W.W. Grainger 8-K Shows Co Entered Agreement For Terms Loans & Revolving Credit Lines With Lloyds Bank

As previously disclosed, on July 30, 2015, W.W. Grainger, Inc., an Illinois corporation ("Grainger"), and GWW UK Holdings Ltd, a company incorporated and registered in England and Wales and an indirect, wholly owned subsidiary of Grainger ("Purchaser"), entered into an Agreement (the "Purchase Agreement") with Gregory Family Office Limited, a company incorporated and registered in England and Wales ("Seller"), and Michael Gregory, pursuant to which Purchaser agreed to purchase all of the issued share capital (the "Shares") of Cromwell Group (Holdings) Limited, a company incorporated and registered in England and Wales ("Cromwell"), from Seller (the "Acquisition"). The Acquisition closed on September 1, 2015, upon which Cromwell became a direct, wholly owned subsidiary of Purchaser. In connection with the Acquisition, on August 26, 2015, Grainger and Purchaser entered into a Facilities Agreement (the "Facilities Agreement") with Lloyds Bank PLC and Lloyds Securities Inc., as mandated lead arrangers, Lloyds Bank PLC acting as agent (the "Agent"), and the financial institutions listed on Schedule 1 thereto (the "Lenders"). The Facilities Agreement provides for term loans of £160,000,000 ("Facility A") and revolving credit facilities of up to £20,000,000 ("Facility B" and together with Facilities A, the "Loans"). The Purchaser used the proceeds of Facility A to pay (a) to Seller a portion of the purchase price for the Shares due under the Purchase Agreement and (b) certain costs related to the Acquisition. Upon the consummation of the Acquisition, Cromwell became an additional borrower under the Facilities Agreement (together with Purchaser, the "Borrowers" and, each individually, a "Borrower") and has the right to obtain advances under Facility B. The Borrowers intend to use the proceeds of Facility B for general corporate and working capital purposes. The principal amount of Facility A will be repaid in installments of £4,000,000 payable on the last days of February and August commencing February 29, 2016 through and including February 29, 2020 with any remaining outstanding principal amount being due and payable on the fifth anniversary of the date of the Facilities Agreement. Facility B must be generally repaid at the conclusion of each interest period set forth in the Facilities Agreement, except as otherwise provided in the Facilities Agreement. The Loans will initially bear interest at the London Interbank Offered Rate set forth in the Facilities Agreement plus a margin (the "Margin") of 0.75% per annum. At any time after the date of the Facilities Agreement, the Margin may be adjusted within a range of 0.75% to 3.0% per annum depending on the unsecured non-credit enhanced long-term funded debt rating of Grainger. The Loans may be prepaid, at any time, in whole or in part without premium or penalty. The Facilities Agreement is unsecured. The obligations of the Borrowers under the Facilities Agreement are unconditionally guaranteed by Grainger. The Facilities Agreement contains customary representations and warranties and customary affirmative and negative covenants for agreements of this type. Such covenants include delivery of financial information, notification of certain defaults and adverse events, as well as notification of any change to Grainger's debt ratings, compliance with certain "know your customer" requirements of the Agent and the Lenders, preservation of corporate existence, maintenance of property and insurance, payment of taxes and other obligations, compliance with law, compliance with ERISA, maintenance of books and records and rights of the Agent and the Lenders to inspect books and records, compliance with environmental laws, compliance with the PATRIOT Act and sanctions laws and regulations, undertaking of the Loans to rank at least pari passu with other obligations, limitations on security, disposal of assets, consolidations and mergers, loans and investments, subsidiary indebtedness, transactions with affiliates, use of proceeds, ERISA violations, change in business, subsidiary dividends and modifications to documentation related to the Acquisition.