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| On March 19, 2024, Zebra Technologies International, LLC (“ZTI”) and Zebra Technologies RSC, LLC (“ZTRSC”), both of which are wholly-owned subsidiaries of Zebra Technologies Corporation (the “Company”), entered into the third amendment (the “Third Amendment”) to that certain Receivables Financing Agreement (the “Financing Agreement”),
dated as of December 1, 2017, as previously amended on May 20, 2019 and March 19, 2021, by and among ZTI, as originator and servicer, ZTRSC, as borrower, PNC Bank, National Association (“PNC”), as administrative agent, PNC Capital Markets LLC, as structuring agent, and additional persons from time to time party thereto as lenders and group agents (“Lenders”), pursuant to which the Lenders have agreed to provide financing for ZTRSC’s purchase of certain receivables from ZTI. |
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| The Financing Agreement provides ZTRSC with a revolving U.S. trade receivables securitization facility (the “A/R Facility”)
in a maximum principal amount of $180 million based on the availability of eligible receivables and other customary factors, and the satisfaction of certain conditions. Under the A/R Facility, ZTI will sell or contribute certain of its U.S. trade receivables to ZTRSC. ZTRSC has pledged those trade receivables to PNC, as administrative agent, for the benefit of the Lenders, to secure ZTRSC’s obligations to repay advances that it obtains from the Lenders under the Financing Agreement. Substantially all of the net proceeds of the advances are expected to be applied towards the purchase of trade receivables by ZTRSC from ZTI. |
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| The Company has guaranteed ZTI’s performance of its
obligations as servicer and originator under the A/R Facility. If ZTI fails in any manner to perform its obligations under the A/R Facility, then the Company is required to perform (or cause to be performed) those obligations as required under the A/R Facility. |
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| The Third Amendment (i) extends the scheduled termination date of the A/R Facility from March 19, 2024 to March 19, 2027, (ii) allows for a potential increase in the available amount the borrower may draw under the A/R Facility through various structural changes to certain calculations of the Borrowing Base (as defined
in the Financing Agreement) and (iii) affirmatively incorporates the existing Benchmark Replacement (as defined in the Financing Agreement) to reflect the change in the Interest Rate from LIBOR to SOFR since the setting of LIBOR in June 2023, including integrating further updated guideline language from the Alternative Reference Rates Committee convened by the Federal Reserve Board and the Federal Reserve Bank of New York. The Third Amendment does not modify in any way the Company’s guarantee of ZTI’s performance of its obligations as servicer and originator under the A/R Facility. |
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| The foregoing description of the Third Amendment does not purport to be complete and is qualified
in its entirety by reference to the full text of the composite version of the Financing Agreement, including amendments thereto, described above. A copy of the Third Amendment will be filed as an exhibit in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 30, 2024. |
