Wd 40 Co 8-K, filed Oct 6, 2020
Wd 40 Co (WDFC)
About this 8-K
Wd 40 Co filed this 8-K on October 6, 2020, reporting on events of September 30, 2020.
Items reported
- Item 1.01: Entered into a material agreement
- Item 2.03: New debt or off-balance-sheet obligation
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
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CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): September 30, 2020
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WD-40 COMPANY
(Exact Name of Registrant as specified in its charter)
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(State or other jurisdiction of incorporation or organization) |
| (Commission File Number) WD 40 CO (Commission Company Name) |
| (I.R.S. Employer Identification Number)
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| (Address of principal executive offices, with zip code)
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| ( (Registrant’s telephone number, including area code)
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| n/a (Former name or former address, if changed since last report)
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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 (see General Instruction A.2. below):
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Written Communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Securities registered pursuant to Section 12(b) of the Act:
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Title of each class |
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| Name of exchange on which registered |
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter)
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 o
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ITEM 1.01. Entry into a Material Definitive Agreement
First Amendment to Credit Agreement
On September 30, 2020, WD-40 Company (the “Company”) entered into a First Amendment to Credit Agreement (the “First Amendment to Credit Agreement”) with Bank of America, N.A. (“Bank of America”). The First Amendment to Credit Agreement modifies the Company’s existing $150.0 million Amended and Restated Credit Agreement dated March 16, 2020 (as amended by the First Amendment to Credit Agreement, the “Credit Agreement”). Capitalized terms not otherwise defined in this report have the meaning given to such terms in the Credit Agreement.
The First Amendment to Credit Agreement revises certain financial and restrictive covenants and adjusts the interest rates on borrowings under the Credit Agreement as described below. The maximum Consolidated Leverage Ratio has been increased from 3.0 to 1.0 to 3.5 to 1.0. The Restricted Payments covenant has been modified to permit the payment of dividends so long as immediately prior to and after giving effect to the payment of dividends, no Event of Default exists and the Company and its subsidiary Loan Parties are in compliance with applicable financial covenants. In addition to other non-material and technical amendments to the Credit Agreement, the First Amendment to Credit Agreement also modifies the restrictive covenants relating to Indebtedness and Investments. The limitation on other unsecured Indebtedness (including borrowing under the Company’s amended Note Agreement described below) has been increased from $35.0 million to $125.0 million. With respect to the restrictions on Investments, intercompany loans, advances or capital contributions from any Loan Party to Subsidiaries that are not Loan Parties may be made in an aggregate amount of up to $10.0 million outstanding at any time from and after September 30, 2020. In addition, Investments not otherwise covered by any other exception to the restriction on Investments may be made in an aggregate amount of up to $15.0 million outstanding at any time from and after November 15, 2017. No such Investments have been made from that date through September 30, 2020. The First Amendment to Credit Agreement also modifies the interest rate applicable to borrowings under the Credit Agreement by changing the Applicable Rate from 0.90% for Libor Rate Loans and 0.0% for Prime Rate Loans to a three-tier pricing approach tied to the Company’s Consolidated Leverage Ratio. For Libor Rate Loans and Prime Rate Loans, the Applicable Rate is a spread added to the Libor Daily Floating Rate and Prime Rate, respectively. An increase or decrease in the Applicable Rate will apply in the event of a change in the Consolidated Leverage Ratio from and after the first Business Day after the Company delivers a Compliance Certificate to Bank of America. Table 1 below reflects the tiered Applicable Rate.
Table 1
Pricing Tier | Consolidated Leverage Ratio | Commitment Fee | Libor Rate Loans | Letter of Credit Fee | Prime Rate Loans |
1 | < 2.00 to 1.0 | 0.15% | 1.00% | 1.00% | 0.00% |
2 | < 3.00 to 1.0 but ≥ 2.00 to 1.0 | 0.15% | 1.25% | 1.25% | 0.25% |
3 | ≥ 3.00 to 1.0 | 0.15% | 1.50% | 1.50% | 0.50% |
The new Maturity Date for the revolving credit facility per the Credit Agreement is September 30, 2025.
The material terms of the First Amendment to the Credit Agreement discussed above do not purport to be complete and are qualified in their entirety by the First Amendment to the Credit Agreement attached hereto as Exhibit 10(a) and incorporated herein by reference.
Third Amendment to Note Purchase and Private Shelf Agreement
On September 30, 2020, the Company entered into a Third Amendment to Note Purchase and Private Shelf Agreement (the “Third Amendment to Note Agreement”) amending its existing Note Purchase and Private Shelf Agreement dated November 15, 2017 (as amended February 23, 2018 and amended March 16, 2020, the “Note Agreement”) by and among the Company, PGIM, Inc. (“Prudential”), and certain affiliates and managed accounts of Prudential (the “Note Purchasers”). The Third Amendment to Note Agreement amends the Note Agreement to permit the Company (inclusive of its subsidiaries) to enter into the First Amendment to Credit Agreement with Bank of America and the Third Amendment includes certain conforming amendments to the Note Agreement consistent with the First Amendment to Credit Agreement, including the revision of the financial and restrictive covenants described above.
