Compass Inc.
11/17/2025 | Press release | Distributed by Public on 11/17/2025 16:16
Material Agreement, Financial Obligation (Form 8-K)
| Item 1.01. | Entry into a Material Definitive Agreement. |
On November 17, 2025, Compass, Inc. (the "Company") entered into a Revolving Credit and Guaranty Agreement (the "Credit Agreement") with Morgan Stanley Senior Funding, Inc., as administrative agent and as collateral agent (the "Administrative Agent") and a syndicate of other lenders.
Under the Credit Agreement, the Company obtained revolving commitments from lenders in an initial amount of $250 million (the "Revolving Credit Facility"). The lenders' commitments under the Revolving Credit Facility will automatically increase by $250 million to an aggregate amount of $500 million to the extent the contemplated merger with Anywhere Real Estate Inc. ("Anywhere" and such merger, the "Anywhere Merger") is consummated. The Revolving Credit Facility also includes a letter of credit sublimit of $100 million (which will automatically increase to $170 million to the extent the Anywhere Merger is consummated).
The Company's obligations under the Revolving Credit Facility are guaranteed by certain of the Company's subsidiaries and are secured by a first priority security interest in substantially all of the assets of the Company and the Company's subsidiary guarantors, subject to customary exceptions.
Borrowings under the Revolving Credit Facility bear interest at Term SOFR (as defined in the Credit Agreement) plus an applicable rate between 1.50% and 2.25% per annum, based on a pricing grid in which the levels are set based on the Company's Total Net Leverage Ratio (as defined in the Credit Agreement). The Company is also obligated to pay other customary fees under the Revolving Credit Facility, including (i) a commitment fee to the lenders on amounts they have committed, which are unused, of between 0.175% and 0.35% per annum, based on a pricing grid in which the levels are set based on the Company's Total Net Leverage Ratio, (ii) fees associated with the issuance of letters of credit, (iii) administrative agent fees, and (iv) upfront fees.
The maturity date of the Revolving Credit Facility is November 17, 2030, subject to, to the extent the Anywhere Merger is consummated, earlier springing maturity dates of 91 days prior to the maturity dates of certain series of Anywhere's second lien and unsecured notes if more than $50 million of such series of notes are at such time then outstanding, which the Company does not expect to occur as post-merger, the Company currently intends to pay off or refinance such second lien notes to forestall an earlier maturity.
The Company has the option to repay the Company's borrowings, and to permanently reduce the commitments in whole or in part, under the Revolving Credit Facility without premium or penalty.
The Credit Agreement contains customary representations, warranties, affirmative covenants, and negative covenants. The negative covenants restrict the Company's and its restricted subsidiaries' ability, among other things, to incur liens and indebtedness, make certain investments, declare and pay dividends, dispose of, transfer or sell assets, make stock repurchases and consummate certain other matters, all subject to certain exceptions. The financial covenants under the Revolving Credit Facility require that (a) prior to the consummation of the Anywhere Merger, the Company maintains (i) a minimum Liquidity (as defined in the Credit Agreement) level of at least $150 million, (ii) a minimum Consolidated Total Revenue (as defined in the Credit Agreement) of at least $4 billion and (iii) a minimum Total Net Leverage Ratio level of no greater than 3.00:1.00, and (b) following the consummation of the Anywhere Merger, the Company maintains a Total Net Leverage Ratio level of no greater than 5.00 to 1.00, stepping down to 4.50 to 1.00 and 4.25 to 1.00 on December 31, 2027 and December 31, 2028, respectively (with no requirement to maintain a minimum Liquidity level or a minimum Consolidated Total Revenue level).
The Credit Agreement includes customary events of default. The occurrence of an event of default could result in the acceleration of the obligations under the Revolving Credit Facility.
The foregoing description of the Credit Agreement is qualified in its entirety by reference to the full text of the Revolving Credit Facility, which is filed as Exhibit 10.1 to this Current Report on Form 8-K.
| Item 2.03. | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. | ||||
The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.03.
Compass Inc. published this content on November 17, 2025, and is solely responsible for the information contained herein. Distributed via Edgar on November 17, 2025 at 22:16 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]