SYSCO CORPORATION Item 1.01 Entry into Material Definitive Agreement.
New 364-Day Credit Agreement
On
The 364-Day Credit Agreement contains customary terms and conditions for credit
facilities of this type, including, without limitation, affirmative and negative
covenants that (a) restrict (i) the sale of all or substantially all the assets
of Sysco and its subsidiaries and (ii) mergers, consolidations, or amalgamations
of Sysco with another entity where Sysco is not the surviving entity; (b) limit
the incurrence of certain liens; and (c) restrict (i) increases to Sysco's
regular quarterly dividend and (ii) repurchases of equity interests of Sysco, in
each case, until the date on which Sysco has achieved a certain ratio of
consolidated EBITDA to consolidated interest expense. The 364-Day Credit
Agreement contains customary reporting and other covenants, including, without
limitation, a requirement to maintain either a certain level of liquidity or a
certain ratio of consolidated EBITDA to consolidated interest expense, all as
described in the 364-Day Credit Agreement. The 364-Day Credit Agreement also
contains customary events of default, including, without limitation, nonpayment
of obligations under the 364-Day Credit Agreement, violation of covenants in the
364-Day Credit Agreement, and certain bankruptcy or insolvency events. Certain
of the events of default are subject to exceptions, materiality qualifiers,
and/or grace periods customary for credit facilities of this type. Borrowings by
Sysco under the 364-Day Credit Agreement are, in general, guaranteed by those
wholly-owned subsidiaries of Sysco that are guarantors of Sysco's senior notes
and debentures. The 364-Day Credit Agreement also contains a 0.75% interest rate
floor, as well as a mandatory prepayment and corresponding commitment reduction
that is triggered if Sysco or its subsidiaries issue debt in the public markets
(other than by issuance of commercial paper) in excess of
The foregoing description of the 364-Day Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the 364-Day Credit Agreement, which is filed as Exhibit 10.1 hereto and incorporated by reference herein.
Neither Sysco nor any of its affiliates has any material relationship with any of the other parties to the 364-Day Credit Agreement, except for (i) the Company's previous credit facilities, with respect to which certain of the other parties to the 364-Day Credit Agreement (and their respective affiliates) were lenders and (ii) commercial banking, investment banking, underwriting, trust and other financial advisory services provided (or to be provided) to Sysco and its subsidiaries by certain of the lenders under the 364-Day Credit Agreement (and their respective affiliates), for which they have received (or will receive) customary fees and expenses.
Amendment to Existing Credit Agreement
On
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The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Amendment, which is filed as Exhibit 10.2 hereto and incorporated by reference herein.
Neither Sysco nor any of its affiliates has any material relationship with any of the other parties to the Existing Credit Agreement, except for (i) the Company's previous credit facilities, with respect to which certain of the other parties to the Existing Credit Agreement (and their respective affiliates) were lenders and (ii) commercial banking, investment banking, underwriting, trust and other financial advisory services provided (or to be provided) to Sysco and its subsidiaries by certain of the lenders under the Existing Credit Agreement (and their respective affiliates), for which they have received (or will receive) customary fees and expenses.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The information included in Item 1.01 of this report is incorporated herein by reference.
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Item 9.01 Financial Statements and Exhibits.
(a) Financial Statements of Businesses Acquired.
Not applicable.
(b) Pro Forma Financial Information.
Not applicable.
(c) Shell Company Transactions.
Not applicable. (d) Exhibits. Exhibit Number Description 10.1 Credit Agreement dated as ofMay 20, 2020 , amongSysco Corporation , the subsidiary guarantors party thereto,Bank of America, N.A ., as administrative agent,Deutsche Bank Securities, Inc. ,Goldman Sachs Bank (USA) , The Toronto-Dominion Bank,New York Branch, andWells Fargo Bank, National Association , as syndication agents, andBofA Securities, Inc. ,Deutsche Bank Securities, Inc. ,Goldman Sachs Bank (USA) ,TD Securities (USA) LLC , andWells Fargo Bank, National Association , as joint bookrunners and lead arrangers, and the lenders party thereto 10.2 Amendment dated as ofMay 20, 2020 to Credit Agreement dated as ofJune 28, 2019 , amongSysco Corporation ,Sysco Canada, Inc. , Sysco EU II S.à r.l., the subsidiary guarantors party thereto,JP Morgan Chase Bank, N.A. , as administrative agent, and the lenders party thereto 104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
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