Kforce Inc. (NASDAQ:KFRC) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.
The information set forth in Item 2.03 is incorporated by
reference into this Item 1.01.
reference into this Item 1.01.
Item 1.02. Termination of a Material Definitive Agreement.
On May 25, 2017, in connection with entering into a new credit
agreement (as more fully described in Item 2.03 of this Current
Report on Form 8-K), Kforce Inc. and its subsidiaries
(collectively, the Firm) terminated the Third Amended and
Restated Credit Agreement dated as of September 20, 2011, between
the Firm and a syndicate led by Bank of America, N.A. and also
including Wells Fargo, JPMorgan Chase and BMO Harris Bank (as
subsequently amended, the Prior Credit Facility), which was filed
as Exhibit 10.1 to the Companys Current Report on Form 8-K filed
September 23, 2011 and amended by filings on Form 10-Q filed May
7, 2012, on Form 10-K filed February 27, 2014 and on Form 8-K
filed December 23, 2014. Upon execution of the credit agreement
described below, the lenders commitments under the Prior Credit
Facility were terminated and the outstanding liabilities of the
Firm with respect to its obligations under the Prior Credit
Facility were released and discharged. Most of the agents and
lenders under the Prior Credit Facility hold positions as agents
and/or lenders under the Firms new credit agreement described
below.
agreement (as more fully described in Item 2.03 of this Current
Report on Form 8-K), Kforce Inc. and its subsidiaries
(collectively, the Firm) terminated the Third Amended and
Restated Credit Agreement dated as of September 20, 2011, between
the Firm and a syndicate led by Bank of America, N.A. and also
including Wells Fargo, JPMorgan Chase and BMO Harris Bank (as
subsequently amended, the Prior Credit Facility), which was filed
as Exhibit 10.1 to the Companys Current Report on Form 8-K filed
September 23, 2011 and amended by filings on Form 10-Q filed May
7, 2012, on Form 10-K filed February 27, 2014 and on Form 8-K
filed December 23, 2014. Upon execution of the credit agreement
described below, the lenders commitments under the Prior Credit
Facility were terminated and the outstanding liabilities of the
Firm with respect to its obligations under the Prior Credit
Facility were released and discharged. Most of the agents and
lenders under the Prior Credit Facility hold positions as agents
and/or lenders under the Firms new credit agreement described
below.
Item 2.03 Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement of a
Registrant.
Obligation under an Off-Balance Sheet Arrangement of a
Registrant.
On May 25, 2017, the Firm entered into a Credit Agreement with
Wells Fargo Bank, National Association, as administrative agent,
Bank of America, N.A., as syndication agent, Regions Bank and BMO
Harris Bank, N.A., as co-documentation agents, Wells Fargo
Securities, LLC, as lead arranger and bookrunner, and the lenders
referred to therein (the Credit Agreement).
Wells Fargo Bank, National Association, as administrative agent,
Bank of America, N.A., as syndication agent, Regions Bank and BMO
Harris Bank, N.A., as co-documentation agents, Wells Fargo
Securities, LLC, as lead arranger and bookrunner, and the lenders
referred to therein (the Credit Agreement).
Under the Credit Agreement, the Firm will have a maximum
borrowing capacity of $300 million, which may, subject to certain
conditions and the participation of the lenders, be increased up
to an aggregate additional amount of $150 million (the
Commitment), which will be available to the Firm in the form of
revolving credit loans, swingline loans, and letters of credit.
Letters of credit and swingline loans under the Credit Agreement
are subject to sublimits of $10 million. The maturity date of the
Credit Agreement is May 25, 2022 (the Maturity Date). The Firm is
obligated to repay the outstanding principal amount and all
accrued but unpaid interest under the revolving credit loans, if
not earlier repaid, in full on the Maturity Date. The Firm may
make optional prepayments on the loans, without penalty (other
than breakage fees), from time to time before the Maturity Date.
borrowing capacity of $300 million, which may, subject to certain
conditions and the participation of the lenders, be increased up
to an aggregate additional amount of $150 million (the
Commitment), which will be available to the Firm in the form of
revolving credit loans, swingline loans, and letters of credit.
