On December 4, 2020, Thermo Fisher Scientific Inc. (the "Company") reported that replaced its existing $2.5 billion unsecured five-year revolving credit facility with a new $3.0 billion unsecured five-year revolving credit facility (the "Credit Facility") pursuant to a Credit Agreement (the "Credit Agreement"), among the Company, certain Subsidiaries of the Company from time to time party thereto as Designated Borrowers, Bank of America, N.A., as Administrative Agent and a syndicate of lenders from time to time party thereto (Filing, 8-K, Thermo Fisher Scientific, DEC 4, 2020, View Source [SID1234572171]). Capitalized terms used in this Form 8-K and not defined herein shall have the meanings ascribed to them in the Credit Agreement, which is attached to this Form 8-K as Exhibit 10.1.
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The Credit Facility expires December 4, 2025, subject to two one-year extensions at the request of the Company and with the consent of the lenders. The Credit Facility also contains an expansion option permitting the Company to request increases of up to an aggregate additional $1.0 billion from lenders that elect to make such increase available, upon the satisfaction of certain conditions. The proceeds of the Loans under the Credit Facility may be used for working capital purposes, capital expenditures, acquisitions, repurchases of stock, debentures and other securities, the refinancing of present and future debt and other general corporate purposes. If no Default or Event of Default has occurred, (i) each Eurocurrency Rate Loan and each Swing Line Loan denominated in Euros shall bear interest on the outstanding principal amount thereof for each Interest Period at a variable rate per annum equal to the Eurocurrency Rate for such Interest Period plus a margin of 1.025% to 1.600% based on the Company’s long-term debt credit ratings and (ii) each Base Rate Committed Loan and each Swing Line Loan denominated in Dollars shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a variable rate per annum equal to the Base Rate plus a margin of 0.025% to 0.600% based on the Company’s long-term debt credit rating. In addition, the Company has agreed to pay a facility fee equal to a variable rate between 0.100% and 0.275% per year based on the Company’s long-term debt credit rating times the actual daily amount of the Commitments, regardless of usage, quarterly in arrears on the last business day of each March, June, September and December, commencing with the first such date to occur after the Closing Date.
The Company has unconditionally and irrevocably guaranteed the obligations of each of its subsidiaries in the event a subsidiary is named a borrower under the Credit Facility. The Credit Agreement contains customary conditions precedent, representations and warranties, affirmative and negative covenants, events of default and indemnities. The negative covenants include restrictions on liens and fundamental changes. These covenants are subject to a number of important exceptions and qualifications. The Credit Agreement also requires a minimum consolidated net interest coverage ratio of 3.5 to 1.0 as at the last day of any fiscal quarter. Certain changes of control with respect to the Company would constitute an event of default under the Credit Facility. Upon the occurrence and during the continuance of an event of default, the lenders may declare the outstanding advances and all other obligations under the Credit Facility immediately due and payable. Borrowings under the Credit Facility are prepayable at the Company’s option in whole or in part without premium or penalty.
The foregoing description of the Credit Agreement does not purport to be a complete statement of the parties’ rights under such agreement and is qualified in its entirety by reference to the full text of the Credit Agreement (including exhibits), which is filed as Exhibit 10.1 and incorporated by reference herein.
In the ordinary course of business, certain of the lenders under the Credit Agreement and their affiliates have provided, and may in the future provide, investment banking, commercial banking, cash management, foreign exchange or other financial services to the Company for which they have received compensation and may receive compensation in the future.