| Item 1.01. |
Entry into a Material Definitive Agreement.
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On January 19, 2023, Adobe Inc. (the “Company”) entered into a
delayed draw term loan credit agreement (the “Term Loan Credit
Agreement”), among the Company, Bank of America, N.A., as
administrative agent, and the lenders party thereto, providing for
an up to $3.5 billion senior unsecured term loan (the “Term
Loan”). The proceeds from the Term Loan will be used (i) to
pay a portion of the cash consideration for the acquisition (the
“Figma Acquisition”) by the Company of all of the issued and
outstanding equity interests of Figma, Inc., a Delaware
corporation, pursuant to the Company’s previously disclosed
Agreement and Plan of Merger, dated as of September 15, 2022
(the “Merger Agreement”), by and among the Company, Saratoga Merger
Sub I, Inc., a Delaware corporation and a direct, wholly owned
subsidiary of the Company, Saratoga Merger Sub II, LLC, a Delaware
limited liability company and a direct, wholly owned subsidiary of
the Company and Fortis Advisors LLC, a Delaware limited liability
company, and (ii) to pay the fees and expenses incurred in
connection with the Term Loan Credit Agreement and the Figma
Acquisition. The Term Loan is available for funding in a single
drawing upon the consummation of the Figma Acquisition at any time
prior to September 15, 2023 (or December 15, 2023 if the
outside date under the Merger Agreement is also extended to
December 15, 2023, or March 15, 2024 if the outside date
under the Merger Agreement is further extended to March 15,
2024). The Term Loan will mature two years following the initial
funding date and requires no scheduled principal amortization
payments prior to maturity. The Term Loan may be prepaid, and the
Term Loan Credit Agreement may be terminated, at the election of
the Company at any time without premium or penalty.
At the Company’s election, the Term Loan will bear interest at
either (i) Term SOFR (as defined in the Term Loan Credit
Agreement) plus an applicable margin, (ii) the Adjusted Daily
SOFR Rate (as defined in the Term Loan Credit Agreement) plus an
applicable margin or (iii) a Base Rate (as defined in the Term
Loan Credit Agreement) plus an applicable margin. The applicable
margin is based on the Company’s debt rating. Commencing on the
closing date of the Term Loan Credit Agreement and at all times
thereafter until the funding of the Term Loan, commitment fees
determined according to the Company’s debt ratings are payable
quarterly on the aggregate unused commitments.
The Term Loan Credit Agreement contains customary representations,
warranties, affirmative and negative covenants, events of default
and indemnification provisions in favor of the lenders. The
negative covenants include restrictions regarding the incurrence of
liens, certain merger transactions and other matters, all subject
to certain exceptions.
The Term Loan Credit Agreement contains customary events of default
relating to, among other things, payment defaults, breach of
covenants, cross acceleration to material indebtedness,
bankruptcy-related defaults, judgment defaults, and the occurrence
of certain change of control events. The occurrence of an event of
default may result in the termination of the Term Loan Credit
Agreement and acceleration of repayment obligations with respect to
any outstanding principal amounts.
In the ordinary course of their respective businesses, one or more
of the lenders under the Term Loan Credit Agreement, or their
affiliates, have or may have various relationships with the Company
and the Company’s subsidiaries involving the provision of a variety
of financial services, including cash management, commercial
banking, investment banking, advisory or other financial services,
for which they received, or will receive, customary fees and
expenses. In addition, the Company and the Company’s subsidiaries
may have entered into or may in the future enter into in certain
engagements with one or more of such lenders or their affiliates
relating to specific endeavors.
The description of the Term Loan Credit Agreement provided above
does not purport to be complete and is qualified in its entirety by
reference to the full text of the Term Loan Credit Agreement, which
is filed as Exhibit 10.1 to this Current Report on Form
8-K, which is incorporated
herein by reference. The description of the Merger Agreement
referenced above does not purport to be complete and is qualified
in its entirety by reference to the full text of the Merger
Agreement, which is filed as Exhibit 2.1 to the Company’s Current
Report on Form 8-K filed on
September 15, 2022.
| 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 is hereby
incorporated by reference into this Item 2.03.