01—Abstract
Summary
Summary of the 8-K filed July 18, 2024. Cited figures are marked; the original filing is the authoritative source.
Waters Corporation entered into a Master Note Facility Agreement dated July 12, 2024 with NYL Investors LLC and its affiliates (the Note Purchasers).
Under the agreement, Waters may, at its option, authorize the issuance of senior promissory notes (Shelf Notes) up to an aggregate principal amount of $200,000,000a. Purchases are at NYL's sole discretion. Shelf Notes may be issued until the earliest of February 9, 2026, a termination notice given by either party with thirty days' effect, or acceleration of a Shelf Note.
Each note matures no more than 15 years after issuance and bears interest at a rate specified in that note. Obligations would be guaranteed by the guarantors listed on Schedule C, and proceeds could fund general corporate purposes, including debt repayment or refinancing, share repurchases, capital expenditures and acquisitions. The agreement contains customary representations, affirmative and negative covenants, and events of default.
Financial covenants require the Leverage Ratio to not exceed 3.50:1.00 at any fiscal quarter-end, with an option to rise to 4.00 to 1.00 following certain material acquisitions, subject to further adjustment and an incremental interest payment. The Interest Coverage Ratio over any four consecutive fiscal quarters must be at least 3.50:1.00. Waters may prepay all or part (minimum 10%b) of any series of Shelf Notes subject to a make-whole amount.
A most favored lender provision automatically adds any additional financial covenants the company agrees to under its Primary Credit Agreement. The filing is a notice of a financing arrangement rather than a completed issuance. It states no amount has been issued under the facility, and it reports no related financial results.
02—Key points
Key Highlights
- Entered a Master Note Facility Agreement with NYL Investors LLC and affiliates on July 12, 2024, establishing a framework for senior promissory notes.
- Up to $200,000,000 in aggregate principal of Shelf Notes may be issued, with each purchase at NYL's sole discretion.
- Issuance window ends on the earliest of February 9, 2026, thirty days after a termination notice, or acceleration of a Shelf Note.
- Shelf Notes mature within 15 years of issuance, with interest rates set in each note, and are guaranteed by the Schedule C guarantors.
- Leverage Ratio capped at 3.50:1.00 (up to 4.00 to 1.00 after certain material acquisitions) and Interest Coverage Ratio must be at least 3.50:1.00.
- Prepayment is permitted in amounts of at least 10% of a series, subject to a make-whole amount, and a most favored lender clause automatically incorporates any additional financial covenants from the Primary Credit Agreement.
- Proceeds may be used for general corporate purposes, including debt refinancing, share repurchases, capital expenditures and acquisitions.
03—Questions
Frequently Asked Questions
How much financing does the Master Note Facility Agreement allow Waters to raise?
The facility allows Waters, at its option, to authorize Shelf Notes up to an aggregate principal amount of $200,000,000. Each purchase is at the sole discretion of NYL Investors LLC.
When does the ability to issue Shelf Notes expire?
Issuance ends on the earliest of February 9, 2026, the thirtieth day after either party gives written notice terminating issuance, or the acceleration of any Shelf Note.
What financial covenants must Waters maintain under the agreement?
The Leverage Ratio must not exceed 3.50:1.00 at any fiscal quarter-end, or 4.00 to 1.00 if Waters elects this after certain material acquisitions, subject to further adjustment and an incremental interest payment. The Interest Coverage Ratio over any four consecutive fiscal quarters must be at least 3.50:1.00.
Can Waters repay the notes early, and what does that cost?
Waters may prepay all or part of any series of Shelf Notes, with a minimum partial prepayment of 10% of the outstanding principal, but must pay a make-whole amount.
How will the proceeds of any Shelf Notes be used?
The filing states proceeds would be permitted for general corporate purposes of the company and its subsidiaries, including repaying or refinancing indebtedness, repurchasing Waters stock, capital expenditures and acquisitions.
04—Continue