ENGAGESMART, INC. : Conclusion of a material definitive agreement, financial statements and supporting documents (form 8-K)


Article 1.01. The conclusion of an important definitive agreement.

At September 27, 2021, EngageSmart, Inc. (the “Borrower”), as the borrower, has entered into a revolving credit agreement (the “Credit Agreement”) with the lenders who are parties thereto, JPMorgan Chase Bank, NA., as administrative agent (the “Administrative Agent”) and other parties who are parties to it.

The credit agreement includes a $ 75.0 million Revolving credit facility,
$ 7.5 million of which may consist of a letter of credit facility. The credit agreement will expire on September 27, 2026. The proceeds of borrowings under the credit agreement will be used for general corporate purposes.

The obligations under the Credit Agreement are secured by significant domestic subsidiaries, direct and indirect, wholly owned by the Borrower, subject to certain exceptions. The obligations are secured by a security interest in substantially all of the assets of the Borrower and its significant direct and indirect wholly owned domestic subsidiaries, subject to certain exceptions.

Borrowings under the Credit Agreement will bear interest at an equal rate, at the choice of the Borrower, i.e. (a) at a LIBOR rate determined by reference to the cost of funds for Eurodollar deposits for the interest period applicable to this loan, adjusted by certain or (b) a base rate determined by reference to the higher of (i) the federal funds rate plus 0.50%, (ii) the prime rate proposed by the the Wall Street newspaper and (iii) one-month adjusted LIBOR plus 1.00%, in each case plus an applicable margin. In addition, the Credit Agreement requires the Borrower to pay a commitment fee for unused revolving credit facility commitments of 0.25% per annum for unused commitments under the Credit Agreement.

The Credit Agreement contains certain customary events of default, including in the event of a change of control, and certain covenants and restrictions which limit the ability of the Borrower and its subsidiaries to, among other things, incur additional debt; create privileges on certain assets; pay dividends or make distributions on their capital stock or make other restricted payments; consolidate, merge, sell or otherwise dispose of all or substantially all of their assets; and enter into certain transactions with their affiliates.

The Borrower is also subject to certain financial sustaining covenants under the Credit Agreement, which require the Borrower and its subsidiaries not to exceed certain specified total net leverage ratios at the end of each fiscal quarter.

If the Borrower fails to meet its obligations under these and other covenants, or in the event of default, the commitments of the revolving credit facility under the Credit Agreement may be terminated and any borrowing may be terminated. course, as well as accrued interest, under the Credit Agreement could be declared immediately due and payable.

The foregoing description of the Credit Agreement does not purport to be complete and is subject to, and qualified in its entirety by reference to the full text of the Credit Agreement, a copy of which is attached hereto as Exhibit 10.1 and incorporated by reference herein.

Article 9.01. Financial statements and supporting documents

                  Exhibit No.   Description

                  10.1            Revolving Credit Agreement

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