TUCOWS INC (NASDAQ:TCX) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.
On June 14, 2019, the Company and its wholly owned subsidiaries, Tucows.com Co., Ting Fiber, Inc., Ting Inc., Tucows (Delaware) Inc. and Tucows (Emerald), LLC (each, a “Borrower” and together, the “Borrowers”and, collectively with Tucows, “the Company”), entered into an Amended and Restated Senior Secured Credit Agreement (the “Amended 2019 Credit Agreement”) with Royal Bank of Canada, as administrative agent, and the lenders party thereto (collectively, the “Lenders”) to refinance and replace the Company’s existing credit agreement.
The obligations of the Company under the Amended 2019 Credit Agreement will be secured by a first priority lien on substantially all of the personal property and assets of the Company. The Amended 2019 Credit Agreement has a four year term and provides the Company with access to an aggregate of up to $240 million (inclusive of a $60 million accordion facility).
Borrowings under the Amended 2019 Credit Agreement will accrue interest and standby fees based on the Company’s Total Funded Debt (as defined in the Amended 2019 Credit Agreement) to EBITDA (as defined in the Amended 2019 Credit Agreement) and the availment type as follows:
If Total Funded Debt to EBITDA is less than 1.00, then:
If Total Funded Debt to EBITDA is greater than or equal to 1.00 and less than 2.00, then:
If Total Funded Debt to EBITDA is greater than or equal to 2.00 and less than 2.50, then:
If Total Funded Debt to EBITDA is greater than or equal to 2.50, then:
The Amended 2019 Credit Agreement is revolving with interest only payments and no scheduled repayments during the term. The Amended 2019 Credit Agreement requires the Company to maintain a leverage ratio of Total Funded Debt to Adjusted EBITDA (as defined in the Amended 2019 Credit Agreement) ratio of not more than 3.50:1.00 at all times and Interest Coverage Ratio (as defined in the Amended 2019 Credit Agreement), as at the end of the financial quarter, of not less than 3.00:1.00.
The Amended 2019 Credit Agreement contains customary representations and warranties, affirmative and negative covenants, and events of default. The Amended 2019 Credit Agreement requires that the Company comply with certain customary non-financial covenants and restrictions.
The foregoing description of the Amended 2019 Credit Agreement does not purport to be complete and is subject to and qualified in its entirety by reference to the full text of the Amended 2019 Credit Agreement, a copy of which is attached hereto as Exhibit 10.1 and is incorporated by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of Registrant.
The information disclosed above in Item 1.01 is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
*Schedules to the agreement have been omitted to Item 601(a)(5) of Regulation S-K. The Company undertakes to furnish supplementally copies of any of the omitted schedules upon request by the SEC.
TUCOWS INC /PA/ Exhibit
EX-10.1 2 ex_147776.htm EXHIBIT 10.1 ex_147776.htm Exhibit 10.1 EXECUTION VERSION TUCOWS.COM CO. as Canadian Borrower – and – TUCOWS (DELAWARE) INC.,…
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About TUCOWS INC (NASDAQ:TCX)
Tucows Inc. is engaged in providing Internet services. The Company’s segments include Domain Services and Network Access Services. The Domain Services segment has over three service offerings, being wholesale and retail domain name registration services, value added services and portfolio. The Network Access Services segment includes mobile services and other services. The Network Access Services segment is engaged in the sale of retail mobile phones and services (Ting Mobile) to individuals and small businesses through the Ting Website, as well as other network access services, including high speed Internet access, Internet hosting and network consulting services. The Company focuses on serving the needs of network of resellers by providing services, interfaces, customer service, reseller-oriented technology, and design and development processes. The Company focuses its service offerings under brands, including OpenSRS, YummyNames, Platypus, Hover and Ting.
