01—Abstract
Summary
Summary of the 8-K filed October 6, 2026. Cited figures are marked; the original filing is the authoritative source.
Cognizant Technology Solutions Corporation (CTSH) has entered into a new, unsecured credit agreement, establishing a $550 milliona Term Loan Facility and a $1.85 billion Revolving Credit Facility.
This new facility has a maturity date of October 3, 2031. The proceeds from the Term Loan Facility were used to refinance existing term debt, and approximately $1.0 billionb of the Revolving Credit Facility was drawn to refinance existing revolving credit. The Revolving Credit Facility is available for general corporate purposes.
This refinancing enhances the company's liquidity and extends its debt maturity profile. The new credit facilities are unsecured and bear interest based on either a Term Benchmark or ABR Rate, plus an applicable margin that will be determined by the company's Index Debt Rating or Leverage Ratio. A key financial covenant requires the Company to maintain a Leverage Ratio not exceeding 3.50:1.00, with a potential temporary increase to 4.00:1.00 following material acquisitions.
02—Key points
Key Highlights
- Entry into a new $2.4 billion unsecured credit facility comprised of a $550 million Term Loan Facility and a $1.85 billion Revolving Credit Facility.
- The new credit facilities mature on October 3, 2031, extending the company's debt maturity profile.
- Proceeds were used to repay and refinance existing credit facilities, indicating a deleveraging or restructuring of existing debt.
- The Revolving Credit Facility is available for general corporate purposes, providing ongoing financial flexibility.
- Interest rates are variable, tied to either Term Benchmark or ABR Rate, plus an applicable margin influenced by credit ratings and leverage.
- A financial covenant limits the Leverage Ratio to 3.50:1.00, with a temporary waiver to 4.00:1.00 permitted after acquisitions.
- The company has the option to increase the aggregate amount of the New Credit Facilities by up to $1.2 billion, subject to certain conditions.
03—Questions
Frequently Asked Questions
What is the total amount of the new credit facilities, and what are they comprised of?
The new credit facilities total $2.4 billion, consisting of a $550 million Term Loan Facility and a $1.85 billion Revolving Credit Facility.
What was the purpose of the new credit facilities?
The proceeds from the Term Loan Facility were used to repay an existing term loan. Approximately $1.0 billion of the Revolving Credit Facility was drawn to repay an existing revolving credit facility. The remaining capacity of the Revolving Credit Facility is available for general corporate purposes.
What is the maturity date of these new credit facilities?
The New Credit Facilities mature on October 3, 2031.
Are these new credit facilities secured or unsecured?
The New Credit Facilities are unsecured.
What is the key financial covenant associated with this new credit agreement?
The primary financial covenant requires the Company to maintain a Leverage Ratio of not in excess of 3.50:1.00. This ratio can be temporarily increased to 4.00:1.00 for up to four quarters following certain material acquisition transactions.
04—Continue