Letters of credit and swingline loans under the Credit Agreement
are subject to sublimits of $10 million. The maturity date of the
Credit Agreement is May 25, 2022 (the Maturity Date). The Firm is
obligated to repay the outstanding principal amount and all
accrued but unpaid interest under the revolving credit loans, if
not earlier repaid, in full on the Maturity Date. The Firm may
make optional prepayments on the loans, without penalty (other
than breakage fees), from time to time before the Maturity Date.
On the date of the closing, the Firm made an initial draw of $115
million under the Credit Agreement to, among other things, pay
off the amounts owed under the Prior Credit Facility.
million under the Credit Agreement to, among other things, pay
off the amounts owed under the Prior Credit Facility.
Revolving credit loans under the Credit Agreement will bear
interest at a rate equal to (a) the Base Rate (as described
below) plus the Applicable Margin (as described below) or (b) the
LIBOR Rate plus the Applicable Margin. Swingline loans under the
Credit Agreement will bear interest at a rate equal to the Base
Rate plus the Applicable Margin. The Base Rate is the highest of:
(i) the Wells Fargo Bank, National Association prime rate, (ii)
the federal funds rate plus 0.50% or (iii) one-month LIBOR plus
1.00%, and the LIBOR Rate is reserve-adjusted LIBOR for the
applicable interest period, but not less than zero, each as more
fully described in the Credit Agreement. The Applicable Margin is
based on the Firms total leverage ratio, as more fully described
in the Credit Agreement. The Applicable Margin for Base Rate
loans ranges from 0.250% to 0.750% and the Applicable Margin for
LIBOR Rate loans ranges from 1.250% to 1.750%. As of the date of
the closing, the initial Applicable Margin for Base Rate loans is
0.375% and the initial Applicable Margin for LIBOR Rate loans is
1.375%.
interest at a rate equal to (a) the Base Rate (as described
below) plus the Applicable Margin (as described below) or (b) the
LIBOR Rate plus the Applicable Margin. Swingline loans under the
Credit Agreement will bear interest at a rate equal to the Base
Rate plus the Applicable Margin. The Base Rate is the highest of:
(i) the Wells Fargo Bank, National Association prime rate, (ii)
the federal funds rate plus 0.50% or (iii) one-month LIBOR plus
1.00%, and the LIBOR Rate is reserve-adjusted LIBOR for the
applicable interest period, but not less than zero, each as more
fully described in the Credit Agreement. The Applicable Margin is
based on the Firms total leverage ratio, as more fully described
in the Credit Agreement. The Applicable Margin for Base Rate
loans ranges from 0.250% to 0.750% and the Applicable Margin for
LIBOR Rate loans ranges from 1.250% to 1.750%. As of the date of
the closing, the initial Applicable Margin for Base Rate loans is
0.375% and the initial Applicable Margin for LIBOR Rate loans is
1.375%.
The Firm will pay a quarterly non-refundable commitment fee equal
to the Applicable Margin on the average daily unused portion of
the Commitment (swingline loans do not constitute usage for this
purpose). The Applicable Margin for the commitment fee is based
on the Firms total leverage ratio and ranges between 0.200%, and
0.350%. As of the date of the closing, the initial Applicable
Margin for the commitment fee is 0.20%.
to the Applicable Margin on the average daily unused portion of
the Commitment (swingline loans do not constitute usage for this
purpose). The Applicable Margin for the commitment fee is based
on the Firms total leverage ratio and ranges between 0.200%, and
0.350%. As of the date of the closing, the initial Applicable
Margin for the commitment fee is 0.20%.
