Item 1.01. Entry into a Material Definitive Agreement.
Amended and Restated Credit Agreement
On September 9, 2021, Arrow Electronics, Inc. (the "Company") and certain of the
Company's subsidiaries, as borrowers, entered into a Fourth Amended and Restated
Credit Agreement with the lenders from time to time parties thereto, and
JPMorgan Chase Bank, N.A., as administrative agent (the "Credit Agreement"),
which amends the Company's existing credit facility dated as of December 14,
2018 (the "Previous Credit Agreement"). The Credit Agreement provides for
extensions of credit in the aggregate amount of up to $2,000,000,000 consisting
of revolving credit facilities and letters of credit.
The Credit Agreement's terms are substantially similar to the Previous Credit
Agreement, but for the following: extension of the maturity date to September 9,
2026; change in pricing; addition of LIBOR replacement language; provision of
zero floor for interest rate indexes; deletion of a financial covenant relating
to minimum interest coverage ratio; and increase in thresholds in certain
representations and covenants to reflect increases in assets of the Company and
Interest and fees under the Credit Agreement will generally be payable at least
on a quarterly basis and the applicable margins and fees are determined based on
the actual or implied senior unsecured debt ratings of the Company in effect
from time to time by Moody's Investors Service, Inc., Standard & Poor's Ratings
Group or Fitch Ratings, Inc. Interest on borrowings under the Credit Agreement
is calculated using a base rate or a Eurocurrency rate plus the applicable
margin, which ranges from 0.900% to 1.600% for Eurocurrency loans and 0.000% to
0.600% for base rate loans.
The Company and certain of its U.S. and non-U.S. subsidiaries may be borrowers
under the Credit Agreement. Loans may be made, and letters of credit may be
issued, under the Credit Agreement in U.S. Dollars, British Pounds Sterling,
Euros and other specified currencies. The Company's obligations are guaranteed
by certain of the Company's domestic subsidiaries. The obligations of any
subsidiary borrowers are guaranteed by the Company.
The Credit Agreement contains a number of covenants, including, among other
things, the requirement to comply with a consolidated leverage ratio test;
restrictions on the Company's and certain of its subsidiaries' ability to incur
liens, merge or consolidate with other companies; restrictions on the ability to
make certain acquisitions; and restrictions on the ability of the Company's
subsidiaries to incur indebtedness.
The maturity date of the Credit Agreement may be accelerated upon the occurrence
and during the continuation of an event of default. Events of default under the
Credit Agreement include the failure to pay principal or interest when due; a
material breach of any representation or warranty; covenant defaults; bankruptcy
or insolvency related events of the Company or certain subsidiaries; imposition
of certain judgments against the Company or any of its subsidiaries; certain
events relating to the Employee Retirement Income Security Act of 1974 (as
amended); a change in control (with respect to the Company's board of directors
or the ownership of the Company's shares); impairment of loan documentation or
any guarantees related to the Credit Agreement; and cross-defaults to certain
other indebtedness, guarantee obligations or permitted receivables
securitizations of the Company or any of its consolidated subsidiaries.
The foregoing description does not purport to be complete and is qualified in
its entirety by reference to the full text of the Credit Agreement, filed as
Exhibit 10.1 hereto and incorporated by reference herein.
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 above in Item 1.01 is incorporated by reference into
this Item 2.03.
Item 9.01. Financial Statements and Exhibits.
Exhibit Number Description
10.1 Fourth Amended and Restated Credit Agreement, dated as of September 9,
2021, among Arrow Electronics, Inc. and certain of its subsidiaries, as
borrowers, the lenders from time to time parties thereto, JPMorgan Chase
Bank, N.A. as administrative agent and Bank of America, N.A., The Bank
of Nova Scotia, BNP Paribas, ING Bank N.V., Dublin Branch, MUFG Bank,
Ltd., Mizuho Bank, Ltd., and Sumitomo Mitsui Banking Corporation as
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