The material terms of the Third Amendment discussed above do not purport to be complete and are qualified in their entirety by the Third Amendment attached hereto as Exhibit 10(e) and incorporated herein by reference.
All other material terms included in the Amended and Restated Credit Agreement dated March 16, 2020 and the Note Agreement remain unchanged as a result of execution of the First Amendment to Credit Agreement and the Third Amendment to Note Agreement.
Issuance and Sale of $52.0 Million in Notes under Note Purchase and Private Shelf Agreement
On September 30, 2020, the Company issued and sold senior unsecured notes pursuant to the Note Agreement to specified Note Purchasers in the aggregate amount of $52.0 million. Pursuant to the Note Agreement (as amended by the Third Amendment to Note Agreement), the Company agreed to sell $26.0 million aggregate principal amount of senior unsecured notes (the “Series B Notes”) to specified Note Purchasers and the Company agreed to sell $26.0 million aggregate principal amount of senior unsecured notes (the “Series C Notes” and together with the Series B Notes, the “Senior Notes”) to specified Note Purchasers. The Series B Notes will bear interest at 2.5% per annum and will mature on November 15, 2027, unless earlier redeemed by the Company. The Series C Notes will bear interest at 2.69% per annum and will mature on November 15, 2030, unless earlier redeemed by the Company. Interest on the Senior Notes is payable semi-annually beginning on May 15, 2021. The Company expects to use the proceeds from the Senior Notes to pay down $50.0 million in borrowings under the Company’s existing $150.0 million Credit Agreement.
ITEM 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information provided in Item 1.01 above is incorporated herein by reference to this Item 2.03. Other material terms of the Note Agreement not otherwise modified as described in Item 1.01 of this report that are applicable to the Senior Notes are set forth in the Company’s current reports on Form 8-K filed on November 17, 2017, February 27, 2018, and March 19, 2020, each of which are incorporated herein by this reference.
ITEM 9.01. | Financial Statements and Exhibits |
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| (d) Exhibits |
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Exhibit No. | Description |
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10(a) | |
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10(b) | |
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10(c) | |
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10(d) | |
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10(e) | |
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10(f) | |
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10(g) | |
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104 | The cover page from this Current report on Form 8-K, formatted in Inline XBRL |
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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.
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| WD-40 Company |
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| (Registrant) |
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Date: October 6, 2020 |
| /s/ JAY W. REMBOLT |
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| Jay W. Rembolt
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| Vice President, Finance
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| Treasurer and Chief Financial Officer |
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT dated as of September 30, 2020 (this “Amendment”), is entered into among WD-40 COMPANY, a Delaware corporation (the “Company”), WD-40 COMPANY LIMITED (“WD-40 UK”), the Guarantors party hereto (together with the Company and WD-40 UK, each a “Loan Party” and collectively the “Loan Parties”) and BANK OF AMERICA, N.A. (the “Lender”). Capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in the Credit Agreement (defined below).
RECITALS
A.The Loan Parties and the Lender entered into that certain Amended and Restated Credit Agreement dated as of March 16, 2020 (as amended and modified from time to time, the “Credit Agreement”).
B.The parties hereto have agreed to amend the Credit Agreement as provided herein.
C.In consideration of the agreements hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows.
AGREEMENT
1.Amendments.
(a)The following new definition is hereby added to Section 1.01 of the Credit Agreement in the appropriate alphabetical order to read as follows:
“First Amendment Effective Date” means September 30, 2020.
(b)The definition of “Applicable Rate” in Section 1.01 of the Credit Agreement is hereby amended to read as follows:
“Applicable Rate” means the following percentages per annum, based upon the Consolidated Leverage Ratio as set forth in the most recent Compliance Certificate received by the Lender pursuant to Section 7.02(a):
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Pricing Tier |
Consolidated Leverage Ratio |
Commitment Fee |
Letter of Credit Fee |
LIBOR Rate Loans |
Prime Rate Loans |
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< 2.00 to 1.0 |
0.15% |
1.00% |
1.00% |
0.00% |
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< 3.00 to 1.0 but > 2.00 to 1.0 |
0.15% |
1.25% |
1.25% |
0.25% |
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> 3.00 to 1.0 |
0.15% |
1.50% |
1.50% |
0.50% |
Any increase or decrease in the Applicable Rate resulting from a change in the Consolidated Leverage Ratio shall become effective as of the first Business Day immediately following the date a Compliance Certificate is delivered pursuant to Section 7.02(a); provided, however, that if a Compliance Certificate is not delivered when due in accordance with such Section, then, upon the request of the Required Lenders, Pricing Tier 3 shall apply as of the first Business Day after the date on which such Compliance Certificate was required to have been delivered and shall remain in effect until the first Business Day immediately following the date on which such Compliance Certificate is delivered in accordance with Section 7.02(a), whereupon the Applicable Rate shall be adjusted based upon the calculation of the Consolidated Leverage Ratio contained in such Compliance Certificate. The Applicable Rate in effect from the First Amendment Effective Date through the first Business Day immediately following the date a Compliance Certificate is delivered pursuant to Section 7.02(a) for the fiscal quarter ending August 31, 2020 shall be determined based upon Pricing Tier 1.
