AVERY DENNISON CORP : Entry into a Material Definitive Agreement, Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant, Financial Statements and Exhibits (form 8-K)
Item 1.01 Entry into a Material Definitive Agreement.
On February13, 2020,
"Company"), entered into a Fifth Amended and Restated Credit Agreement (the
"Credit Agreement"), with a syndicate of lenders party thereto,
and restates the Company's Fourth Amended and Restated Credit Agreement dated as
Under the Credit Agreement, the Company may borrow up to an aggregate of
subject to certain customary requirements, the commitments under the Credit
Agreement may be increased by up to an aggregate of
Company's request. The Credit Agreement's maturity date is
however, the Company may request that the commitments be extended for a one-year
period under certain circumstances as set forth in the Credit Agreement.
Loans outstanding under the Credit Agreement bear interest, at the Company's
option, at the base rate or the Eurocurrency rate, in each case plus an
applicable per annum margin. The applicable per annum margin is determined
based on the Company's debt ratings in accordance with a pricing grid, with the
per annum margin for base rate borrowings ranging from 0.00% to 0.275% and the
per annum margin for Eurocurrency rate borrowings ranging from 0.795% to
1.275%. The terms "base rate" and "Eurocurrency rate" have meanings customary
for financings of this type. Fees payable for the revolving commitments under
the Credit Agreement, whether used or unused, are also determined based on the
Company's debt ratings in accordance with a pricing grid, with the per annum
percentage ranging from 0.080% to 0.225%.
The Loans may, at the Company's option, be prepaid in whole or in part without
premium or penalty (except for breakage costs for Eurocurrency rate loans) and
the Company may reduce or terminate the commitments of the lenders to make the
The Credit Agreement contains customary affirmative and negative covenants,
including limitations on mergers, asset sales, liens, investments, and
subsidiary indebtedness. In addition, the Credit Agreement requires the Company
to maintain a maximum leverage ratio (calculated as a ratio of consolidated debt
to consolidated EBITDA) of not more than 3.50 to 1.00; provided that, in the
event of an acquisition by the Company that exceeds
leverage ratio shall increase to 4.00 to 1.00 for the fiscal quarter in which
such acquisition occurs and the period of three consecutive fiscal quarters
immediately following such fiscal quarter.
The summary of the Credit Agreement contained herein is qualified in its
entirety by reference to the terms of the Credit Agreement, a copy of which is
filed as Exhibit 10.1 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.
The information set forth under Item 1.01 is incorporated by reference into this
Item 9.01 Financial Statements and Exhibits
Number Exhibit Title
10.1 Fifth Amended and Restated Credit Agreement, dated as of
agent, and the other lenders party thereto.
104 Cover Page Interactive Data File (formatted as Inline XBRL and
contained in Exhibit 101).
This Form 8-K contains forward-looking statements, including statements related
to the expected use of proceeds from the Credit Agreement, which are based on
the Company's current expectations, forecasts and assumptions that involve risks
and uncertainties that could cause actual results to differ materially from any
future results, performance or achievements expressed or implied by these
forward-looking statements. These risks and uncertainties include, without
limitation, risks related to the fact that the Company's management will have
discretion in its use of the proceeds. The Company refers you to the documents
it files with the
titled "Item 1A. Risk Factors" of its Annual Report on Form 10-K for the year
contain and identify important factors that could cause actual results to differ
materially from those contained in the Company's forward-looking statements. The
Company's forward-looking statements are made only as of the date hereof. The
Company assumes no duty to update these forward-looking statements to reflect
new, changed or unanticipated events or circumstances, other than as may be
required by law.
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