AVNET INC: Entering into a Material Definitive Agreement, Creating a Direct Financial Obligation or Obligation Under an Off-Balance Sheet Arrangement of a Registrant, Financial Statements and Supporting Documentation (Form 8-K)

Section 1.01 Entering into a Material Definitive Agreement.

On August 2, 2022, Avnet, Inc. (“Avnet”) and Avnet Holding Europe B.V. (“Avnet Europe”) has entered into a Second Amended and Restated Credit Agreement (the “Second Amended Credit Agreement”) with Bank of America, North America. as administrative agent, line of credit lender and letter of credit issuer; BNP Paribas, JPMorgan Chase Bank, North America., MUFG Bank, Ltd.The Bank of Nova Scotia and
Truist Bank as co-syndication agents; and various other lenders. The Second Amended Credit Agreement, which amended and extended Avnet’s existing Amended and Restated Credit Agreement dated June 28, 2018as amended (“Initial Credit Agreement”), provides for a period of five years $1,250,000,000 senior unsecured revolving credit facility, with an option to increase covenants thereunder up to $250,000,000 provided that no Event of Default exists and other conditions are satisfied, and that it is scheduled to mature on August 2, 2027.

Under the second amended credit agreement, loans can be made in WE Dollars, Euros and British Pounds up to the full principal amount of the facility, but is subject to a $200,000,000 sub-limit for aggregate issues of stand-by and commercial letters of credit denominated in dollars and a $300,000,000
sub-limit for aggregate loans in other approved currencies, including Australian dollars, Hong Kong dollars, Singapore dollars and Japanese yen.

The interest rate applicable to any loan granted in WE Dollars (other than swing line loans) are, at Avnet’s discretion, one of (i) “base rates” (defined as the greater of (i) the federal funds rate plus 0.50%, (ii) the Bank of America Prime Rate, (iii) the term Secured Overnight Funding Rate (“SOFR”) (as defined in the Second Amended Credit Agreement) plus 1, 00% or (iv) 1.00%) plus an “applicable rate” (based on debt rating by Moody’s Investors Service, Inc.,
Standard & Poor’s Financial Services LLC Where Fitch, Inc. of Avnet’s senior unsecured long-term debt, not enhanced by the credit), (ii) the SOFR daily floating rate plus an “applicable rate” or (iii) the forward SOFR rate plus an “applicable rate “. The interest rate for a loan denominated in any other currency, for a swing line loan or for a letter of credit is determined as specified in the second amended credit agreement. In certain circumstances, including while certain events of default exist, the applicable interest rate may be increased by 2.00% per annum.

Avnet’s ability to borrow under the Second Amended Credit Agreement is subject to certain conditions, including compliance with certain covenants and the making of certain representations and warranties. Failure to perform any of the covenants or the occurrence of other specified events that constitute an event of default could result in an acceleration of Avnet’s repayment obligations under the second amended credit agreement.

Avnet guaranteed the obligations of Avnet Europe under the second amended credit agreement. Avnet’s other subsidiaries may become borrowers under the Second Amended Credit Agreement, subject to certain conditions, including Avnet’s guarantee of such subsidiary borrower’s obligations.

The description of the Second Amended Credit Agreement set forth above is only a summary of its material terms and does not purport to be complete, and is qualified in its entirety by reference to the full and complete terms contained in the Second Amended Credit Agreement. Amended Credit, which is filed as Exhibit 10.1 to this Form 8-K and incorporated into this Section 1.01 by reference. The Second Amended Credit Agreement is not intended to be a source of factual, business or operational information about Avnet or its affiliates. The representations, warranties and covenants contained in the Second Amended Credit Agreement were made solely for the purposes of this agreement and as of specific dates, were solely for the benefit of the parties to this agreement and may be subject to any limitations agreed to by the parties. , including being qualified by disclosures for the purpose of allocating contractual risk between the parties instead of establishing the facts as such; and may be subject to materiality standards applicable to contracting parties that differ from those applicable to investors or securityholders. Accordingly, investors should not rely on representations, warranties and covenants or any description thereof as characterizations of the true state of the facts or the condition of the parties.

Some or all of the parties to the Second Amended Credit Agreement, or their affiliates, have in the past provided investment or commercial banking services to Avnet and its affiliates for which they have received customary fees and expenses and may provide similar services in the future.

Item 2.03 Creation of a Direct Financial Obligation or Obligation Under an Off-Balance Sheet Arrangement of a Registrant.

The disclosure required below is provided in 1.01 above and is incorporated herein by reference.


Item 9.01  Financial Statements and Exhibits.



(d) Exhibits.



Exhibit
Number     Description

  10.1       Second Amended and Restated Credit Agreement dated as of August 2, 2022

104        Cover Page Interactive Data File (embedded within the Inline XBRL document).

© Edgar Online, source Previews

Comments are closed.