Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
On December 13, 2018, AMETEK, Inc. (the “Company”) entered into a Note Purchase Agreement pursuant to which the Company will issue and sell, in a private placement, $575,000,000 and €75,000,000 aggregate principal amount of the Company’s Senior Notes in five series. The Senior Notes will be issued on two funding dates. The first funding occurred on December 13, 2018 for $560,050,000, consisting of €75,000,000 ($85,050,000) in aggregate principal amount of 1.71% Senior Notes due December 2027, $275,000,000 in aggregate principal amount of 4.18% Senior Notes due December 2025, $150,000,000 in aggregate principal amount of 4.32% Senior Notes due December 2027 and $50,000,000 in aggregate principal amount of 4.37% Senior Notes due December 2028. The second funding date will be January 14, 2019 for $100,000,000 in aggregate principal amount of 4.32% Senior Notes due December 2027. The proceeds from the Senior Notes will be used to provide capital to support our growth strategies and repay existing debt.
The Senior Notes are subject to certain customary covenants, including limitations on the Company and its subsidiaries ability, with significant exceptions, to engage in mergers, consolidations, asset sales, and transactions with affiliates, or to incur priority debt or liens. The Note Purchase Agreement also contains financial covenants that, among other things, require the Company to maintain a consolidated debt to EBITDA ratio of not more than 3.5 to 1.0 and an interest coverage ratio of not less than 2.5 to 1.0 for any period of four consecutive fiscal quarters. Upon the occurrence of certain events of default, all of the Senior Notes will be immediately due and payable, and upon the occurrence of certain other events of default all of the Senior Notes may be declared immediately due and payable. The Company may redeem the Senior Notes upon the satisfaction of certain conditions and the payment of a make-whole amount to noteholders, and is required to offer to repurchase the Senior Notes at par following certain events, including a change of control.
Interest on the December 2025, 2027 and 2028 Senior Notes is payable semiannually on June 13 and December 13 commencing June 13, 2019. Interest on the above mentioned Senior Notes will be computed on the basis of a 360-day year consisting of twelve 30-day months.
The foregoing summary of the Senior Notes is qualified in its entirety by reference to the full text of the Note Purchase Agreement, a copy of which is filed herewith as Exhibit 10.1 and incorporated by reference herein.
A copy of the news release issued by the Company on December 17, 2018 announcing Note Purchase Agreement is filed as Exhibit 99.1 to this Form 8-K.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
