8-KMaterial AgreementsFinancial EventsExhibits & Filings

Aon plc 8-K Report, Material Agreement (Aug 27, 2010)

Filed August 27, 2010For Securities:AON

Summary

This 8-K filing by Aon plc (AON) on August 27, 2010, primarily details an amendment to its European Credit Agreement. The amendment, dated August 26, 2010, was entered into with Citibank International plc as agent and aims to align the European facility with existing and anticipated financing arrangements. Specifically, it modifies provisions to accommodate a new $1.0 billion Term Loan Facility and a $1.5 billion Bridge Facility, which were previously disclosed and are intended to support Aon's acquisition of Hewitt Associates, Inc. The core purpose of this amendment is to ensure financial flexibility and regulatory compliance in light of the significant corporate transaction. Key adjustments include allowing for add-backs to consolidated EBITDA for merger-related fees and expenses, accommodating restrictions from existing Hewitt indebtedness, and modifying leverage ratios to account for potential senior note issuances prior to the merger's completion. This filing provides important updates on the financing structure supporting Aon's strategic growth initiatives, particularly the substantial Hewitt acquisition.

Key Highlights

  • 1Aon plc amended its European Credit Agreement on August 26, 2010.
  • 2The amendment is designed to conform the European facility with Aon's existing $1.0 billion Term Loan Facility and $1.5 billion Bridge Facility.
  • 3These facilities are intended to support the financing of Aon's acquisition of Hewitt Associates, Inc.
  • 4Key modifications include allowing for EBITDA add-backs related to merger expenses and adjusting leverage ratios for potential senior note issuance.
  • 5The amendment addresses restrictions from existing Hewitt indebtedness.
  • 6The filing clarifies the financial arrangements supporting Aon's strategic merger activities.

Frequently Asked Questions

The main purpose of the amendment is to align Aon's European Credit Agreement with the financing structures in place to support the acquisition of Hewitt Associates, Inc. This includes making the agreement consistent with the recently established Term Loan Facility and Bridge Facility.

The amendment allows for certain financial adjustments necessary for the merger, such as permitting add-backs to consolidated EBITDA for fees and expenses related to the merger. It also modifies financial covenants, like the leverage ratio, to accommodate the financing structure, including potential senior note issuances before the merger closes.

The amendment allows for add-backs to consolidated EBITDA for fees and expenses related to the Hewitt merger (subject to caps), permits restrictions set forth in existing Hewitt indebtedness, and modifies the maximum consolidated leverage ratio to adjust for potential senior note issuances prior to the merger's consummation.

No, this filing is an amendment to an existing agreement (the European Credit Agreement). The new debt facilities mentioned, the $1.0 billion Term Loan Facility and $1.5 billion Bridge Facility, were entered into previously and their details were disclosed in an August 16, 2010 8-K filing. This amendment ensures the European facility is compatible with those.