8-KMaterial AgreementsFinancial EventsExhibits & Filings

BROWN & BROWN, INC. 8-K Report, Material Agreement (Mar 17, 2022)

Filed March 17, 2022For Securities:BRO

Summary

Brown & Brown, Inc. (BRO) announced on March 17, 2022, the completion of a significant debt offering, raising $1.2 billion in aggregate principal amount through the issuance of 4.200% Senior Notes due 2032 and 4.950% Senior Notes due 2052. The net proceeds after expenses were approximately $1.178 billion. This offering was conducted under the company's existing Automatic Shelf Registration Statement. The primary stated use of these proceeds is to fund the cash consideration and related expenses for the acquisition of GRP (Jersey) Holdco Limited and its businesses. A crucial detail for investors is the special mandatory redemption provision for the 2032 Notes: if the GRP acquisition does not close by December 31, 2022, or if the acquisition agreement is terminated, these notes must be redeemed at 101% of their principal amount plus accrued interest. The 2052 Notes are not subject to this special redemption and will remain outstanding, with proceeds intended for general corporate purposes if the acquisition does not proceed. The new notes are senior unsecured obligations and rank equally with other existing senior unsecured debt.

Key Highlights

  • 1Completed issuance of $600 million in 4.200% Senior Notes due 2032 and $600 million in 4.950% Senior Notes due 2052, totaling $1.2 billion in aggregate principal.
  • 2Net proceeds from the offering approximated $1.178 billion.
  • 3Proceeds are primarily earmarked for the acquisition of GRP (Jersey) Holdco Limited and related expenses.
  • 4The 2032 Notes are subject to a special mandatory redemption at 101% if the GRP acquisition does not close by December 31, 2022, or is terminated.
  • 5The 2052 Notes are not subject to this special mandatory redemption and proceeds will be used for general corporate purposes if the GRP acquisition is not consummated.
  • 6The Notes are senior unsecured obligations, ranking pari passu with existing and future senior unsecured indebtedness.
  • 7The Indenture includes restrictive covenants related to secured debt, asset transfers, and a repurchase obligation upon a 'change of control triggering event'.

Frequently Asked Questions

The primary purpose of this debt issuance is to fund the cash consideration and associated fees and expenses for the proposed acquisition of GRP (Jersey) Holdco Limited and its businesses.

If the GRP acquisition does not close by December 31, 2022, or if the acquisition agreement is terminated prior to that date, the 4.200% Senior Notes due 2032 must be redeemed at a price of 101% of their principal amount, plus accrued interest. The 4.950% Senior Notes due 2052 are not subject to this special mandatory redemption and will remain outstanding, with their proceeds then intended for general corporate purposes.

Brown & Brown, Inc. raised a total of $1.2 billion in aggregate principal amount. This consists of $600 million of 4.200% Senior Notes due 2032 and $600 million of 4.950% Senior Notes due 2052.

The newly issued 2032 and 2052 Notes are senior unsecured obligations of Brown & Brown, Inc. This means they rank equally in right of payment with all of the company's existing and future senior unsecured indebtedness.