Article 1.01. The conclusion of an important definitive agreement.
The Credit Facility is evidenced by the Credit and Guarantee Agreement, dated
Advances under the credit facility are subject to a borrowing basis calculation, with prepayment rates on eligible loans ranging from 50% to 75%. The credit facility has many eligibility criteria for loans to be included in the borrowing base. Advances under the credit facility bear interest at an annual variable rate equal to LIBOR plus 4.0%, with a LIBOR floor of 0.75%, and with the usual arrangements for choice by the lender and the company. a replacement reference rate. The Borrower shall pay an unused commission on the amount of the excess of the amount of the commitment over the principal unpaid each day at an annual rate equal to 0.75% if the use is less than 50% of the amount of commitment, or 0.50% if the use is less than or equal to 50% of the amount of the commitment. The obligations of the Borrower to lenders under the Credit Facility are secured by a first ranking security interest over substantially all of the assets of the Borrower. In addition, the Borrower’s obligations towards the lenders under the Credit Facility are guaranteed by a pledge by the Company of its interests in SIF II, evidenced by the Equity Pledge Agreement, dated
Under the Credit Agreement, the Company and SIF II have entered into a Loan and Contribution Sale Agreement, dated
In connection with the credit facility, the Company has made certain customary representations and warranties and is required to comply with various covenants, reporting obligations and other customary requirements for similar financings. Under the terms of the Credit Agreement, the Borrower must comply with the following financial covenants: (i) an Interest Coverage Test and (ii) an Over-Collateralization Test.
The Credit Facility contains typical events of default for similar financing transactions. In the event of default and during the persistence of an Event of Default, Encina may terminate the covenants and report outstanding advances and all other obligations under the Credit Facility immediately due and payable, subject to certain grace periods. and status quo described in the credit agreement.
The foregoing description is only a summary of the material provision of the Credit Facility and is qualified in its entirety by reference to the copies of the Credit and Guarantee Agreement, the Equity Collateral Agreement and the sales and contribution agreement, which are filed as attachments10. 1, 10.2 and 10.3, respectively, to this current report on Form 8-K and incorporated by reference herein. Capitalized terms not defined herein will have the meanings given to them in the Credit and Guarantee Agreement.
Article 2.03. Creation of a direct financial obligation or obligation under an off-balance sheet arrangement of a registrant.
The information set out in Section 1.01 of this current report on Form 8-K is incorporated herein by reference.
Article 9.01. Financial statements and supporting documents.
(d) Exhibits Exhibit No. Description 10.1 Credit and Security Agreement, dated as of
October 4, 2021, by and among Saratoga Investment Funding II, LLC, Saratoga Investment Corp., as collateral manager and equityholder, the lenders party thereto, Encina Lender Finance, LLC, as administrative agent for the secured parties and the collateral agent, and U.S. Bank National Association, as collateral custodian for the secured parties thereto and as collateral administrator 10.2 Equity Pledge Agreement, dated as of October 4, 2021, by and between Saratoga Investment Corp.and Encina Lender Finance, LLC, as collateral agent for the secured parties thereto 10.3 Loan Sale and Contribution Agreement, dated as of October 4, 2021, by and between Saratoga Investment Corp., as seller, and Saratoga Investment Funding II LLC, as purchaser 2
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