Commercial Metals Company (NYSE:CMC) Files An 8-K Entry into a Material Definitive Agreement

Item1.01

Amendments to Credit Agreement

On June23, 2017, Commercial Metals Company (the
Company) and CMC International Finance
S. R.L., its wholly owned subsidiary, entered into a Second
Amendment (the Second Amendment) to the
Fourth Amended and Restated Credit Agreement (as amended, the
Credit Agreement) with Bank of America,
N.A., as Administrative Agent, Swing Line Lender and L/C Issuer,
the lenders from time to time party thereto, Wells Fargo Bank,
National Association, Citibank, N.A. and PNC Bank, National
Association as Co-Syndication Agents, and Merrill Lynch, Pierce,
Fenner Smith Incorporated, Wells Fargo Bank, National
Association, PNC Bank, National Association and Citibank, N.A. as
Joint Lead Arrangers and Joint Book Managers.

The Second Amendment amends the Credit Agreement to, among other
things, (i)provide for a coterminous delayed draw term loan in
the maximum principal amount of $150.0million (the
Term Loan), (ii) extend the maturity
date of the Credit Agreement to June 23, 2022, (iii) provide
that, with bank approval and subject to the satisfaction of
certain conditions, the Company may increase the Revolving Credit
Facility (as defined in the Credit Agreement) and/or establish a
new term loan in an amount (in the aggregate) not exceeding
$250.0million and (iv)make certain other changes to the lender
syndicate.

The Term Loan will mature on June23, 2022 and generally will bear
interest on the same terms and conditions of the revolving credit
facility under the Credit Agreement. The Term Loan will be
jointly and severally guaranteed by all of the Companys
subsidiaries that guarantee its indebtedness under the Credit
Agreement and will be secured by first-priority liens on the
Companys U.S. inventory and the Companys U.S. receivables
originated by its steel fabricating business.

As provided in the Credit Agreement, to the extent the Term Loan
is not repaid earlier, the Company will be required to make
principal payments on the Term Loan in quarterly installments in
an amount equal to 1.25% of the original drawn principal amount
after giving effect to any prior payments or prepayments. Such
principal payments will be due on the last business day of each
of the Companys fiscal quarters following the funding date of the
Term Loan for the life of the Term Loan. The proceeds of the Term
Loan are to be used for general corporate purposes, including,
without limitation, funding the partial repayment of the Companys
outstanding 6.500% Senior Notes due 2017 (the 2017
Notes) and the Companys 7.350% Senior Notes due
2018. The Company currently anticipates drawing on the Term Loan
to, in part, partially repay the 2017 Notes, of which there are
$300.0million aggregate principal amount outstanding.

In addition, on June23, 2017, we entered into a Third Amendment
(the Third Amendment) to the Credit
Agreement to, among other things, permit the Companys previously
announced plan to exit its International Marketing and
Distribution Segment (the Exit Plan)
and its disposition of its raw materials trading division
(CMC Cometals) to an Interest Purchase
Agreement with Traxys North America LLC and Traxys Europe S.A.,
which are affiliates of The Carlyle Group, as well as the
Companys plan to pursue a sale of its CMC Cometals Steel division
and a restructuring and sale of its remaining trading operations
located in Asia and Australia (collectively, the
Other MD Entities).

The foregoing description of the Second Amendment and the Third
Amendment does not purport to be complete and is qualified in its
entirety by the Second Amendment and the Third Amendment, copies
of which are filed as Exhibit 10.1 and Exhibit 10.2 to this
Current Report on Form 8-K and are incorporated herein by
reference.

Receivables Agreements Amendment

On June23, 2017, the Company entered into an Omnibus Amendment
No.3 (the Omnibus Amendment) to (i)its
Receivables Sale Agreement, dated April5, 2011, by and among the
Company, CMC Receivables, Inc. and several of the Companys
subsidiaries, (ii)its Receivables Purchase Agreement, dated
April5, 2011, by and among the Company, CMC Receivables, Inc.,
certain purchasers named therein and Wells Fargo Bank, N.A., as
administrative agent for the purchasers, and (iii)its associated
Performance Undertaking, dated April5, 2011, executed by the
Company in favor of CMC Receivables, Inc. (collectively, the
Receivables Agreements). The Omnibus
Amendment amended the Receivables Agreements to, among other
things, permit the transactions contemplated by the Exit Plan,
including, without limitation, the disposition of CMC Cometals
and the Other MD Entities.

The foregoing description of the Omnibus Amendment does not
purport to be complete and is qualified in its entirety by the
Omnibus Amendment, a copy of which is filed as Exhibit 10.3 to
this Current Report on Form 8-K and is incorporated herein by
reference.

Intercreditor Agreement

On June23, 2017, the Company entered into an Intercreditor
Agreement between Wells Fargo Bank, N.A., in its capacity as
administrative agent (the Securitization
Agent) under the Receivables Agreements, andBank of
America, N.A., in its capacity as administrative agent (the
Bank Agent) under the Credit Agreement
(the Intercreditor Agreement). The
Intercreditor Agreement governs the relationship between the
Securitization Agent and the Bank Agent and their rights and
duties with respect to certain collateral of the respective
parties.

The foregoing description of the Intercreditor Agreement does not
purport to be complete and is qualified in its entirety by
reference to the Intercreditor Agreement, a copy of which is
filed as Exhibit 10.4 to this Current Report on Form 8-K and is
incorporated herein by reference.

Section2 Financial Information

Item2.03 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 herein by reference.

Section8 Other Events

Unaudited pro forma condensed consolidated financial information
of the Company to show the effects of the sale of CMC Cometals
and other probable dispositions of the Other MD Entities is
attached hereto as Exhibit 99.1 and is incorporated herein by
reference.

The unaudited pro forma condensed consolidated financial
information gives effect to certain pro forma events described
therein and has been presented for informational purposes only.
It does not purport to project the future financial position or
operating results of the Company.

Section9 Financial Statements and
Exhibits

(b) Pro Forma Financial Information.

The following unaudited pro forma condensed consolidated
financial information of the Company to show the effects of the
sale of CMC Cometals and other probable dispositions of the Other
MD Entities is attached hereto as Exhibit 99.1 and is
incorporated herein by reference:

(d) Exhibits.

COMMERCIAL METALS CO Exhibit
EX-10.1 2 d407881dex101.htm EX-10.1 EX-10.1 Exhibit 10.1 SECOND AMENDMENT TO FOURTH AMENDED AND RESTATED CREDIT AGREEMENT This SECOND AMENDMENT TO FOURTH AMENDED AND RESTATED CREDIT AGREEMENT,…
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About Commercial Metals Company (NYSE:CMC)

Commercial Metals Company, together with its subsidiaries, manufactures, recycles and markets steel and metal products, related materials and services through a network. The Company’s Americas Recycling segment processes scrap metals for use as a raw material by manufacturers of new metal products. The Americas Mills segment consists of steel mills, commonly referred to as minimills that produce reinforcing bar (rebar), angles, flats and rounds. Its Americas Fabrication segment consists of its steel fabrication facilities that bend, weld, cut and fabricate steel, primarily rebar. Its International Mill segment consists of its mill, recycling and fabrication operations located in Poland. Its International Marketing and Distribution segment includes international operations for the sales, distribution and processing of primary and secondary metals, fabricated metals, semi-finished, long and flat steel products, and other industrial products.