| Item 1.01. | Entry into a Material Definitive Agreement. |
The disclosure contained in Item 2.03 of this Current Report on Form 8-K is incorporated herein by reference.
| Item 1.02. | Termination of a Material Definitive Agreement. |
The disclosure contained in Item 2.03 of this Current Report on Form 8-K is incorporated herein by reference.
| Item 2.03. | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
On June 22, 2023, Arthur J. Gallagher & Co. (the “Company”) entered into a new Credit Agreement (the “Credit Agreement”) among the Company, as borrower, Bank of America, N.A., as administrative agent and L/C issuer, and the other lenders and L/C issuers party thereto. The Credit Agreement provides for a five-year unsecured revolving credit facility in the amount of $1,200,000,000 (including a $75,000,000 letter of credit sub-facility), which is also available in Pounds Sterling, Canadian Dollars, Australian Dollars, New Zealand Dollars, Euros, Japanese Yen and any other currencies agreed by the lenders from time to time. The Company may also, upon the agreement of either one or more then-existing lenders or of additional banks not currently party to the Credit Agreement, increase the commitments under the Credit Agreement up to $1,700,000,000. The Credit Agreement permits the Company to, from time to time, designate wholly-owned subsidiaries located in certain jurisdictions as additional borrowers, the obligations of which under the Credit Agreement will be guaranteed by the Company, subject to the terms and conditions set forth in the Credit Agreement (any such additional subsidiary borrowers, together with the Company, the “Borrowers”). Any subsidiary that guarantees any notes under the Company’s existing note purchase agreements is required to guarantee the obligations under the Credit Agreement. There are currently no subsidiary borrowers or guarantors under the Credit Agreement.
Loans borrowed under the Credit Agreement bear interest at a variable annual rate based on a customary benchmark rate for each available currency (including term SOFR for loans in U.S. Dollars), or at the Company’s election solely for loans in U.S. Dollars, the base rate, plus in each case an applicable margin. The applicable margin is determined by reference to the rating of the Company’s long-term senior unsecured debt. Subject to certain conditions stated in the Credit Agreement, the Borrowers may borrow, prepay and reborrow amounts under the Credit Agreement at any time during the term of the Credit Agreement. Funds borrowed under the Credit Agreement may be used for general corporate and working capital purposes of the Company and its subsidiaries.
The Credit Agreement also contains customary representations and warranties and affirmative and negative covenants, including financial covenants, as well as customary events of default, with corresponding grace periods, including, without limitation, payment defaults, cross-defaults to other agreements evidencing indebtedness and bankruptcy-related defaults.
The foregoing summary 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, filed herewith as Exhibit 10.1 and incorporated by reference herein.
Concurrently, on June 22, 2023, the Company paid off and terminated all of its obligations under the Second Amended and Restated Multicurrency Credit Agreement, dated as of June 7, 2019.
| Item 9.01. | Financial Statements and Exhibits. |