If, as a result of any restatement of or other adjustment to the financial statements of the Company and its Subsidiaries or for any other reason, the Company or the Lender determines that (i) the Consolidated Leverage Ratio as calculated by the Company as of any applicable date was inaccurate and (ii) a proper calculation of the Consolidated Leverage Ratio would have resulted in higher pricing for such period, the Company shall immediately and retroactively be obligated to pay to the Lender promptly on demand (or, after the occurrence of an actual or deemed entry of an order for relief with respect to the Company under the Bankruptcy Code of the United States, automatically and without further action by the Lender), an amount equal to the excess of the amount of interest and fees that should have been paid for such period over the amount of interest and fees actually paid for such period.
(c)The definition of “Maturity Date” in Section 1.01 of the Credit Agreement is hereby amended to read as follows:
“Maturity Date” means September 30, 2025; provided, however, that, if such date is not a Business Day, the Maturity Date shall be the next preceding Business Day.
(d)Section 1.03(c) of the Credit Agreement is hereby amended to read as follows:
(c)Calculations. Notwithstanding the above, the parties hereto acknowledge and agree that all calculations of the financial covenants in Section 8.11 (including for purposes of determining the Applicable Rate) shall be made on a Pro Forma Basis with respect to (i) any Disposition of all of the Equity Interests of, or all or substantially all of the assets of, a Subsidiary, (ii) any Disposition of a line of business or division of the Company or Subsidiary, or (iii) any Acquisition, in each case, occurring during the applicable period.
(e)Section 8.02 of the Credit Agreement is hereby amended to read as follows:
8.02Investments.
Make or permit to exist any Investments, except:
(a)Investments held in the form of cash or Cash Equivalents;
(b)Investments existing as of November 15, 2017;
(c)Investments in any Person that is a Loan Party prior to giving effect to such Investment;
(d)Investments by any Subsidiary that is not a Loan Party in any other Subsidiary that is not a Loan Party;
(e)Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of business, and Investments received in satisfaction or partial satisfaction thereof from financially troubled account debtors to the extent reasonably necessary in order to prevent or limit loss;
(f)Guarantees permitted by Section 8.03;
(g)Permitted Acquisitions;
(h)intercompany loans, advances and capital contributions made by any Loan Party to any of its Subsidiaries which are not Loan Parties (i) made prior to the First Amendment Effective Date and (ii) made on or after the First Amendment Effective Date, in an amount not to exceed $10,000,000 in the aggregate at any time outstanding; and
(i)Investments of a nature not contemplated in the foregoing clauses in an amount not to exceed $15,000,000 in the aggregate at any time outstanding.
(f)Section 8.03(f) of the Credit Agreement is hereby amended to read as follows:
(f)other unsecured Indebtedness (including any Indebtedness arising under the Note Purchase Agreement) in an aggregate principal amount not to exceed $125,000,000 at any one time outstanding;
(g)Section 8.06(c) of the Credit Agreement is hereby amended to read as follows:
(c)so long as immediately prior and after giving effect thereto (i) no Default exists and (ii) the Loan Parties would be in compliance with the financial covenants set forth in Section 8.11 on a Pro Forma Basis, the Company may make cash dividends; and
(h)Section 8.11(a) of the Credit Agreement is hereby amended to read as follows:
(a)Consolidated Leverage Ratio. Permit the Consolidated Leverage Ratio as of the end of any fiscal quarter of the Company to be greater than 3.50 to 1.00.
2.Effectiveness; Conditions Precedent. This Amendment shall be effective, as of the date hereof, upon satisfaction of the following conditions precedent:
(a)The Lender shall have received copies of this Amendment duly executed by the Loan Parties.
(b)The Lender shall have received (i) such resolutions or other action, incumbency certificates and/or other certificates of Responsible Officers of the Loan Parties as the Lender may require evidencing the identity, authority and capacity of each Responsible Officer thereof authorized to act as a Responsible Officer in connection with this Amendment and the other Loan Documents to which each Loan Party is a party; (ii) (A) copies of the Organization Documents of each Loan Party certified to be true and complete as of a recent date by the appropriate Governmental Authority of the state or other jurisdiction of its incorporation or organization, where applicable or (B) a certification that such Loan Party has not modified its Organization Documents since such documents were delivered to the Lender on the Closing Date and such Organization
Documents remain in full force and effect, in each case, certified by a Responsible Officer of such Loan Party to be true and correct as of the date hereof and (iii) such documents and certifications as the Lender may reasonably require to evidence that each Loan Party is duly organized or formed, and is validly existing, in good standing and qualified to engage in business in its state of organization.
(d)Receipt by the Lender of a copy of an executed amendment to the Note Purchase Agreement in form and substance reasonably satisfactory to the Lender.
(e)Receipt by the Lender of all fees and expenses owed by the Loan Parties to the Lender in connection with this Amendment.