The Firm was required to pay certain customary closing costs and
fees upon entering into the Credit Agreement. The Firm will
continually be subject to certain affirmative and negative
covenants including (but not limited to), the maintenance of a
fixed charge coverage ratio of no less than 1.25 to 1.00 and the
maintenance of a total leverage ratio of no greater than 3.25 to
1.00. The amounts owed under the Credit Agreement may be
accelerated upon the occurrence certain events of default
customary for similar facilities for similarly rated borrowers.
fees upon entering into the Credit Agreement. The Firm will
continually be subject to certain affirmative and negative
covenants including (but not limited to), the maintenance of a
fixed charge coverage ratio of no less than 1.25 to 1.00 and the
maintenance of a total leverage ratio of no greater than 3.25 to
1.00. The amounts owed under the Credit Agreement may be
accelerated upon the occurrence certain events of default
customary for similar facilities for similarly rated borrowers.
The foregoing summary of the Credit Agreement is not complete and
is qualified in its entirety by reference to the full text of the
Credit Agreement, which has been attached to this Current Report
on Form 8-K as Exhibit 10.1.
is qualified in its entirety by reference to the full text of the
Credit Agreement, which has been attached to this Current Report
on Form 8-K as Exhibit 10.1.
Item 7.01. Regulation FD Disclosure.
On May 25, 2017, the Firm issued a press release announcing the
Firms entry into the Credit Agreement. A copy of the press
release is furnished as Exhibit 99.1 to this Current Report and
is incorporated into this Current Report by reference.
Firms entry into the Credit Agreement. A copy of the press
release is furnished as Exhibit 99.1 to this Current Report and
is incorporated into this Current Report by reference.
The information furnished to Item 7.01 of this Current Report on
Form 8-K, including Exhibit 99.1, shall not be deemed to be filed
for the purposes of Section 18 of the Securities Exchange Act of
1934, as amended (the Exchange Act), or otherwise subject to the
liabilities of that section. The information furnished to Item
7.01 of this Current Report shall not be incorporated by
reference into any filing under the Securities Act, or Exchange
Act, whether made before or after the date of this Current Report
on Form 8-K, regardless of any general incorporation language in
the filing.
Form 8-K, including Exhibit 99.1, shall not be deemed to be filed
for the purposes of Section 18 of the Securities Exchange Act of
1934, as amended (the Exchange Act), or otherwise subject to the
liabilities of that section. The information furnished to Item
7.01 of this Current Report shall not be incorporated by
reference into any filing under the Securities Act, or Exchange
Act, whether made before or after the date of this Current Report
on Form 8-K, regardless of any general incorporation language in
the filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
|
Exhibit
Number
|
Description
|
|
|
10.1
|
Credit Agreement, dated May 25, 2017, between Kforce
Inc. and its subsidiaries and Wells Fargo Bank, National Association, and the other lenders thereto. |
|
|
99.1
|
Press Release, dated May 25, 2017, issued by Kforce
Inc. |
About Kforce Inc. (NASDAQ:KFRC)
Kforce Inc. is engaged in providing professional and technical specialty staffing services and solutions. The Company operates through three segments, which include Technology (Tech), which provides both temporary staffing and permanent placement services to its clients, focusing primarily on areas of information technology, such as systems/applications, e-commerce, technology infrastructure, network architecture and security; Finance and Accounting (FA), which is engaged in providing both temporary staffing and permanent placement services to its clients in areas, such as general accounting, business analysis and others, and Government Solutions (GS), which is engaged in providing services and solutions to the Federal Government as both a prime contractor and a subcontractor in the fields of information technology, and finance and accounting. The Company offers various staffing services that consist of temporary staffing services (Flex) and permanent placement services (Direct Hire). Kforce Inc. (NASDAQ:KFRC) Recent Trading Information
Kforce Inc. (NASDAQ:KFRC) closed its last trading session down -0.05 at 18.60 with 164,382 shares trading hands.
