Summary
GLOBAL PAYMENTS INC (GPN) filed an 8-K on August 6, 2015, to report the execution of a Second Amended and Restated Term Loan Agreement and a Second Amended and Restated Credit Agreement with Bank of America, N.A., effective July 31, 2015. These agreements amend and restate prior facilities, establishing a $1.75 billion senior unsecured term loan and a $1.25 billion senior unsecured revolving credit facility, both maturing in July 2020. The company also has the option to increase the revolving credit facility by an additional $500 million under certain conditions. This refinancing effectively replaces the company's existing credit lines. The proceeds from the new facilities were used to repay the outstanding balances on the prior revolving credit facility and a term loan of approximately $1.23 billion. The remaining funds are earmarked for strategic capital allocation, including potential acquisitions and ongoing share repurchases. The agreements include standard covenants related to leverage and fixed charge coverage ratios, and customary events of default.
Key Highlights
- 1Global Payments entered into new senior unsecured credit facilities totaling $3.0 billion ($1.75B Term Loan + $1.25B Revolving Credit Facility).
- 2The company has the option to expand the revolving credit facility by an additional $500 million.
- 3Both the Term Loan and Revolving Credit Facility mature in July 2020.
- 4The new facilities were used to refinance existing debt, including approximately $1.23 billion on the previous term loan.
- 5Proceeds will support strategic initiatives such as acquisitions and share repurchases.
- 6Interest rates are variable, based on either LIBOR or a base rate plus a margin dependent on the Company's leverage ratio.
- 7The agreements include customary financial covenants (leverage and fixed charge coverage) and events of default.