Summary
This 8-K filing from Arthur J. Gallagher & Co. (AJG) reports on the successful closing of a private placement of $275 million in aggregate principal amount of unsecured senior notes on June 2, 2016. These notes are structured into three series with varying interest rates and maturity dates: $175 million of 4.40% Series Q Senior Notes due 2026, $75 million of 4.55% Series R Senior Notes due in 2028, and $25 million of 4.70% Series S Senior Notes due in 2031. The issuance was made through a Note Purchase Agreement with accredited institutional investors. These notes represent senior unsecured obligations of Gallagher and its subsidiary obligors, ranking equally with existing senior unsecured indebtedness. The filing outlines customary provisions within the Purchase Agreement, including representations, warranties, and covenants that require AJG to maintain specific financial ratios. It also details standard events of default and redemption terms, including a provision requiring a prepayment offer if a change in control occurs and the company's debt does not maintain an investment grade rating within 90 days.
Key Highlights
- 1AJG closed a private placement of $275 million in unsecured senior notes.
- 2The notes are issued in three series: 4.40% due 2026 ($175M), 4.55% due 2028 ($75M), and 4.70% due 2031 ($25M).
- 3Interest payments are semi-annual, commencing December 2, 2016.
- 4The notes are senior unsecured obligations, ranking equally with other senior unsecured debt.
- 5The Note Purchase Agreement includes customary covenants, financial ratio requirements, and events of default.
- 6A 'make-whole' provision exists for early redemption, along with a specific prepayment obligation upon a change in control if the company's debt rating falls below investment grade within 90 days.