8-KMaterial AgreementsFinancial EventsExhibits & Filings

CASEYS GENERAL STORES INC 8-K Report, Material Agreement (May 3, 2016)

Filed May 3, 2016For Securities:CASY

Summary

On May 2, 2016, Casey's General Stores, Inc. (CASY) announced a significant financing event through a Note Purchase Agreement, securing $100 million in senior notes. This issuance is structured into two tranches: $50 million in Series C Notes due May 2, 2031, bearing a 3.65% interest rate, and $50 million in Series D Notes due October 28, 2031, with a 3.72% interest rate. The proceeds are earmarked for strategic growth initiatives, including store constructions, remodels, and acquisitions, as well as general working capital needs. This debt issuance, while providing capital for expansion, also introduces long-term obligations and financial covenants. The agreement includes mandatory principal prepayments over several years and outlines conditions for optional prepayments, including a 'Make-Whole Amount' for early retirement. Investors should note the covenants related to indebtedness, fixed charge coverage, and net worth, as well as provisions for mandatory repurchase upon a 'Change of Control' event. The report details potential 'Events of Default' that could accelerate the repayment of the entire principal and interest.

Key Highlights

  • 1Casey's General Stores issued $100 million in aggregate principal amount of Senior Notes.
  • 2The issuance comprises $50 million in 3.65% Senior Notes, Series C, maturing May 2, 2031.
  • 3The issuance also comprises $50 million in 3.72% Senior Notes, Series D, maturing October 28, 2031.
  • 4Proceeds will be used for store construction, remodels, acquisitions, and working capital.
  • 5The Note Agreement includes mandatory principal prepayments scheduled between 2025 and 2030.
  • 6Optional prepayments are permitted, subject to a 'Make-Whole Amount'.
  • 7The agreement contains financial covenants including maximum indebtedness to EBITDA, minimum fixed charge coverage, and minimum net worth, as well as negative covenants restricting debt, liens, and asset sales.

Frequently Asked Questions

Casey's General Stores has raised $100,000,000 in aggregate principal amount through the issuance of Senior Notes.

The company intends to use the proceeds for store constructions, remodels, acquisitions, and other working capital purposes.

The Series C Notes total $50 million with a 3.65% interest rate, maturing on May 2, 2031. The Series D Notes total $50 million with a 3.72% interest rate, maturing on October 28, 2031. The Series C Notes were issued on May 2, 2016, while the Series D Notes will be issued on October 28, 2016.

The notes have mandatory principal prepayments and allow for optional prepayments with a 'Make-Whole Amount'. The company is also subject to financial covenants such as a maximum indebtedness to EBITDA ratio, a minimum fixed charge coverage ratio, and a minimum consolidated net worth. Negative covenants restrict consolidated total debt, priority debt, liens, mergers, and asset sales.