Cognizant Enters $2.4B Credit Facility with $550M Term Loan, $1.85B Revolving Credit

Key Highlights

• Cognizant Technology Solutions Corp entered into a new credit agreement providing for a $550 million term loan facility and a $1.85 billion revolving credit facility.
• Proceeds from the $550 million term loan facility were used to repay an existing term loan.
• Approximately $1.0 billion was borrowed under the new $1.85 billion revolving credit facility to repay an existing revolving credit facility.
• The new credit facilities mature on October 3, 2031.
• The term loan facility requires quarterly installments of $6.875 million starting after the first year.
• The credit facilities are unsecured and bear interest at either the Term Benchmark or ABR Rate plus an applicable margin.
• The company can request an increase in the credit facilities by up to $1.2 billion.
• A financial covenant requires the Company not to exceed a maximum Leverage Ratio of 3.50:1.00, or 4.00:1.00 after certain acquisitions.