Business Context and Reporting Period
Company: Global Payments Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: June 19, 2018
Event: Entry into a Material Definitive Agreement (Fifth Amendment to Credit Facility).
Key Financial Metrics and Debt Structure
This filing details a restructuring of the company's credit facilities rather than reporting operational financial results (revenue, profit, or cash flow). The filing does not provide a clear value for current outstanding debt, though it notes the aggregate outstanding debt did not change as a result of the amendment.
| Facility Type | Capacity | Maturity Date |
|---|---|---|
| Revolving Credit Facility | $1.5 billion | January 20, 2023 |
| Term Loan A Facility | $1.5 billion | January 20, 2023 |
| Term Loan A-2 Facility | $1.37 billion | January 20, 2023 |
| Term Loan B-2 Facility | $1.14 billion | April 22, 2023 |
| Total Financing Capacity | Approx. $5.5 billion | - |
Interest Rates:
- Term Loan A/A-2 & Revolver: Base Rate + 0.25% to 1.00% (Base Rate Loans) or Base Rate + 1.25% to 2.00% (Eurocurrency Loans), dependent on leverage ratio.
- Term Loan B-2: Base Rate + 0.75% (Base Rate Loans) or Base Rate + 1.75% (Eurocurrency Loans).
- Commitment Fee (Revolver): 0.20% to 0.30% per annum, dependent on leverage ratio.
Material Changes Versus Prior Period
The Fifth Amendment increased the total financing capacity available under the Credit Facilities to approximately $5.5 billion. The filing explicitly states that the Company's aggregate outstanding debt under the Amended Credit Facility did not change as a result of this amendment. The amendment also permits the Company to incur Permitted Incremental Equivalent Debt and increase the Credit Facilities by an aggregate amount of up to $850 million, subject to lender consent.
Guidance, Outlook, Risks, and Contingencies
Covenants: The agreement includes customary affirmative and restrictive covenants, specifically financial covenants based on the Company's leverage and fixed charge coverage ratios.
Events of Default: The agreement includes customary events of default. If triggered and not cured, lenders may declare principal, accrued interest, and other obligations immediately due and payable.
Outlook: The filing does not provide specific operational guidance or management commentary regarding future revenue or earnings, focusing solely on the credit facility terms.
Important Facts for Investor Verification
- Verify the current leverage ratio to determine the specific interest rate margins and commitment fees applicable under the new terms.
- Confirm the exact amount of aggregate outstanding debt, as the filing states it did not change but does not disclose the specific figure.
- Review the upcoming Form 10-Q for the period ending June 30, 2018, for the full text of the Fifth Amendment and detailed financial statements.
- Monitor compliance with the new leverage and fixed charge coverage ratio covenants to avoid potential events of default.