| Item 1.01 |
Entry into a Material Definitive Agreement. |
On October 30, 2024 (the “Effective Date”), KUEHG Corp. (“KUEHG”), a Delaware corporation and wholly owned subsidiary of KinderCare Learning Companies, Inc. (the “Company”), repaid a portion of its outstanding first lien term loans in a principal amount of approximately $608 million, plus accrued but unpaid interest, fees and expenses, under its credit agreement, dated as of June 12, 2023, among KUEHG, the Company, as a guarantor, the other guarantors named on the signature page therein, and the lenders party thereto (the “Credit Agreement”) (collectively, the “Term Loan Repayment”). The Company funded the Term Loan Repayment with the net proceeds of its initial public offering.
On the Effective Date, substantially concurrently with the Term Loan Repayment, KUEHG entered into Refinancing Amendment No. 4 to the Credit Agreement (the “Repricing Amendment”) among KUEHG, the Company, the guarantors identified therein, the lenders identified therein and Barclays Bank PLC, as administrative agent, which amends the Credit Agreement to reprice (i) its first lien term loans, which following the Term Loan Repayment, equal an outstanding principal amount of approximately $966.8 million (the “First Lien Term Loan Facility”) and (ii) its $240 million first lien revolving credit facility (the “First Lien Revolving Credit Facility”).
The Repricing Amendment amended the Credit Agreement to, among other things, (i) decrease the applicable margin for the First Lien Term Loan Facility to 3.25% with respect to secured overnight financing rate (“SOFR”) borrowings, (ii) decrease the applicable margin for the Borrower’s First Lien Revolving Credit Facility to an applicable rate between 2.75% and 3.25% per annum with respect to SOFR borrowings, based on KUEHG’s first lien net leverage ratio, and (iii) decrease fees on the outstanding balance of letters of credit to an applicable rate between 2.75% and 3.25% per annum, based on KUEHG’s first lien net leverage ratio. The Repricing Amendment also resets the soft call protection of 1% for certain repricing transactions applicable to the repriced First Lien Term Loan Facility for six months after the Effective Date.
The summary of the Repricing Amendment is qualified in its entirety by reference to the full text of the Repricing Amendment, a copy of which will be attached as an exhibit to the Company’s quarterly report on Form 10-Q for the fiscal quarter ended September 28, 2024.
| 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 in Item 1.01 is incorporated by reference to this Item 2.03.