(f)The Company shall have paid all reasonable fees, charges and disbursements of counsel to the Lender in connection with this Amendment (directly to such counsel if requested by the Lender).
3.Ratification of Loan Documents. Each Loan Party acknowledges and consents to the terms set forth herein and agrees that this Amendment does not impair, reduce or limit any of its obligations under the Loan Documents. This Amendment is a Loan Document.
4.Authority/Enforceability. Each Loan Party represents and warrants as follows:
(a)It has taken all necessary action to authorize the execution, delivery and performance of this Amendment.
(b)This Amendment has been duly executed and delivered by such Person and constitutes such Person’s legal, valid and binding obligations, enforceable in accordance with its terms.
(c)No consent, approval, authorization or order of, or filing, registration or qualification with, any court or Governmental Authority or third party is required in connection with the execution, delivery or performance by such Person of this Amendment, or, if such consent is required, it has been obtained.
(d)The execution and delivery of this Amendment does not (i) violate, contravene or conflict with any provision of its Organization Documents or (ii) materially violate, contravene or conflict with any Laws applicable to it or any of its Subsidiaries.
5.Representations and Warranties of the Loan Parties. Each Loan Party represents and warrants that after giving effect to this Amendment (a) the representations and warranties of the Loan Party set forth in Article VI of the Credit Agreement are true and correct in all material respects as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date, and (b) no event has occurred and is continuing which constitutes a Default.
6.Counterparts/Telecopy-pdf. This Amendment may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all of which shall constitute one and the same instrument. Delivery of executed counterparts of this Amendment by telecopy or pdf shall be effective as an original.
7.Governing Law. This Amendment and the rights and obligations of the parties hereunder shall be governed by and construed and interpreted in accordance with the laws of the state of California.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date first above written.
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COMPANY: |
WD-40 COMPANY, |
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a Delaware Corporation |
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By: |
/s/ JAY W. REMBOLT |
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Name: |
Jay W. Rembolt |
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Title: |
Treasurer and Chief Financial Officer |
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DESIGNATED BORROWER |
WD-40 COMPANY LIMITED, |
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GUARANTOR: |
a company incorporated in England and Wales |
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By: |
/s/ GARRY O. RIDGE |
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Name: |
Garry O. Ridge |
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Title: |
Director |
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GUARANTORS: |
WD-40 MANUFACTURING COMPANY, |
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a California corporation |
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By: |
/s/ JAY W. REMBOLT |
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Name: |
Jay W. Rembolt |
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Title: |
Treasurer and Chief Financial Officer |
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HPD LABORATORIES INC., |
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a Delaware corporation |
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By: |
/s/ JAY W. REMBOLT |
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Name: |
Jay W. Rembolt |
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Title: |
Treasurer and Chief Financial Officer |
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HEARTLAND CORPORATION, |
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a Kansas corporation |
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By: |
/s/ JAY W. REMBOLT |
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Name: |
Jay W. Rembolt |
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Title: |
Treasurer and Chief Financial Officer |
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LENDER: |
BANK OF AMERICA, N.A., |
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as a Lender, |
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By: |
/s/ AARON MARKS |
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Name: |
Aaron Marks |
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Title: |
Senior Vice President |
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*****Text omitted pursuant to
Item 601(a)(6) of Regulation S-K
PGIM, Inc. and the Noteholders signatory hereto
c/o Prudential Private Capital
2029 Century Park East, Suite 860
Los Angeles, CA 90067
As of September 30, 2020
WD-40 Company
9715 Businesspark Avenue
San Diego, CA 92131
Re:Third Amendment to Note Purchase and Private Shelf Agreement
Ladies and Gentlemen:
Reference is made to that certain Note Purchase and Private Shelf Agreement, dated as of November 15, 2017 (as amended or otherwise modified from time to time, the “Agreement”), by and between WD-40 Company, a Delaware corporation, on the one hand, and PGIM, Inc. and the other Purchasers, on the other hand. Capitalized terms used and not otherwise defined herein shall have the meanings provided in the Agreement.
1.Amendments to Agreement. Pursuant to the provisions of Section 17 of the Agreement, and subject to the terms and conditions of this letter agreement, the undersigned holders of Notes (the “Noteholders”) and the Company hereby agree that the Agreement is hereby amended, as follows:
(a)Section 10.2 is amended and restated, as follows:
“10.2Investments. The Company will not, and will not permit any Subsidiary to, make or permit to exist any Investments, except:
(a)Investments held in the form of cash or Cash Equivalents;
(b)Investments existing as of November 15, 2017;
(c)Investments in any Person that is a Credit Party prior to giving effect to such Investment;
(d)Investments by any Subsidiary that is not a Credit Party in any other Subsidiary that is not a Credit Party;
(e)Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of business, and Investments received in satisfaction or partial satisfaction thereof from financially troubled account debtors to the extent reasonably necessary in order to prevent or limit loss;
(f)Guaranties permitted by Section 10.3;
(g)Permitted Acquisitions;
(h)intercompany loans, advances or capital contributions made by any Credit Party to any of its Subsidiaries which are not Credit Parties (i) made prior to September 30, 2020 and (ii) made on or after September 30, 2020, in an amount not to exceed $10,000,000 in the aggregate at any time outstanding; and
(i)Investments of a nature not contemplated in the foregoing clauses in an amount not to exceed the greater of (i) $15,000,000 in the aggregate at any time outstanding, and (ii) the limitation on such Investments provided for in the Bank Credit Agreement, provided that this clause (ii) shall not apply if (1) a Default or Event of Default existed at the time the modification providing for the applicable greater limitation on such Investments under the Bank Credit Agreement became effective, or (2) if any lenders under the Bank Credit Agreement received any remuneration or other consideration for such modification, unless the holders of the Notes concurrently received their ratable share of such remuneration or other consideration.”
