On August 2, 2022, Moody’s Corporation (the “Company”) entered into an underwriting agreement by and among the Company and BofA Securities, Inc., Citigroup Global Markets Inc. and J.P. Morgan Securities LLC, as representatives of the several underwriters named therein (the “Underwriting Agreement”), with respect to the issuance and sale of $500 million aggregate principal amount of the Company’s 4.250% Senior Notes due 2032 (the “notes”). The offer of the notes was registered under the Company’s Registration Statement on Form S-3 (Registration No. 333-236611) (the “Registration Statement”) filed with the Securities and Exchange Commission (the “Commission”) on February 25, 2020. On August 8, 2022, the Company closed its public offering of the notes.
The notes were issued under an Indenture between the Company and Computershare Trust Company, N.A. as successor to Wells Fargo Bank, National Association, as trustee (the “Trustee”), dated as of August 19, 2010 (the “Base Indenture”), as supplemented by the seventeenth supplemental indenture, dated as of August 8, 2022 (the “Seventeenth Supplemental Indenture” and, together with the Base Indenture, the “Indenture”). The Seventeenth Supplemental Indenture includes the form of the notes. Concurrently with the offering of the notes, the Company commenced a cash tender offer (the “Tender Offer”) to purchase for cash any and all of the Company’s dollar denominated 2.625% senior notes due January 15, 2023 (the “2023 Notes”), of which $500 million is currently outstanding. The net proceeds of the offering of the notes are expected to be used, together with cash on hand, to fund the purchase of all of the 2023 Notes accepted in the Tender Offer, and to redeem any 2023 Notes that remain outstanding after the Tender Offer (the “2023 Notes Redemption”), including the payment of all premiums, accrued interest and costs and expenses in connection with the Tender Offer and the 2023 Notes Redemption.
The notes bear interest at the fixed rate of 4.250% per year and mature on August 8, 2032. Interest on the notes will be due semiannually on February 8 and August 8 of each year, commencing February 8, 2023. Prior to May 8, 2032 (three months prior to their maturity date) (the “Par Call Date”), the Company may redeem the notes at its option, in whole or in part, at any time and from time to time, at a redemption price equal to the greater of (i) the make-whole redemption price set forth in the notes less interest accrued to the date of redemption and (ii) 100% of the principal amount of the notes to be redeemed, plus, in either case, accrued and unpaid interest thereon to, but excluding, the redemption date. On or after the Par Call Date, the Company may redeem the notes, in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount of the notes being redeemed plus accrued and unpaid interest thereon to, but excluding, the redemption date.
Additionally, at the option of the holders of the notes, the Company may be required to purchase all or a portion of the notes upon the occurrence of a “Change of Control Triggering Event” (as defined in the Indenture), at a price equal to 101% of the principal amount thereof, plus accrued and unpaid interest to the date of purchase.
The Indenture contains covenants that limit the ability of the Company and certain of its subsidiaries to, among other things, incur or create liens and enter into sale and leaseback transactions. In addition, the Indenture contains a covenant that limits the ability of the Company to consolidate or merge with another entity or to sell all or substantially all of its assets to another entity.
The Indenture contains customary default provisions. In addition, an event of default will occur if the Company or certain of its subsidiaries fail to pay the principal of any Indebtedness (as defined in the Indenture) when due at maturity in an aggregate amount of $50 million or more, or a default occurs that results in the acceleration of the maturity of the Company’s or certain of its subsidiaries’ Indebtedness in an aggregate amount of $50 million or more. Upon the occurrence and during the continuation of an event of default under the Indenture, the notes may become immediately due and payable either automatically or by the vote of the holders of more than 25% of the aggregate principal amount of all of the notes of the applicable series then outstanding.
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