8-KMaterial AgreementsFinancial EventsExhibits & Filings

THERMO FISHER SCIENTIFIC INC. 8-K Report, Material Agreement (Apr 27, 2010)

Filed April 27, 2010For Securities:TMO

Summary

Thermo Fisher Scientific Inc. (TMO) filed an 8-K on April 27, 2010, to report the issuance of $750 million in new senior notes. This offering comprised $450 million of 3.200% Senior Notes due 2015 and $300 million of 4.700% Senior Notes due 2020. The proceeds from this issuance are earmarked for significant debt management activities, including redeeming outstanding Floating Rate Convertible Senior Debentures due 2033 and calling all outstanding 6 1/8% Senior Subordinated Notes due 2015. This strategic move indicates a focus on optimizing the company's capital structure by potentially lowering interest expenses and simplifying its debt profile. The new notes are unsecured general obligations, senior to subordinated debt but effectively subordinated to secured debt and liabilities of subsidiaries. The indenture includes covenants restricting the incurrence of secured debt, sale-leaseback transactions, and asset sales, along with provisions for acceleration of debt upon default and a change of control put option under specific downgrade conditions.

Key Highlights

  • 1Issuance of $450 million in 3.200% Senior Notes due 2015.
  • 2Issuance of $300 million in 4.700% Senior Notes due 2020.
  • 3Total gross proceeds from the note offering expected to be approximately $741.8 million after expenses.
  • 4Use of proceeds includes redemption of Floating Rate Convertible Senior Debentures due 2033 (up to $226.5 million).
  • 5Use of proceeds includes redemption of all outstanding 6 1/8% Senior Subordinated Notes due 2015 on July 1, 2010 (approximately $515.3 million).
  • 6Notes are general unsecured obligations, senior to subordinated debt.
  • 7Indenture contains covenants restricting secured debt, sale-leaseback transactions, and mergers/asset sales.

Frequently Asked Questions

The primary purpose of this 8-K filing was to report Thermo Fisher Scientific's entry into a material definitive agreement related to the issuance of new senior notes and to disclose the creation of these financial obligations.

Thermo Fisher Scientific issued $450 million of 3.200% Senior Notes due 2015 and $300 million of 4.700% Senior Notes due 2020, totaling $750 million in aggregate principal amount. Both notes mature semi-annually, with interest payments starting November 1, 2010.

The company plans to use approximately $226.5 million to redeem or settle outstanding Floating Rate Convertible Senior Debentures due 2033 and approximately $515.3 million to redeem all outstanding 6 1/8% Senior Subordinated Notes due 2015 on July 1, 2010. Any remaining proceeds will be used for general corporate purposes.

The notes are unsecured general obligations. The indenture includes covenants that restrict the company and its subsidiaries from incurring secured debt on principal property, engaging in sale-leaseback transactions, and selling substantially all assets. There are also provisions for redemption at the company's option and a change of control purchase offer if the notes are downgraded following a change of control event.