Item 1.01. Entry into a Material Definitive Agreement.
On June 22, 2021, International Business Machines Corporation ("IBM") (i)
entered into a new $2.5 billion Three-Year Credit Agreement (the "New Three-Year
Credit Agreement") with the several banks and other financial institutions from
time to time party thereto (the "Three-Year Lenders") and (ii) entered into a
new $7.5 billion Five-Year Credit Agreement (the "New Five-Year Credit
Agreement" and, together with the Three-Year Credit Agreement, the "New Credit
Agreements") with the several banks and other financial institutions from time
to time party thereto (the "Five-Year Lenders" and, together with the Three-Year
Lenders, the "Lenders").
The New Three-Year Credit Agreement replaces IBM's existing Amended and Restated
Three-Year Credit Agreement, dated as of July 19, 2018 (as amended, supplemented
or otherwise modified from time to time, the "Existing Three-Year Credit
Agreement"), among IBM, the several banks and other financial institutions from
time to time parties thereto, JPMorgan Chase Bank, N.A., as Administrative
Agent, BNP Paribas, Citibank, N.A., Royal Bank of Canada and Mizuho Bank, Ltd.,
as Syndication Agents, and the Documentation Agents named therein. The New
Three-Year Credit Agreement expires, unless extended, on June 21, 2024, and the
Existing Three-Year Credit Agreement was scheduled to expire on July 20, 2023.
The New Five-Year Credit Agreement replaces IBM's existing Amended and Restated
Five-Year Credit Agreement, dated as of July 19, 2018 (as amended, supplemented
or otherwise modified from time to time, the "Existing Five-Year Credit
Agreement"), among IBM, the Subsidiary Borrowers (as defined in the Existing
Five-Year Credit Agreement) parties thereto, the several banks and other
financial institutions from time to time parties thereto, JPMorgan Chase Bank,
N.A., as Administrative Agent, BNP Paribas, Citibank, N.A., Royal Bank of Canada
and Mizuho Bank, Ltd., as Syndication Agents, and the Documentation Agents named
therein. The New Five-Year Credit Agreement expires, unless extended, on June
22, 2026, and the Existing Five-Year Credit Agreement was scheduled to expire on
July 20, 2024.
Also on June 22, 2021, in connection with entering into the New Credit
Agreements, IBM terminated the revolving credit commitments under the 364-Day
Credit Agreement, dated as of July 2, 2020 (as amended, supplemented or
otherwise modified from time to time, the "Existing 364-Day Credit Agreement"),
among IBM, the several banks and other financial institutions from time to time
parties thereto, JP Morgan Chase Bank, N.A., as Administrative Agent, BNP
Paribas, Citibank N.A., Royal Bank of Canada and Mizuho Bank, Ltd., as
Syndication Agents, and the Documentation Agents named therein. The Existing
364-Day Credit Agreement was scheduled to expire on July 1, 2021.
The New Credit Agreements permit IBM and its Subsidiary Borrowers (if any) to
borrow up to an aggregate of $10.0 billion on a revolving basis. Borrowings of
any Subsidiary Borrowers will be unconditionally guaranteed by IBM under each of
the New Credit Agreements. Subject to certain conditions stated in each New
Credit Agreement, IBM and the Subsidiary Borrowers may borrow, prepay and
re-borrow amounts under each New Credit Agreement at any time during the term of
the applicable New Credit Agreement. Funds borrowed may be used for the general
corporate purposes of IBM and its subsidiaries. Interest rates on borrowings
under the New Credit Agreements will be based on prevailing market rates, plus a
margin, as further described in the New Credit Agreements. The New Credit
Agreements contain customary representations and warranties, covenants, events
of default and indemnification provisions. This summary description of the New
Credit Agreements does not purport to be complete and is qualified in its
entirety by reference to the full text of the New Credit Agreements, which are
filed as Exhibits 10.1 and 10.2 to this report, and are incorporated by
reference herein.
In the ordinary course of their respective businesses, the Lenders and their
affiliates have engaged, and may in the future engage, in commercial banking,
investment banking, financial advisory or other services with IBM and/or its
subsidiaries for which they have in the past and/or may in the future receive
customary compensation and expense reimbursement.
Item 1.02. Termination of a Material Definitive Agreement.
The information set forth in Item 1.01 of this Current Report on Form 8-K is
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 in Item 1.01 of this Current Report on Form 8-K is
incorporated by reference herein.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. Description
10.1 $2,500,000,000 Three-Year Credit Agreement, dated as of June 22,
2021, among International Business Machines Corporation, the Subsidiary
Borrowers parties thereto, the several banks and other financial
institutions from time to time parties to such agreement, JPMorgan
Chase Bank, N.A., as Administrative Agent, BNP Paribas, Citibank N.A.
and Royal Bank of Canada, as Syndication Agents, and the Documentation
Agents named therein.
10.2 $7,500,000,000 Five-Year Credit Agreement, dated as of June 22, 2021,
among International Business Machines Corporation, the Subsidiary
Borrowers parties thereto, the several banks and other financial
institutions from time to time parties to such agreement, JPMorgan
Chase Bank, N.A., as Administrative Agent, BNP Paribas, Citibank, N.A.
and Royal Bank of Canada, as Syndication Agents, and the Documentation
Agents named therein.
104 Cover Page Interactive Data File (embedded within the Inline XBRL
Document)
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