8-KMaterial AgreementsFinancial EventsOther Events+1

AGILENT TECHNOLOGIES, INC. 8-K Report, Material Agreement (Oct 26, 2007)

Filed October 26, 2007For Securities:A

Summary

Agilent Technologies, Inc. (Agilent) has filed an 8-K report detailing a significant financing transaction. On October 24, 2007, the company entered into an underwriting agreement for the public offering and sale of $600 million in aggregate principal amount of 6.50% Senior Notes due 2017. This offering aims to raise substantial capital, with the notes priced at 99.60% of their principal amount and maturing in ten years. These notes are unsecured and rank equally with other senior unsecured indebtedness. The company has included provisions for redemption at its option and a specific repurchase obligation triggered by a change of control event that results in the notes falling below investment grade ratings. The company also plans to enter into interest rate swaps to convert the fixed interest expense of these notes to a variable, LIBOR-based rate, indicating a strategy to manage interest rate risk.

Key Highlights

  • 1Agilent Technologies priced a public offering of $600 million in 6.50% Senior Notes due 2017.
  • 2The notes were issued at 99.60% of their principal amount.
  • 3The offering is underwritten by Citigroup Global Markets Inc. and J.P. Morgan Securities Inc.
  • 4The notes are redeemable at Agilent's option and include a change of control repurchase provision.
  • 5The company intends to enter into interest rate swaps to convert fixed-rate debt to variable (LIBOR-based) interest expense.
  • 6The Indenture includes covenants that limit the company's ability to grant liens and enter into sale and lease-back transactions.
  • 7Events of default include failure to pay principal or interest, bankruptcy, and significant defaults on other indebtedness exceeding $100 million.

Frequently Asked Questions

This 8-K filing announces Agilent Technologies, Inc.'s entry into a material definitive agreement related to the issuance and sale of $600 million of its 6.50% Senior Notes due 2017.

The Senior Notes have a principal amount of $600 million, mature on November 1, 2017, and bear a fixed interest rate of 6.50% per annum, payable semi-annually. They are unsecured and rank equally with other senior unsecured debt. They were issued at 99.60% of their principal amount.

Agilent plans to enter into interest rate swaps upon closing the offering. These swaps will convert the fixed 6.50% interest expense on the notes to a variable rate based on LIBOR, effectively hedging against potential increases in interest rates.

Yes, the company is required to make an offer to repurchase the notes at 101% of their principal amount plus accrued interest if a 'Change of Control' occurs that results in the notes being rated below investment grade by Fitch, Moody's, or S&P.