| Item 1.01 | Entry into a Material Definitive Agreement. |
On January 22, 2024, NewMarket Corporation (the “Company”) entered into a credit agreement for a new $900 million revolving credit facility (the “Revolving Credit Agreement”) among the Company, the Foreign Subsidiary Borrowers that may from time to time be party thereto (such subsidiaries, collectively with the Company, the “Borrower”), Bank of America, N.A., as Administrative Agent, Wells Fargo Bank, National Association, as Syndication Agent, and the other lenders party thereto. The revolving credit facility matures on January 22, 2029 and includes a $500 million sublimit for multicurrency borrowings, an initial letter of credit sublimit of $25 million and a $20 million sublimit for swingline loans. The Revolving Credit Agreement includes an expansion feature allowing the Company, subject to certain conditions, to request an increase in the aggregate amount of the revolving credit facility or obtain incremental term loans in an amount up to $450 million. The Company may also request an extension of the maturity date as provided for in the Revolving Credit Agreement.
On January 22, 2024, the Company also entered into a credit agreement for a $250 million term loan (the “Term Loan Credit Agreement” and, together with the Revolving Credit Agreement, the “Credit Agreements”) among the Company, Bank of America, N.A., as Administrative Agent, Wells Fargo Bank, National Association, as Syndication Agent, and the other lenders party thereto. The term loan matures on January 22, 2026. The Company is required to repay the principal amount borrowed under the term loan in full at maturity. The Company may, in its sole discretion and subject to the conditions set forth in the Term Loan Credit Agreement, prepay amounts borrowed under the term loan, together with any accrued and unpaid interest, prior to maturity. Any amounts prepaid prior to maturity are not available for additional borrowings by the Company.
Borrowings under the revolving credit facility will bear interest at a variable rate equal to the Base Rate, in the case of any Base Rate Loan, Term SOFR, in the case of any Term SOFR Loan, Weekly Adjusted Term SOFR, in the case of any Term SOFR Weekly Floating Rate Loan, the Alternative Currency Term Rate, in the case of any Alternative Currency Term Rate Loan, or the Alternative Currency Daily Rate, in the case of any Alternative Currency Daily Rate Loan, plus, in each case, the Applicable Rate. The Applicable Rate is based, at the Company’s option, on either the Company’s Leverage Ratio or Ratings Level.
The principal amount borrowed under the term loan initially bears interest at a variable rate equal to Term SOFR plus the Applicable Rate. The Company may, in its discretion, elect for outstanding portions of the principal amount to instead bear interest at a variable rate equal to the Base Rate or Weekly Adjusted Term SOFR plus, in each case, the Applicable Rate, subject to the conditions set forth in the Term Loan Credit Agreement. Similar to the revolving credit facility, the Applicable Rate is based, at the Company’s option, on either the Company’s Leverage Ratio or Ratings Level.
The obligations under the revolving credit facility and term loan are unsecured, and the obligations under the revolving credit facility are fully and unconditionally guaranteed by the Company.
Each Credit Agreement includes certain representations, warranties, covenants and other terms and conditions customary for transactions of these types. These include negative covenants limiting the ability of the Company and its subsidiaries to, among other things: (1) incur indebtedness and create liens; (2) merge into or consolidate with any other person or permit any person to merge into or consolidate with them; (3) enter into certain transactions with affiliates; (4) make changes to their lines of business; or (5) change their fiscal years.
Each Credit Agreement also contains a financial covenant that requires the Company to maintain a consolidated Leverage Ratio of no more than 3.75 to 1.00 except during an Increased Leverage Period.
Each Credit Agreement contains certain customary events of default, including, among others: (1) failure to pay when due principal, interest or any other amounts due and payable under the applicable Credit Agreement; (2) any representation or warranty in the applicable Credit Agreement or related loan documents being incorrect in any material respect when made or deemed to have been made; (3) a breach of certain specified covenants; (4) the occurrence of any event or condition resulting in any Material Indebtedness becoming due prior to its schedule maturity or subject to acceleration; (5) the occurrence of certain ERISA events, bankruptcy and insolvency events or the occurrence of a Change of Control; (6) an inability of the Borrower or any Material Subsidiary to pay its debts as they become due; (7) certain judgments being rendered against the Company or any Subsidiary and remaining