(b)Section 10.3(f) is amended and restated, as follows:
“(f)other unsecured Indebtedness in an aggregate principal amount not to exceed $125,000,000 at any one time outstanding;”
(c)Section 10.6(c) is amended and restated, as follows:
“(c)so long as immediately prior and after giving effect thereto (i) no Default or Event of Default exists and (ii) the Company would be in compliance with the financial covenants set forth in Section 10.11 on a Pro Forma Basis, the Company may make cash dividends; and”
(d)Section 10.11(b) is amended and restated, as follows:
“(b)Consolidated Leverage Ratio. The Company will not, and will not permit any Subsidiary to, permit the Consolidated Leverage Ratio as of the end of any fiscal quarter of the Company to be greater than 3.50 to 1.00.”
(e)Section 21.2 is amended and restated, as follows:
“21.2Accounting Terms.
All accounting terms used herein which are not expressly defined in this Agreement have the meanings respectively given to them in accordance with GAAP. Except as otherwise specifically provided herein, (i) all computations made pursuant to this Agreement shall be made in accordance with GAAP, and (ii) all financial statements shall be prepared in accordance with GAAP. Notwithstanding the above, the parties hereto acknowledge and agree that all calculations of the financial covenants in Section 10.11 shall be made on a Pro Forma Basis with respect to (i) any Disposition of all of the Equity Interests of, or all or substantially all of the assets of, a Subsidiary, (ii) any Disposition of a line of business or division of the Company or Subsidiary, or (iii) any Acquisition, in each case, occurring during the applicable period. In addition, for purposes of determining compliance with this Agreement (including Section 9, Section 10 and the definition of “Indebtedness”), any election by the Company or any Subsidiary to measure any financial liability or other accounting metric using fair value (as permitted by Financial Accounting Standards Board Accounting Standards Codification Topic No. 825-10-25 – Fair Value Option, International Accounting Standard 39 – Financial Instruments: Recognition and Measurement or any other accounting standard that would result in any financial liability being set forth at an amount less than the actual outstanding principal amount thereof)
shall be disregarded and such determination shall be made as if such election had not been made. Any lease that is properly characterized as a financing lease in accordance with GAAP but is, for purposes of the Company’s adoption of ASC 842 (regardless of the date on which such lease has been entered into), disregarded as an immaterial financing lease on the Company’s consolidated financial statements (and which the Company’s independent certified public auditor has permitted to be disregarded as immaterial on such financial statements), shall not be a Capital Lease for purposes of this Agreement.”
(f)The Information Schedule is amended and restated in the form set forth as Exhibit A to this letter agreement.
2.Limitation of Modifications. The modifications effected in this letter agreement shall be limited precisely as written and shall not be deemed to be (a) an amendment, consent, waiver or other modification of any other terms or conditions of the Agreement or any other document related to the Agreement, or (b) a consent to any future amendment, consent, waiver or other modification. Except as expressly set forth in this letter agreement, each of the Agreement and the documents related to the Agreement shall continue in full force and effect. The parties hereto acknowledge and agree that this letter agreement constitutes a Transaction Document.
3.Representations and Warranties. The Company hereby represents and warrants as follows: (i) No Default or Event of Default has occurred and is continuing (both immediately before and immediately after giving effect to the effectiveness of this letter agreement); (ii) the Company’s entering into and performance of the Agreement, as modified by this letter agreement, has been duly authorized by all necessary corporate and other action and do not and will not require any registration with, consent or approval of, or notice to or action by, any Person (including any Governmental Authority) in order to be effective and enforceable; (iii) the Agreement, as modified by this letter agreement, constitutes the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its respective terms except as the enforceability thereof may be limited by bankruptcy, insolvency or other similar laws of general application relating to or affecting the enforcement of creditors’ rights or by general principles of equity; (iv) no fee or other remuneration will be provided to any of the parties to the Bank Credit Agreement as consideration for the amendments provided under the amendment to the Bank Credit Agreement referred to below in clause (ii) of Section 4; and (v) immediately after giving effect to this letter agreement, each of the representations and warranties of the Company set forth in the Agreement is true and correct as of the date hereof (except to the extent such representations and warranties expressly relate to another date, in which case such representations and warranties are true and correct as of such other date).
