8-KMaterial AgreementsFinancial EventsExhibits & Filings

CHURCH & DWIGHT CO INC /DE/ 8-K Report, Material Agreement (Mar 30, 2018)

Filed March 30, 2018For Securities:CHD

Summary

Church & Dwight Co., Inc. (CHD) has entered into a new $1.0 billion unsecured revolving credit facility, replacing its prior $1.0 billion facility. This new agreement, effective March 29, 2018, has a maturity date of March 29, 2023, and offers the flexibility to increase the facility size by an additional $600 million under certain conditions. The facility provides access to capital with interest rates tied to LIBOR or a Base Rate, plus an applicable margin based on the company's corporate credit rating, along with customary fees. The new credit agreement includes standard covenants, such as restrictions on liens, investments, and subsidiary debt, and importantly, requires the company to maintain a leverage ratio (Consolidated Funded Indebtedness to EBITDA) no greater than 3.75 to 1.00, with an allowance to increase to 4.25 to 1.00 following material acquisitions. The termination of the previous credit agreement and the repayment of all outstanding amounts signify a refinancing aimed at maintaining financial flexibility and optimizing the company's capital structure.

Key Highlights

  • 1Execution of a new $1.0 billion unsecured revolving credit facility, maturing on March 29, 2023.
  • 2The new facility replaces a prior $1.0 billion credit facility.
  • 3Capacity to increase the credit facility by up to an additional $600 million, subject to lender commitments.
  • 4Interest rates are based on adjusted LIBOR or a Base Rate, plus a margin tied to the company's credit rating.
  • 5Includes customary covenants and events of default, with a key leverage ratio maintenance requirement of 3.75:1.00 (or 4.25:1.00 post-acquisition).
  • 6The previous $1.0 billion credit agreement dated December 4, 2015, has been terminated.
  • 7All outstanding amounts under the prior agreement were repaid upon termination.

Frequently Asked Questions

The primary purpose of this 8-K filing is to announce Church & Dwight Co., Inc.'s entry into a new $1.0 billion unsecured revolving credit facility and the termination of its previous credit agreement. This provides investors with information about the company's financing arrangements and liquidity.

The new credit facility is for $1.0 billion, unsecured, and matures on March 29, 2023. It allows for potential increases of up to $600 million. Interest rates are variable, linked to LIBOR or a Base Rate, with an additional margin based on the company's credit rating. Standard fees and covenants apply.

The new credit agreement includes a leverage ratio covenant, requiring Consolidated Funded Indebtedness to EBITDA to be no greater than 3.75 to 1.00. This ratio can temporarily increase to 4.25 to 1.00 following material acquisitions. This covenant is crucial for maintaining financial discipline and demonstrating solvency to lenders.

The previous $1.0 billion unsecured revolving credit facility, dated December 4, 2015, was terminated concurrently with the entry into the new agreement. All outstanding amounts under the old facility were repaid.