CDW Corp Form 8-K Summary
Business Context and Reporting Period
This Current Report on Form 8-K was filed by CDW Corporation on March 30, 2021, regarding events occurring on March 26, 2021. The filing details the amendment, extension, and expansion of the company's senior secured asset-based revolving credit facility.
Key Financial Metrics and Debt Structure
The filing focuses on debt capacity and liquidity terms rather than operational performance metrics such as revenue or profit.
- Revolving Credit Facility Size: Increased from $1,450.0 million to $1,600.0 million.
- UK Borrower Capacity: Up to $150.0 million of the facility may be borrowed by CDW Finance Holdings Limited.
- Maturity Date: Extended from March 31, 2022, to March 26, 2026.
- Interest Rates: Variable rates based on LIBOR, alternate base rates, EURIBOR, or overnight bank funding rates, plus an applicable margin tied to average daily excess cash availability.
- Liquidity Conditions: Borrowing is subject to a minimum liquidity condition. If excess cash availability falls below the lesser of $138.0 million or the greater of 10% of the borrowing base and $110.0 million, lenders are not required to lend additional amounts unless the consolidated fixed charge coverage ratio is at least 1.00 to 1.00.
The filing text does not provide clear values for revenue, net income, operating cash flow, or current debt balances.
Material Changes Versus Prior Period
Compared to the prior credit agreement dated March 31, 2017, the material changes include:
- Capacity Increase: An additional $150.0 million in total borrowing capacity.
- Term Extension: The maturity date has been extended by approximately four years.
- New Borrower: CDW Finance Holdings Limited (UK Borrower) has been added as a borrower party, though it does not provide guarantees or collateral support unless the Company elects otherwise.
Guidance, Outlook, and Risks
The filing does not contain forward-looking guidance, management commentary on business outlook, or specific risk factors beyond the standard terms of the credit agreement. The primary contingency noted is the minimum liquidity condition which restricts access to funds if specific cash availability thresholds are not met.
Key Facts for Investor Verification
- Verify the total available borrowing capacity is now $1.6 billion.
- Confirm the new maturity date of the credit facility is March 26, 2026.
- Review the specific calculation of "excess cash availability" to understand the liquidity covenant triggers.
- Check the consolidated fixed charge coverage ratio in the most recent 10-Q or 10-K to ensure compliance with the 1.00 to 1.00 threshold required for borrowing under constrained liquidity conditions.
- Examine the full text of the Third Amended and Restated Revolving Loan Credit Agreement (Exhibit 10.1) for detailed fee structures and covenants.