Item 1.01 Entry into a Material Definitive Agreement. OnJune 29, 2021 ,EastGroup Properties, Inc. ("EastGroup") and one of its subsidiaries,EastGroup Properties, L.P. (together, the "Company"), entered into a Fifth Amended and Restated Credit Agreement (the "Revolving Facility") with the lender parties thereto, andPNC Bank, National Association , as Administrative Agent,Regions Bank , as Syndication Agent,Wells Fargo Bank, National Association ,Bank of America, N.A . andU.S. Bank National Association , as Co-Documentation Agents,PNC Capital Markets LLC as Sustainability Agent, PNC Capital Markets LLC andRegions Capital Markets , as Joint Lead Arrangers and Joint Bookrunners. The Revolving Facility replaced the Company's existing$350 million unsecured revolving credit facility (the "Existing Revolving Facility"), dated as ofJune 14, 2018 , by and among the Company, the lender parties thereto, andPNC Bank, National Association , as Administrative Agent,Regions Bank as Syndication Agent,U.S. Bank National Association ,Wells Fargo Bank, National Association andBank of America, N.A ., as Co-Documentation Agents, and PNC Capital Markets LLC andRegions Capital Markets , as Joint Lead Arrangers and Joint Bookrunners. The Revolving Facility allows for borrowings in the aggregate principal amount of up to$425 million . Borrowings will bear interest, at the Company's option, at the Base Rate Option (as defined in the Revolving Facility) plus a margin of 0.00% to 0.40% or at LIBOR plus a margin of 0.725% to 1.40%, in each case depending on EastGroup's credit ratings. The Revolving Facility initially bears interest at LIBOR plus 0.775% which is the equivalent of 0.87525% atJune 29, 2021 . The facility fee of the Revolving Facility ranges between 0.125% to 0.30% per annum and is currently set at 0.15%, also based upon EastGroup's credit ratings. The Revolving Facility includes a$325 million accordion feature and has an initial maturity date ofJuly 30, 2025 with two six-month extensions at the Company's option. The Revolving Facility contains various customary covenants, including covenants that require the Company to maintain (i) its ratio of total liabilities to total asset value at 60% or less, subject to certain exceptions, (ii) its secured debt to total asset value at 30% or less, (iii) a fixed charge coverage ratio of at least 1.50:1.00 and (iv) a ratio of unencumbered net operating income to total unsecured interest expense of at least 1.75:1.00. In addition, the Company may not pay dividends or make distributions with respect to its equity in excess of 90% of the Company's Funds From Operations, as defined in the Revolving Facility, except to the extent necessary to enable EastGroup to continue to qualify as a real estate investment trust for Federal income tax purposes. These covenants and restrictions also limit the Company's ability to incur additional indebtedness, merge, consolidate or sell all or substantially all of its assets and enter into transactions with affiliates. The Revolving Facility also includes a sustainability-linked pricing component pursuant to which, if the Company meets certain sustainability performance targets, the applicable interest margin will be reduced by one basis point. The LIBOR replacement provisions in the Revolving Facility permit the use of rates based on the secured overnight financing rate ("SOFR") administered by theFederal Reserve Bank of New York plus an applicable spread adjustment. The Revolving Facility also includes customary events of default, including failure to pay principal, interest or fees when due, failure to comply with covenants, if any representations or warranty made by the Company is false or misleading in any material respect, default under certain other indebtedness, certain insolvency or receivership events affecting the Company and its subsidiaries, the occurrence of certain material judgments, or a change in control of the Company. The amounts outstanding under the Revolving Facility may be accelerated upon certain events of default. Some of the lenders party to the Revolving Facility or their affiliates have from time to time provided in the past, and may provide in the future, commercial lending services to the Company and its affiliates in the ordinary course of business. The foregoing summary description of the Revolving Facility does not purport to be complete and is qualified in its entirety by reference to the full text of the Revolving Facility, which is filed as Exhibit 10.1 hereto and is incorporated herein by reference. Item 1.02 Termination of a Material Definitive Agreement. OnJune 29, 2021 , in connection with the entrance into the Revolving Facility, the Company repaid all of the outstanding obligations under and terminated the Existing Revolving Facility. 2 of 4 Pages -------------------------------------------------------------------------------- Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. The information provided in Item 1.01 on this Form 8-K is incorporated herein by reference. Item 8.01 Other Events. OnJune 29, 2021 , the Company expanded its unsecured working cash credit facility with PNC Bank (the "Working Cash Line") from$45 million to$50 million and extended the expiration date toJuly 30, 2025 with two six-month extensions. The Working Cash Line was extended under substantially the same terms and conditions as the Revolving Facility.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. Exhibit No. Description 10.1 Fifth Amended and Restated Credit Agreement DatedJune 29, 2021 amongEastGroup Properties, L.P. ; EastGroup
Association, as Administrative Agent; Regions
Bank, as Syndication Agent,
Wells Fargo Bank, National Association , Bank of
National Association, as Co-Documentation
Agents;
Sustainability Agent;PNC Capital Markets LLC
and
as Joint Lead Arrangers and Joint Bookrunners
and the Lenders party thereto.
104 Cover Page Interactive Data File (embedded
within the Inline XBRL document).
3 of 4 Pages
--------------------------------------------------------------------------------
© Edgar Online, source