HAEMONETICS CORPORATION (NYSE:HAE) Files An 8-K Entry into a Material Definitive AgreementItem 1.01Entry Into a Material Definitive Agreement
On June 15, 2018, Haemonetics Corporation (the “Company”) entered into a new credit agreement by and among the Company, as Borrower, the several Lenders party thereto, Citibank, N.A. and Citizens Bank, N.A., as Co-Syndication Agents, and JPMorgan Chase Bank, N.A., as Administrative Agent (the “2018 Credit Agreement”). The 2018 Credit Agreement refinances the Company’s prior credit agreement, dated as of June 30, 2014, by and among the Company, as Borrower, the several Lenders party thereto, Citibank N.A., as Syndication Agent, and JPMorgan Chase Bank, N.A., as Administrative Agent (the “2014 Credit Facility”).
The 2018 Credit Agreement provides for a $350 million senior unsecured term loan A (the “Term Loan”) and a $350 million senior unsecured revolving credit facility. Loans under the 2018 Credit Agreement will initially bear interest at an annual rate of LIBOR plus 1.25%, which may change based on the Company’s leverage ratio. The revolving credit facility carries an unused fee of 0.175% annually, which may change based on the Company’s leverage ratio. The 2018 Credit Agreement matures on June 15, 2023. The principal amount of the Term Loan is repayable quarterly over five years and amortizes at a rate of 5% during each of the first four years and 80% during the fifth year.
The 2018 Credit Agreement contains covenants which, among other things, require that the Company maintain amaximum leverage ratio of 3.50x or, on up to two occasions during the term of the facility, 4.00x for the four consecutive fiscal quarters ended immediately following the consummation of a Qualifying Material Acquisition (meaning one or more Permitted Acquisition(s) (as defined in the 2018 Credit Agreement) for which the aggregate consideration paid over a 12-month period exceeds $100 million). The ratios are calculated based on earnings before interest, taxes, depreciation and amortization, as adjusted to the 2018 Credit Agreement (“Consolidated EBITDA”). The Company is permitted to exclude from Consolidated EBITDA, among other things, (i) unusual or non-recurring charges or expenses not to exceed the greater of 15% of Consolidated EBITDA or $30 million and (ii) transaction costs related to the closing of Permitted Acquisitions not to exceed $10 million per acquisition. The 2018 Credit Agreement also permits the Company to incur up to $200 million in Indebtedness for Capital Lease Obligations (each as defined in the 2018 Credit Agreement) and places no dollar limits on the Company’s ability to enter into operating leases or (subject to the Company’s compliance with its financial covenants) undertake acquisitions or other Investments (as defined in the 2018 Credit Agreement).
A copy of the 2018 Credit Agreement is attached hereto as Exhibit 10.1 and is incorporated herein by reference. The foregoing description of the 2018 Credit Agreement is qualified in its entirety by reference to the full text of the 2018 Credit Agreement. A copy of the Company’s press release announcing its entry into the 2018 Credit Agreement is filed as Exhibit 99.1 to this Current Report on Form 8-K.
Item 1.02Termination of a Material Definitive Agreement
In connection with the entry into the 2018 Credit Agreement, the Company terminated the 2014 Credit Facility on June 15, 2018.
Item 2.03Creation 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 hereby incorporated by reference into this Item 2.03.
Item 9.01Financial Statement and Exhibits
(d)Exhibits
HAEMONETICS CORP ExhibitEX-10.1 2 creditagreement.htm CREDIT AGREEMENT Exhibit EXECUTION COPY CREDIT AGREEMENTdated as ofJune 15,…To view the full exhibit click here
About HAEMONETICS CORPORATION (NYSE:HAE)
Haemonetics Corporation (Haemonetics) is a healthcare company. The Company provides various products to customers involved in the processing, handling and analysis of blood. The Company’s segments include Japan, EMEA, North America Plasma and All Other. Haemonetics provides plasma collection systems and software, which enable plasma fractionators to make pharmaceuticals. The Company enables plasma collection customers to source from it a range of products necessary for plasma collection and storage, including PCS brand plasma collection equipment and disposables, plasma collection containers and intravenous solutions, such as saline. Haemonetics offers automated blood component and manual whole blood collection systems to blood collection centers to collect blood products. The Company offers a range of blood management solutions. The Company has a suite of integrated software solutions, which include solutions for blood drive planning and blood collection.
