fund Administration, LLC (“Oaktree”), as administrative agent, entered into that certain Amendment No. 3 to Term Loan Credit Agreement (the “TLCA Amendment”), which amended the Company’s existing Term Loan Credit Agreement, dated as of March 22, 2021 (as previously amended and as amended by the TLCA Amendment, the “Term Loan Credit Agreement”), by and among the Company, the lenders party thereto from time to time, and Oaktree, as administrative agent.
The TLCA Amendment, among other things, (i) requires the Company to use the net cash proceeds from the Sale Leaseback Transactions, or certain other dispositions prior to June 30, 2024, to prepay any outstanding indebtedness under the Term Loan Credit Agreement and (ii) amends certain definitions and other terms under the Term Loan Credit Agreement relating to the Sale Leaseback Transactions.
ABL Amendment
Additionally, in connection with the Sale Leaseback Transactions and the TLCA Amendment, on March 15, 2024, the Company, certain subsidiaries of the Company named therein, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent, entered into that certain Amendment No. 2 to Credit Agreement (the “ABL Amendment” and together with the TLCA Amendment, the “Loan Amendments”), which amended the Company’s existing Credit Agreement, dated as of March 22, 2021 (as previously amended and as amended by the ABL Amendment, the “ABL Credit Agreement”), by and among the Company, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent. The ABL Amendment amends certain definitions and other terms under the ABL Credit Agreement relating to the Sale Leaseback Transactions.
The foregoing summaries of the Agreement, TLCA Amendment and ABL Amendment are qualified in their entirety by reference to the full text of (i) the Agreement, a copy of which was filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed by the Company on March 8, 2024; (i) the TLCA Amendment, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K; and (iii) the ABL Amendment, a copy of which is filed as Exhibit 10.2 to this Current Report on Form 8-K, each of which 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 information set forth above in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
| ITEM 9.01 | FINANCIAL STATEMENTS AND EXHIBITS |
(d) Exhibits.
