Item 8.01. Other Events.
On February 26, 2020, W.W. Grainger, Inc. (the "Company") issued $500 million of
its 1.85% Senior Notes due 2025 (the "Notes") upon completion of a public
offering. The Notes were issued pursuant to an indenture, dated as of June 11,
2015, as supplemented by a fourth supplemental indenture, dated as of February
26, 2020, between the Company and U.S. Bank National Association, as trustee.
The Notes are senior unsecured obligations of the Company and will mature on
February 15, 2025. Interest on the Notes is payable semi-annually in arrears on
February 15 and August 15 of each year, beginning on August 15, 2020.
Prior to January 15, 2025, the Company may redeem the Notes in whole or in part
at any time and from time to time at a "make-whole" redemption price calculated
by reference to the then current yield on a US treasury security with a maturity
comparable to the remaining term of the Notes plus 10 basis points, together
with accrued and unpaid interest, if any, to, but excluding, the redemption
date. On or after January 15, 2025, the Company may redeem the Notes in whole or
in part at any time and from time to time at 100% of their principal amount,
together with accrued and unpaid interest thereon, if any, to, but excluding,
the redemption date. Additionally, if the Company experiences specific kinds of
changes of control, it will be required to make an offer to purchase the Notes
at 101% of their principal amount plus accrued and unpaid interest thereon, if
any, to, but excluding, the date of purchase.
In connection with the offering of the Notes, the Company entered into an
Underwriting Agreement, dated February 21, 2020 (the "Underwriting Agreement"),
among the Company and BofA Securities, Inc. and J.P. Morgan Securities LLC, as
representatives of the several underwriters named therein (together, the
"Underwriters"). Pursuant to the Underwriting Agreement, the Company agreed to
sell the Notes to the Underwriters, and the Underwriters agreed to purchase the
Notes for resale to the public. The Underwriting Agreement includes customary
representations, warranties and covenants by the Company. It also provides for
customary indemnification by each of the Company and the Underwriters against
certain liabilities and customary contribution provisions in respect of those
liabilities.
The Company intends to use the net proceeds of approximately $494.7 million
(after deducting the underwriting discount and estimated offering expenses) from
the offering of the Notes to repay certain indebtedness of its subsidiaries and
the remainder for general corporate purposes, including the repurchase of shares
of the Company's common stock pursuant to its share repurchase program.
Exhibits are filed herewith in connection with the Registration Statement on
Form S-3 (Registration No. 333-236530), filed with the Securities and Exchange
Commission on February 20, 2020, relating to the Notes offered pursuant to the
Prospectus Supplement, dated February 21, 2020.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. Description of Exhibit
1.1 Underwriting Agreement, dated as of February 21, 2020, among W.W.
Grainger, Inc. and BofA Securities, Inc. and J.P. Morgan Securities
LLC, as representatives of the underwriters named therein.
4.1 Fourth Supplemental Indenture, dated as of February 26, 2020,
between W.W. Grainger, Inc., and U.S. Bank National Association, as
trustee.
4.2 Form of 1.85% Senior Notes due 2025 (included in Exhibit 4.1).
5.1 Opinion of Baker & McKenzie LLP, counsel for W.W. Grainger, Inc.,
as to the validity of the Notes.
23.1 Consent of Baker & McKenzie LLP (included in Exhibit 5.1).
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
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