GTY TECHNOLOGY HOLDINGS INC. (NASDAQ:GTYH) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01
On February 14, 2020, GTY Technology Holdings Inc., a Massachusetts corporation (“GTY” or the “Company”) entered into a Credit Agreement by and among the Company, certain of its subsidiaries as guarantors, the lenders from time to time party thereto and Wilmington Trust, National Association, as Administrative Agent, with Nineteen77 Global Multi-Strategy Alpha Master Limited (“Nineteen77”), an affiliate of UBS O\’Connor LLC, as Sole Lead Arranger and Sole Bookrunner (the “Credit Agreement” and the facility thereunder, the “Credit Facility”).
The Credit Facility is an unsecured term loan facility that provides for borrowing of term loans in an aggregate principal amount of $12,000,000. The Credit Facility has a maturity date of twelve (12) months from the borrowing of the term loans. On the closing date, the Company fully drew on the Credit Facility and the current outstanding balance is $12,000,000.
Amounts outstanding, if any, under the Credit Facility bear interest from the date the term loans are first made until the last day of the fiscal month immediately following the six (6) month anniversary of such initial borrowing date (the “Initial Interest Period End Date”), at a rate per annum equal to twelve percent (12%). Commencing on the first day of the fiscal month immediately following the Initial Interest Period End Date and on the first day of each fiscal month thereafter, the interest rate shall be increased by one percent (1%) per annum until the term loans have been paid in full in cash and all commitments under the Credit Agreement have terminated.
The Credit Agreement does not contain any leverage or fixed charge coverage ratio financial covenants.
The Credit Agreement contains various customary covenants that limit or prohibit the Company’s ability to, among other things: (i) incur or guarantee additional indebtedness; (ii) pay certain dividends on its capital stock or redeem, repurchase, retire or make distributions in respect of its capital stock or subordinated indebtedness or make certain other restricted payments; (iii) make certain loans, acquisitions, capital expenditures or investments; (iv) sell certain assets, including stock of its subsidiaries; (v) enter into certain sale and leaseback transactions; (vi) create or incur certain liens; (vii) consolidate, merge, sell, transfer or otherwise dispose of all or substantially all of its assets; (viii) enter into certain transactions with its affiliates; and (ix) engage in certain business activities.
A violation of the covenants under the Credit Agreement may result in default or an event of default under the Credit Facility. Upon the occurrence of an event of default under the Credit Agreement, the requisite lenders could elect to declare all amounts of such indebtedness outstanding to be immediately due and payable and terminate any commitments to extend further credit.
The Credit Agreement is not supported by a security interest in the assets of the Company, but is supported by the guarantors party to the Credit Agreement and to a related guaranty agreement.
During the term of the Credit Agreement and subject to certain exceptions, the Company also granted Nineteen77 (or its affiliates) a right of first refusal if the Company elects to raise capital by way of an issuance of capital stock of the Company at a discount to the then current market trading price of Company’s common stock.
The foregoing descriptions of the Credit Agreement do not purport to be complete and are qualified in their entireties by the terms of the Credit Agreement, a copy of which is attached hereto as Exhibit 10.1 and are incorporated herein by reference.
| 10.1 | Credit Agreement, dated as of February 14, 2020, by and among GTY Technology Holdings, Inc., its wholly-owned subsidiaries as guarantors, the lenders from time to time thereto and Wilmington Trust, National Association, as Administrative Agent, and Nineteen77 Global Multi-Strategy Alpha Master Limited, as sole lead arranger and sole bookrunner. |
GTY Technology Holdings Inc. Exhibit
EX-10.1 2 tm208120d1_ex10-1.htm EXHIBIT 10.1 Exhibit 10.1 CREDIT AGREEMENT dated as of February 14,…
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About GTY TECHNOLOGY HOLDINGS INC. (NASDAQ:GTYH)
GTY Technology Holdings Inc. is a blank check company. The Company was formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. The Company will seek to capitalize on the significant experience and contacts of its management team in consummating an initial business combination. The Company intends to identify, acquire and operate a business in the technology industry, including software and services that may provide the opportunity to unlock the value of a private company and provide opportunities for an attractive risk adjusted return to its shareholders. The Company is a Cayman Islands exempted company. As of October 26, 2016, the Company had conducted no operations. As of October 26, 2016, the Company had not generated any revenues.
