ENCORE CAPITAL GROUP, INC. (NASDAQ:ECPG) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01. Entry into a Material Definitive Agreement.
entered into a Third Amended and Restated Credit Agreement (the
Restated Credit Agreement) by and among the Company, the several
banks and other financial institutions and lenders from time to
time party thereto and listed on the pages thereof, and SunTrust
Bank, as administrative agent and collateral agent. The Restated
Credit Agreement amended and restated in its entirety the prior
credit agreement, dated as of February 25, 2014 (as amended,
supplemented or otherwise modified prior to the date hereof, the
Existing Credit Agreement) and provides for (1) an increase in
the revolving credit facility from $742.6 million to $781.7
million (the Revolving Credit Facility) and (2) an increase in
the term loan facility from $158.8 million (with $134.0 million
outstanding as of September 30, 2016) to $166.4 million (the Term
Loan Facility, and together with the Revolving Credit Facility,
the Senior Secured Credit Facilities). The Restated Credit
Agreement still provides for an accordion feature that allows the
Company to increase the Senior Secured Credit Facilities by an
additional $250.0 million. Including the accordion feature, the
maximum amount that can be borrowed under the Restated Credit
Agreement is approximately $1.2 billion. The Senior Secured
Credit Facilities have a five year maturity, expiring in December
2021, except with respect to (1) revolving commitments under the
Revolving Credit Facility of $32.1 million and $207.8 million,
expiring in November 2017 and February 2019, respectively and (2)
three sub-tranches of the Term Loan Facility of $50.6 million,
$4.9 million and $22.6 million, expiring in February 2017,
November 2017 and February 2019, respectively. The terms of the
Restated Credit Agreement are substantially similar to the terms
of the Existing Credit Agreement, except that the Restated Credit
Agreement, among other things:
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provides for a borrowing base equal to a fixed rate of 35%
of all eligible non-bankruptcy estimated remaining collections (previously a variable rate of 30%-35% depending on the trailing 12-month cost per dollar collected) plus 55% of eligible estimated remaining collections for consumer receivables subject to bankruptcy; |
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increases the maximum cash flow leverage ratio permitted
from 2.50:1.00 to 3.00:1.00; |
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provides for the allowance of indebtedness in the form of
senior secured notes not to exceed $150.0 million; |
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provides for the allowance of additional unsecured or
subordinated indebtedness not to exceed $1.1 billion, including junior lien indebtedness not to exceed $400.0 million; |
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provides for a basket to allow for investments in persons
organized under the laws of Canada in the amount of $50.0 million; and |
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requires the Company for the four-month period ending
February 2019 to have sufficient cash or availability under the Revolving Credit Facility (excluding availability under revolving commitments expiring in February 2019) to satisfy any amounts due under the revolving commitments that expire in February 2019 and the sub-tranche of the Term Loan Facility that expires in February 2019. |
Restated Senior Secured Note Purchase Agreement dated as of May
9, 2013 (as amended, the Note Purchase Agreement) by and among
the Company, on the one hand, and The Prudential Insurance
Company of America, Pruco Life Insurance Company, Prudential
Retirement Insurance and Annuity Company and Prudential Annuities
Life Assurance Corporation, on the other hand, for purposes of
aligning the covenants in the Note Purchase Agreement with the
modified covenants in the Restated Credit Agreement.
Agreement and the Note Purchase Agreement do not purport to be
complete and are qualified in their entirety by reference to the
complete text of the documents, copies of which are filed as
Exhibits 10.1 and 10.2, respectively, to this report and
incorporated herein by reference.
Obligation under an Off-Balance Sheet Arrangement of a
Registrant.
on Form 8-K is incorporated by reference.
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Exhibit Number
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Description
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10.1
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Third Amended and Restated Credit Agreement, dated
December 20, 2016, by and among Encore Capital Group, Inc., the several banks and other financial institutions and lenders from time to time party thereto and listed on the pages thereof, and SunTrust Bank, as administrative agent and collateral agent (filed herewith) |
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10.2
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Amendment No. 6, dated December 20, 2016, to Second
Amended and Restated Senior Secured Note Purchase Agreement, dated May 9, 2013, by and between Encore Capital Group, Inc., The Prudential Insurance Company of America, Pruco Life Insurance Company, Prudential Retirement Insurance and Annuity Company and Prudential Annuities Life Assurance Corporation (filed herewith) |
About ENCORE CAPITAL GROUP, INC.>>>>>>>>> (NASDAQ:ECPG)
Encore Capital Group, Inc., through its subsidiaries, is a specialty finance company providing debt recovery solutions for consumers and property owners across a range of financial assets. The Company operates through two segments: Portfolio Purchasing and Recovery, and Tax Lien Business. Its portfolio purchasing and recovery segment purchases portfolios of defaulted consumer receivables at discounts and manages them by partnering with individuals as they repay their obligations and work toward financial recovery. Defaulted receivables are consumers’ unpaid financial commitments to credit originators, including banks, credit unions, consumer finance companies, commercial retailers, and telecommunication companies. Defaulted receivables also include receivables subject to bankruptcy proceedings. In addition, the Company assists property owners delinquenting on their property taxes by structuring monthly payment plans and purchases delinquent tax liens directly from taxing authorities. ENCORE CAPITAL GROUP, INC.>>>>>>>>> (NASDAQ:ECPG) Recent Trading Information
ENCORE CAPITAL GROUP, INC.>>>>>>>>> (NASDAQ:ECPG) closed its last trading session up +0.05 at 28.40 with 214,742 shares trading hands.
