| Item 1.01 |
Entry into a Material Definitive Agreement. |
On June 9, 2023, Block, Inc. (formerly known as Square, Inc.) (“Block”) entered into the Seventh Amendment to Revolving Credit Agreement, among Block, the lenders that are party thereto, and Goldman Sachs Bank USA, as administrative agent (the “Revolver Amendment”). The Revolver Amendment amends the Revolving Credit Agreement, dated as of May 1, 2020 (as amended by the First Amendment to Revolving Credit Agreement, dated as of May 28, 2020, the Second Amendment to Revolving Credit Agreement, dated as of November 9, 2020, the Third Amendment to Revolving Credit Agreement, dated as of January 28, 2021, the Fourth Amendment to Revolving Credit Agreement, dated as of May 25, 2021, the Fifth Amendment to Revolving Credit Agreement, dated as of January 28, 2022, and the Sixth Amendment to Revolving Credit Agreement, dated as of February 23, 2022, the “Amended Credit Agreement”), among Block, the lenders that are party thereto, and Goldman Sachs Bank USA, as Administrative Agent, to, among other things, (i) extend the maturity date of the revolving loans under the Amended Credit Agreement to June 9, 2028 and (ii) provide for additional unsecured revolving loan commitments in an aggregate principal amount of up to $175 million. With the additional revolving loan commitments, the total revolving commitments under the Amended Credit Agreement increased to an aggregate principal amount of up to $775 million.
Under the Amended Credit Agreement, the revolving loans bear interest, at Block’s option, at an annual rate based on the forward-looking term rate based on the secured overnight financing rate (“Term SOFR”) or a base rate. Revolving loans based on Term SOFR shall bear interest at a rate equal to Term SOFR plus a margin of between 1.25% and 1.75%, depending on Block’s total net leverage ratio. Revolving loans based on the base rate shall bear interest at a rate based on the highest of the prime rate, the federal funds rate plus 0.50%, and Term SOFR with a tenor of one-month plus 1.00%, in each case, plus a margin ranging from 0.25% to 0.75%, depending on Block’s total net leverage ratio. Block is required to pay a commitment fee on the undrawn portion available under the revolving credit facility equal to a percentage per annum ranging from 0.10% to 0.20%, depending on Block’s total net leverage ratio. Currently, the total revolving commitments of up to $775 million remain undrawn.
The foregoing description of the Revolver Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Revolver Amendment, a copy of which is filed as Exhibit 10.1 hereto and incorporated herein by reference.