UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 19, 2022
WALGREENS BOOTS ALLIANCE, INC.
(Exact name of registrant as specified in its charter)
Delaware | 001-36759 | 47-1758322 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification Number) |
108 Wilmot Road, Deerfield, Illinois | 60015 | |
(Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (847) 315-2500
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Common Stock, $0.01 par value | WBA | The Nasdaq Stock Market LLC | ||
3.600% Walgreens Boots Alliance, Inc. notes due 2025 | WBA25 | The Nasdaq Stock Market LLC | ||
2.125% Walgreens Boots Alliance, Inc. notes due 2026 | WBA26 | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 Entry Into a Material Definitive Agreement.
Delayed Draw Term Loan Credit Agreement
On December 19, 2022, Walgreens Boots Alliance, Inc. (the “Company”) entered into a delayed draw term loan credit agreement (the “Credit Agreement”) with the designated borrowers from time to time party thereto (each, a “Designated Borrower”), the lenders from time to time party thereto and Toronto Dominion (Texas) LLC, as administrative agent. The commitments shall become effective on and as of the first date, which shall be no later than January 3, 2023, on which the Company has satisfied certain customary conditions set forth in the Credit Agreement (the “Effective Date”).
The Credit Agreement includes a $1,000,000,000 senior unsecured delayed draw term loan facility (the “Facility”). The Facility’s termination date is the date that is the earlier of (a) three years after the initial funding of loans under the Facility and (b) March 31, 2026. Loans under the Credit Agreement shall be denominated in U.S. dollars.
Borrowings under the Credit Agreement will bear interest at a fluctuating rate per annum equal to, at the Company or a Designated Borrower’s option, the alternate base rate, the term SOFR rate or the daily SOFR rate, in each case, plus an applicable margin. The applicable margin is in each case based on the rating of the Company’s corporate debt obligations as determined by Moody’s or S&P. With respect to one week interest payment periods, loans will bear interest at the daily SOFR rate plus 0.03839% and the applicable margin. With respect to all interest periods other than one week, any SOFR loans will bear interest at the term SOFR rate plus 0.10% and the applicable margin.
Voluntary prepayments of the loans and, during the availability period, voluntary reductions of the unutilized portion of the commitments under the Credit Agreement are permissible, in each case, without penalty, subject to certain conditions pertaining to minimum notice and minimum reduction amounts as described in the Credit Agreement. Amounts borrowed under the Facility and repaid or prepaid may not be reborrowed.
The Credit Agreement contains representations and warranties and affirmative and negative covenants customary for unsecured financings of this type. The Credit Agreement includes a financial covenant requiring that, as of the last day of each fiscal quarter, commencing with the first quarter ending after the Effective Date, the ratio of Consolidated Debt to Total Capitalization (as those terms are defined in the Credit Agreement) shall not be greater than 0.60:1.00; provided that such ratio is subject to increase in certain circumstances set forth in the Credit Agreement.
The Credit Agreement also contains various events of default (subject to certain grace periods, to the extent applicable), including, events of default for the nonpayment of principal, interest or fees, breach of covenants; payment defaults on, or acceleration under, certain other material indebtedness; inaccuracy of the representations or warranties in any material respect; bankruptcy or insolvency; certain unfunded liabilities under employee benefit plans; certain unsatisfied judgments; certain ERISA violations; the invalidity or unenforceability of the Credit Agreement or any note issued in accordance therewith; and invalidity of the Parent Guarantee (as defined in the Credit Agreement).
The foregoing description of the Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Credit Agreement, which is attached hereto as Exhibit 10.1 and is incorporated herein by reference.
The lenders under the Credit Agreement and/or their affiliates may have in the past performed, and may in the future from time to time perform, investment banking, financial advisory, lending and/or commercial banking services, or other services for the Company and its subsidiaries, for which they have received, and may in the future receive, customary compensation and expense reimbursement.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off–Balance Sheet Arrangement of a Registrant.
The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.03.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit | Description | |
10.1 | Delayed Draw Term Loan Credit Agreement, dated as of December 19, 2022, by and among Walgreens Boots Alliance, Inc., the Designated Borrowers from time to time party thereto, the Lenders from time to time party thereto and Toronto Dominion (Texas) LLC, as Administrative Agent. | |
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
WALGREENS BOOTS ALLIANCE, INC. | ||
Date: December 20, 2022 | By: | /s/ Joseph B. Amsbary, Jr. |
Name: | Joseph B. Amsbary, Jr. | |
Title: | Senior Vice President and Corporate Secretary |