| Item 1.01. | Entry Into a Material Definitive Agreement. |
On April 15, 2022, Agilent Technologies, Inc. (the “Company”) entered into a Term Loan Agreement among the Company, the lenders party thereto and Wells Fargo Bank, National Association, as Administrative Agent (the “Term Loan Agreement”). The Term Loan Agreement provides for a $600,000,000 delayed draw term loan facility (the “Facility”) that is scheduled to mature on April 15, 2025. No amounts were borrowed under the Term Loan Agreement on the closing date. The Company expects to borrow under the Term Loan Agreement on or about May 3, 2022 and use the proceeds thereof to fund the redemption of the Company’s 3.875% Senior Notes due 2023 on May 4, 2022.
Loans under the Term Loan Agreement will bear interest, at the Company’s option, either at: (i) the alternate base rate, which is defined as the highest of (a) the prime rate then in effect, (b) the federal funds effective rate then in effect plus 1/2 of 1.00%, or (c) Adjusted Term SOFR (term SOFR plus 0.10%) plus 1.00%, in each case plus the applicable margin for such loans, or (ii) Adjusted Term SOFR (term SOFR plus 0.10%) plus the applicable margin for such loans. The applicable margin for loans bearing interest at the alternate base rate ranges between 0.000% and 0.250%, and the applicable margin for loans bearing interest based on Adjusted Term SOFR ranges between 0.625% and 1.250%, in each case based on the Company’s senior debt credit ratings as published by S&P Global Ratings, Moody’s Investors Service, Inc. and Fitch Ratings Inc. At the Company’s current credit ratings, the applicable margin for alternate base rate loans is 0.000%, and the applicable margin for Adjusted Term SOFR loans is 0.750%.
The Term Loan Agreement contains customary representations and warranties as well as customary affirmative and negative covenants. Negative covenants include, among others, limitations on incurrence of liens, limitations on incurrence of indebtedness by the Company’s subsidiaries and limitations on sale-leaseback transactions. These covenants are subject to a number of significant exceptions and limitations. In addition, the Term Loan Agreement requires that the Company’s ratio of adjusted consolidated financial indebtedness to consolidated capitalization not be greater than 0.65 to 1.00 as of the end of any of its fiscal quarters.
The Term Loan Agreement also contains customary events of default. 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 Term Loan Agreement immediately due and payable. In addition, if the Company or certain of its material subsidiaries becomes the subject of voluntary or involuntary proceedings under any bankruptcy, insolvency or similar law, then any outstanding obligations under the Term Loan Agreement will automatically become immediately due and payable.
Wells Fargo Securities, LLC, BofA Securities, Inc., and Mizuho Bank, Ltd. acted as joint lead arrangers and joint bookrunners for the Term Loan Agreement.
The description of the Term Loan Agreement contained herein is qualified in its entirety by reference to the Term Loan Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