4.Effectiveness.This letter agreement shall become effective, as of the date hereof (and immediately prior to the purchase and sale of the Shelf Notes occurring on the date hereof), on the date on which (i) the Noteholders shall have received a fully executed counterpart of this letter agreement from each Credit Party, (ii) the Noteholders shall have received a copy of a fully executed amendment to the Bank Credit Agreement in form and substance reasonably satisfactory to the Required Holders, and (iii) the Company shall have paid, by wire transfer of immediately available funds, all reasonable fees, charges and disbursements of counsel to the Noteholders in connection with this letter agreement.
5.Miscellaneous.
(a)This document may be executed in multiple counterparts, which together shall constitute a single document. Delivery of executed counterparts of this letter agreement by telefacsimile or other secure electronic format (pdf) shall be effective as an original.
(b)This letter agreement shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the internal laws of New York, excluding choice-of-law principles of the law of such state that would permit the application of the laws of a jurisdiction other than such state.
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If you are in agreement with the foregoing, please sign this letter agreement in the space indicated below whereupon, subject to the conditions expressed herein, it shall become a binding agreement among each party named as a signatory hereto.
Sincerely,
PGIM, INC.
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By: |
/s/ T.J. FLANAGAN III |
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Vice President |
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
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By: |
/s/ T.J. FLANAGAN III |
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Vice President |
FARMERS INSURANCE EXCHANGE
By:PGIM Private Placement Investors, L.P. (as Investment Advisor)
as Investment Manager
By:PGIM Private Placement Investors, Inc. (as its General Partner)
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By: |
/s/ T.J. FLANAGAN III |
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Vice President |
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MID CENTURY INSURANCE COMPANY
By:PGIM Private Placement Investors, L.P. (as Investment Advisor)
as Investment Manager
By:PGIM Private Placement Investors, Inc. (as its General Partner)
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By: |
/s/ T.J. FLANAGAN III |
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Vice President |
Accepted and agreed to as of the date first appearing above:
WD-40 COMPANY, a Delaware corporation
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By: |
/s/ JAY W. REMBOLT |
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Name: |
Jay W. Rembolt |
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Title: |
Chief Financial Officer |
Each of the Guarantors hereby (a) consents to and agrees to be bound by the amendments and other modification effected by this letter agreement and the other transactions contemplated hereby, (b) reaffirms its obligations under the Multiparty Guaranty and its waivers, as set forth in the Multiparty Guaranty, of each and every one of the possible defenses to such obligations, and (c) reaffirms that its obligations under the Multiparty Guaranty are separate and distinct from the obligations of the Company under the Agreement and the Notes.
WD-40 MANUFACTURING COMPANY, a California corporation
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By: |
/s/ JAY W. REMBOLT |
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Name: |
Jay W. Rembolt |
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Title: |
Chief Financial Officer |
HPD LABORATORIES INC., a Delaware corporation
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By: |
/s/ JAY W. REMBOLT |
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Name: |
Jay W. Rembolt |
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Title: |
Chief Financial Officer |
HEARTLAND CORPORATION, a Kansas corporation
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By: |
/s/ JAY W. REMBOLT |
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Name: |
Jay W. Rembolt |
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Title: |
Chief Financial Officer |
WD-40 COMPANY LIMITED, a company incorporated in England and Wales
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By: |
/s/ GARRY O. RIDGE |
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Name: |
Garry O. Ridge |
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Title: |
Director |
EXHIBIT A
INFORMATION SCHEDULE
Authorized Officers for PIM
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T.J. Flanagan III |
Adolfo Cabrera Email: *****
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Jason Richardson |
James McCrane |
Authorized Officers for the Company
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Jay Rembolt Vice President, Finance; Treasurer and Chief Financial Officer WD-40 COMPANY
9715 Businesspark Avenue Telephone:***** Facsimile:***** Email: *****
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Richard Clampitt Vice President, General Counsel and Corporate Secretary WD-40 COMPANY
9715 Businesspark Avenue Telephone:***** Facsimile:***** Email: *****
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Garry Ridge President and Chief Executive Officer WD-40 COMPANY
9715 Businesspark Avenue Telephone:***** Facsimile:***** Email: *****
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Rae Ann Partlo Vice President, Corporate Controller WD-40 COMPANY
9715 Businesspark Avenue Telephone:***** Facsimile:***** Email: *****
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WD-40 COMPANY
SERIES B SENIOR NOTE
No. B-1CUSIP PPN: 92968* AB3
ORIGINAL PRINCIPAL AMOUNT: $21,000,000
ORIGINAL ISSUE DATE: September 30, 2020
INTEREST RATE: 2.50%
INTEREST PAYMENT DATES: Semi-annually on each May 15 and November 15, beginning on May 15, 2021
FINAL MATURITY DATE: November 15, 2027
PRINCIPAL PREPAYMENT DATES AND AMOUNTS: N/A
FOR VALUE RECEIVED, the undersigned, WD-40 COMPANY (herein called the “Company”), a corporation organized under the laws of the State of Delaware, hereby promises to pay to PRUDENTIAL RETIREMENT INSURANCE AND ANNUITY COMPANY, or registered assigns, the principal sum of TWENTY-ONE MILLION DOLLARS (or so much thereof as shall not have been prepaid) on the Final Maturity Date specified above with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at the Interest Rate per annum specified above, payable on the Final Maturity Date specified above and on each Interest Payment Date specified above, commencing with the Interest Payment Date next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) at a rate per annum from time to time equal to the Default Rate (x) on any overdue payment of interest, and (y) during the continuance of an Event of Default on such unpaid principal balance, any overdue payment of interest and any overdue payment of any Make-Whole Amount, in the case of each of clause (x) and (y), payable on each Interest Payment Date as aforesaid (or, at the option of the registered holder hereof, on demand).
Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at JPMorgan Chase Bank, New York, New York or at such other place as the holder hereof shall designate to the Company in writing as provided in the Agreement referred to below.
This Note is one of a series of senior notes (herein called the “Notes”) issued pursuant to a Note Purchase and Private Shelf Agreement, dated as of November 15, 2017 (as from time to time amended, restated, supplemented or otherwise modified, the “Agreement”), between the Company, on the one hand, and the other Persons party thereto, on the other hand, and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, to have (i) agreed to the confidentiality provisions set forth in Section 20 of the Agreement and (ii) made the representation set forth in Section 6.2 of the Agreement. Unless otherwise indicated, capitalized terms used in this Note shall have the respective meanings ascribed to such terms in the Agreement.
This Note is a registered Note and, as provided in the Agreement, upon surrender of this Note for registration of transfer, accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due
presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary.
This Note is [also] subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Agreement, but not otherwise.
If an Event of Default occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount), and with the effect provided in the Agreement.
This Note shall be construed and enforced in accordance with, and the rights of the Company and the holder of this Note shall be governed by, the law of the State of New York excluding choice-of-law principles of the law of such state that would permit the application of the laws of a jurisdiction other than such state.
WD-40 COMPANY
SERIES B SENIOR NOTE
No. B-2CUSIP PPN: 92968* AB3
ORIGINAL PRINCIPAL AMOUNT: $5,000,000
ORIGINAL ISSUE DATE: September 30, 2020
INTEREST RATE: 2.50%
INTEREST PAYMENT DATES: Semi-annually on each May 15 and November 15, beginning on May 15, 2021
FINAL MATURITY DATE: November 15, 2027
PRINCIPAL PREPAYMENT DATES AND AMOUNTS: N/A
FOR VALUE RECEIVED, the undersigned, WD-40 COMPANY (herein called the “Company”), a corporation organized under the laws of the State of Delaware, hereby promises to pay to THE PRUDENTIAL INSURANCE COMPANY OF AMERICA, or registered assigns, the principal sum of FIVE MILLION DOLLARS (or so much thereof as shall not have been prepaid) on the Final Maturity Date specified above with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at the Interest Rate per annum specified above, payable on the Final Maturity Date specified above and on each Interest Payment Date specified above, commencing with the Interest Payment Date next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) at a rate per annum from time to time equal to the Default Rate (x) on any overdue payment of interest, and (y) during the continuance of an Event of Default on such unpaid principal balance, any overdue payment of interest and any overdue payment of any Make-Whole Amount, in the case of each of clause (x) and (y), payable on each Interest Payment Date as aforesaid (or, at the option of the registered holder hereof, on demand).
Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at JPMorgan Chase Bank, New York, New York or at such other place as the holder hereof shall designate to the Company in writing as provided in the Agreement referred to below.
This Note is one of a series of senior notes (herein called the “Notes”) issued pursuant to a Note Purchase and Private Shelf Agreement, dated as of November 15, 2017 (as from time to time amended, restated, supplemented or otherwise modified, the “Agreement”), between the Company, on the one hand, and the other Persons party thereto, on the other hand, and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, to have (i) agreed to the confidentiality provisions set forth in Section 20 of the Agreement and (ii) made the representation set forth in Section 6.2 of the Agreement. Unless otherwise indicated, capitalized terms used in this Note shall have the respective meanings ascribed to such terms in the Agreement.
This Note is a registered Note and, as provided in the Agreement, upon surrender of this Note for registration of transfer, accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary.
This Note is [also] subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Agreement, but not otherwise.
If an Event of Default occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount), and with the effect provided in the Agreement.
This Note shall be construed and enforced in accordance with, and the rights of the Company and the holder of this Note shall be governed by, the law of the State of New York excluding choice-of-law principles of the law of such state that would permit the application of the laws of a jurisdiction other than such state.
