Item 1.01. Entry into a Material Definitive Agreement.
On August 24, 2021, MSC Industrial Direct Co., Inc. (the "Company") entered into
Amendment No. 1 to the Credit Agreement, dated as of August 24, 2021 (the
"Amendment"), by and among the Company, the subsidiary guarantors party thereto,
the lenders and issuing lenders party thereto (the "Lenders"), and JPMorgan
Chase Bank, N.A., as administrative agent (the "Administrative Agent"), which
amends the Company's existing Credit Agreement, dated as of April 14, 2017 (as
amended, the "Credit Agreement"), by and among the Company, the financial
institutions party thereto as lenders and the Administrative Agent. The
Amendment provides for, among other things: (i) an extension of the maturity
date for the Company's existing $600 million unsecured revolving loan facility
(the "Credit Facility") to August 24, 2026; (ii) updates to the
performance-based pricing grid determined by the Company's consolidated leverage
ratio (as defined in the Credit Agreement); (iii) the replacement of certain
Lenders under the Credit Facility; (iv) the addition of certain subsidiary
guarantors; (v) procedures for the succession from the London Interbank Offered
Rate ("LIBOR") to an alternative benchmark reference rate; and (vi) customary
new provisions relating to qualified financial contracts, sanctions and
anti-money laundering rules and laws.
Pursuant to the Amendment, borrowings under the Credit Facility bear interest,
at the Company's option, either at (i) LIBOR plus the applicable margin for
LIBOR loans ranging from 0.875% to 1.250%, based on the Company's consolidated
leverage ratio; or (ii) the greatest of (a) the Administrative Agent's prime
rate in effect on such day, (b) the federal funds effective rate in effect on
such day, plus 0.50% and (c) the applicable LIBOR for a one month interest
period on such day, plus 1.00%, plus, in the case of each of clauses (a) through
(c), an applicable margin ranging from 0.00% to 0.250%, based on the Company's
consolidated leverage ratio. The Company is required to pay a quarterly undrawn
fee ranging from 0.075% to 0.175% per annum on the unutilized portion of the
Credit Facility, based on the Company's consolidated leverage ratio. The Company
is also required to pay quarterly letter of credit usage fees ranging between
0.875% to 1.250% (based on the Company's consolidated leverage ratio) on the
amount of the daily average outstanding letters of credit, and a quarterly
fronting fee of 0.125% per annum on the undrawn and unexpired amount of each
letter of credit. As amended, the Credit Facility continues to include customary
covenants, representations and warranties and events of default.
The foregoing description of the Amendment is not complete and is qualified in
its entirety by reference to the full terms and conditions of the Amendment,
which is filed as Exhibit 10.1 to this Current Report on Form 8-K and
incorporated herein by reference.
Certain of the Lenders under the Credit Facility and/or their affiliates have
from time to time performed, and may in the future perform, various commercial
banking, investment banking and other financial advisory services for the
Company and/or its subsidiaries in the ordinary course of business, for which
they have received or will receive customary fees and commissions.
Item 2.03. Creation of a direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The information set forth above under Item 1.01 above is hereby incorporated by
reference into this Item 2.03.
Item 9.01. Financial Statements and Exhibits.
10.1 Amendment No.1 to Credit Agreement, dated as of August 24, 2021,
by and among MSC Industrial Direct Co., Inc., the subsidiary
guarantors party thereto, the lenders and issuing lenders party
thereto, and JPMorgan Chase Bank, N.A., as administrative agent.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
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