UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 OR 15(d)
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| Item 1.01. | Entry Into a Material Definitive Agreement. |
On April 23, 2021, San Jose Water Company (the “Company”), a wholly-owned subsidiary of SJW Group, entered into a $140,000,000 credit agreement (the “Credit Agreement”) with JPMorgan Chase Bank, N.A., as the lender (the “Lender”). The Credit Agreement provides an unsecured credit facility with a letter of credit sublimit of $15,000,000. Proceeds of borrowings under the Credit Agreement may be used to refinance existing debt, for working capital, and for general corporate purposes. The Credit Agreement has a maturity date of December 31, 2023.
Borrowings under the Credit Agreement bear interest at either the Alternate Base Rate (as defined in the Credit Agreement and hereinafter referred to as “ABR”) or the LIBO Rate (as defined in the Credit Agreement). ABR borrowings (which are borrowings bearing interest at a rate determined by reference to the ABR) will bear interest at a rate per annum equal to (i) the greatest of (a) the prime rate in effect on such day, (b) the federal funds effective rate on such day plus 0.5%, and (c) the adjusted LIBO Rate for a one-month interest period on such day plus 1% plus (ii) the Applicable Rate (as defined in the Credit Agreement), which is determined based on a pricing grid that is dependent upon the credit rating of the Company as determined by either S&P or Moody’s. Eurodollar borrowings under the Credit Agreement will bear interest at a rate per annum equal to (i) the adjusted LIBO Rate for the interest period in effect plus (ii) the Applicable Rate.
The Credit Agreement contains customary representations, warranties and events of default, as well as certain restrictive covenants customary for facilities of this type, including restrictions on indebtedness, liens, acquisitions and investments, restricted payments, asset sales, and fundamental changes. The Credit Agreement also includes a financial covenant that limits future Company borrowings by a maximum funded debt to capitalization ratio.
The Credit Agreement replaces the existing $140,000,000 credit agreement, dated June 1, 2016, as amended from time to time, between the Company and the Lender, which has been paid-off and was set to mature and expire on June 1, 2021.
The foregoing description of the Credit Agreement and the transactions contemplated thereby is qualified in its entirety by reference to the full text of the Credit Agreement, a copy of which is filed as Exhibit 10.1 to this Form 8-K and incorporated herein by reference.
| Item 2.03. | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
Please see disclosure set forth under Item 1.01 hereto, which is incorporated by reference into this item 2.03.
| Item 8.01. | Other Events. |
On April 23, 2021, SJW Group, as guarantor, and SJWTX, Inc., a wholly-owned subsidiary of SJW Group (the “Borrower”), entered into a $5,000,000 credit agreement with the Lender (the “SJWTX Credit Agreement”), which provides an unsecured credit facility to the Borrower with a letter of credit sublimit of $1,000,000. The SJWTX Credit Agreement matures on December 31, 2023. Borrowings under the SJWTX Credit Agreement bear interest on the same terms as those in the Credit Agreement. The SJWTX Credit Agreement replaces the existing $5,000,000 credit agreement, dated June 1, 2016, as amended from time to time, between the Borrower and the Lender, which has been paid-off and was set to mature and expire on June 1, 2021.
| Item 9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits |
Exhibit Index
| Exhibit |
Description | |
| 10.1 | Credit Agreement, dated April 23, 2021, between San Jose Water Company and JPMorgan Chase Bank, N.A. | |
| 104 | Cover Page Interactive Data File - the cover page XBRL tags are embedded within Inline XBRL document | |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| SJW GROUP | ||||||
| Date: April 23, 2021 | By: | /s/ James P. Lynch | ||||
| Name: James P. Lynch | ||||||
| Title: Chief Financial Officer and Treasurer | ||||||