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WD-40 COMPANY |
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By: |
/s/ JAY W. REMBOLT |
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Name: |
Jay W. Rembolt |
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Title: |
Chief Financial Officer |
WD-40 COMPANY
SERIES C SENIOR NOTE
No. C-1CUSIP PPN: 92968* AC1
ORIGINAL PRINCIPAL AMOUNT: $21,000,000
ORIGINAL ISSUE DATE: September 30, 2020
INTEREST RATE: 2.69%
INTEREST PAYMENT DATES: Semi-annually on each May 15 and November 15, beginning on May 15, 2021
FINAL MATURITY DATE: November 15, 2030
PRINCIPAL PREPAYMENT DATES AND AMOUNTS: N/A
FOR VALUE RECEIVED, the undersigned, WD-40 COMPANY (herein called the “Company”), a corporation organized under the laws of the State of Delaware, hereby promises to pay to THE PRUDENTIAL INSURANCE COMPANY OF AMERICA, or registered assigns, the principal sum of TWENTY-ONE MILLION DOLLARS (or so much thereof as shall not have been prepaid) on the Final Maturity Date specified above with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at the Interest Rate per annum specified above, payable on the Final Maturity Date specified above and on each Interest Payment Date specified above, commencing with the Interest Payment Date next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) at a rate per annum from time to time equal to the Default Rate (x) on any overdue payment of interest, and (y) during the continuance of an Event of Default on such unpaid principal balance, any overdue payment of interest and any overdue payment of any Make-Whole Amount, in the case of each of clause (x) and (y), payable on each Interest Payment Date as aforesaid (or, at the option of the registered holder hereof, on demand).
Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at JPMorgan Chase Bank, New York, New York or at such other place as the holder hereof shall designate to the Company in writing as provided in the Agreement referred to below.
This Note is one of a series of senior notes (herein called the “Notes”) issued pursuant to a Note Purchase and Private Shelf Agreement, dated as of November 15, 2017 (as from time to time amended, restated, supplemented or otherwise modified, the “Agreement”), between the Company, on the one hand, and the other Persons party thereto, on the other hand, and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, to have (i) agreed to the confidentiality provisions set forth in Section 20 of the Agreement and (ii) made the representation set forth in Section 6.2 of the Agreement. Unless otherwise indicated, capitalized terms used in this Note shall have the respective meanings ascribed to such terms in the Agreement.
This Note is a registered Note and, as provided in the Agreement, upon surrender of this Note for registration of transfer, accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due
presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary.
This Note is [also] subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Agreement, but not otherwise.
If an Event of Default occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount), and with the effect provided in the Agreement.
This Note shall be construed and enforced in accordance with, and the rights of the Company and the holder of this Note shall be governed by, the law of the State of New York excluding choice-of-law principles of the law of such state that would permit the application of the laws of a jurisdiction other than such state.
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WD-40 COMPANY |
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By: |
/s/ JAY W. REMBOLT |
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Name: |
Jay W. Rembolt |
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Title: |
Chief Financial Officer |
WD-40 COMPANY
SERIES C SENIOR NOTE
No. C-2CUSIP PPN: 92968* AC1
ORIGINAL PRINCIPAL AMOUNT: $5,000,000
ORIGINAL ISSUE DATE: September 30, 2020
INTEREST RATE: 2.69%
INTEREST PAYMENT DATES: Semi-annually on each May 15 and November 15, beginning on May 15, 2021
FINAL MATURITY DATE: November 15, 2030
PRINCIPAL PREPAYMENT DATES AND AMOUNTS: N/A
FOR VALUE RECEIVED, the undersigned, WD-40 COMPANY (herein called the “Company”), a corporation organized under the laws of the State of Delaware, hereby promises to pay to THE PRUDENTIAL INSURANCE COMPANY OF AMERICA, or registered assigns, the principal sum of FIVE MILLION DOLLARS (or so much thereof as shall not have been prepaid) on the Final Maturity Date specified above with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at the Interest Rate per annum specified above, payable on the Final Maturity Date specified above and on each Interest Payment Date specified above, commencing with the Interest Payment Date next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) at a rate per annum from time to time equal to the Default Rate (x) on any overdue payment of interest, and (y) during the continuance of an Event of Default on such unpaid principal balance, any overdue payment of interest and any overdue payment of any Make-Whole Amount, in the case of each of clause (x) and (y), payable on each Interest Payment Date as aforesaid (or, at the option of the registered holder hereof, on demand).
Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at JPMorgan Chase Bank, New York, New York or at such other place as the holder hereof shall designate to the Company in writing as provided in the Agreement referred to below.
This Note is one of a series of senior notes (herein called the “Notes”) issued pursuant to a Note Purchase and Private Shelf Agreement, dated as of November 15, 2017 (as from time to time amended, restated, supplemented or otherwise modified, the “Agreement”), between the Company, on the one hand, and the other Persons party thereto, on the other hand, and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, to have (i) agreed to the confidentiality provisions set forth in Section 20 of the Agreement and (ii) made the representation set forth in Section 6.2 of the Agreement. Unless otherwise indicated, capitalized terms used in this Note shall have the respective meanings ascribed to such terms in the Agreement.
This Note is a registered Note and, as provided in the Agreement, upon surrender of this Note for registration of transfer, accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary.
This Note is [also] subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Agreement, but not otherwise.
If an Event of Default occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount), and with the effect provided in the Agreement.
This Note shall be construed and enforced in accordance with, and the rights of the Company and the holder of this Note shall be governed by, the law of the State of New York excluding choice-of-law principles of the law of such state that would permit the application of the laws of a jurisdiction other than such state.