Section 1.01 Entering into a Material Definitive Agreement.
At March 17, 2022, Brown & Brown, Inc. (the “Company”) completed the issue and sale of $600,000,000 the aggregate principal amount of the Company’s 4.200% Senior Notes due 2032 (the “2032 Notes”) and $600,000,000 aggregate principal amount of the Company’s 4.950% senior bonds due 2052 (the “2052 Bonds” and, together with the 2032 Bonds, the “Bonds”). The net proceeds to the Company from the sale of the Notes, after deducting underwriting discounts and estimated offering costs, were approximately $1,178.2 million.
The Notes have been offered and sold pursuant to the Company’s automatic registration statement on Form S-3 (registration number 333-248587) filed with the Security and Exchange Commission (the “SEC”) on September 3, 2020 (the “Registration Statement”). In connection with the issuance and sale of the Notes, the Company has entered into a bought deal agreement, dated March 14, 2022with JP Morgan Securities LLC, BofA Securities, Inc., BMO Capital Markets Corp. and
Trust Securities, Inc.as representatives of the several underwriters named therein, which was filed as an exhibit to the company’s current report on Form 8-K filed with the SECOND to March 15, 2022.
The Notes have been issued pursuant to this Indenture, dated September 18, 2014between the company and US Bank Trust Company, National Association
(as successor to National Association of American Banks), as Trustee (the “Basic Indenture”), as supplemented by the Fourth Supplemental Indenture, dated March 17, 2022 (the “Supplemental Trust Indenture” and, together with the Base Trust Indenture, the “Trust Indenture”). The Supplemental Indenture is filed as Exhibit 4.2 to this Current Report on Form 8-K and is incorporated herein by reference.
Information regarding the Notes and related matters is set forth in the registration statement, including the Company’s Prospectus and Prospectus Supplement, which Prospectus Supplement has been filed with the SECOND to March 15, 2022.
The 2032 Bonds bear interest at the rate of 4.200% per annum and will mature on
March 17, 2032. Interest on the 2032 Bonds will be payable semi-annually in arrears on the 17th of March and September 17 of each year, from September 17, 2022. The 2052 Bonds bear interest at the rate of 4.950% per annum and will mature on March 17, 2052. Interest on the 2052 Bonds will be payable semi-annually in arrears on the 17th of March and September 17 of each year, from September 17, 2022. The Notes are senior unsecured obligations of the Company and will have a right of payment equal to all existing and future senior unsecured indebtedness of the Company. The Company may redeem the Notes in whole or in part at any time and from time to time at the “full” redemption prices specified in the Prospectus Supplement for redeemed Notes, plus accrued and unpaid interest thereon to redemption, but excluding it. Dated. If we do not consume the acquisition of GRP (Jersey) Holdco Limited and its business (the “GRP Acquisition”) no later than December 31, 2022 or, if prior to such date, we notify the Trustee in writing that the majority share purchase agreement relating to the acquisition of GRP (“GRP Acquisition Agreement”) is terminated, then, in either case, we must redeem all 2032 Bonds at a redemption price equal to 101% of the principal amount of the Notes plus accrued and unpaid interest up to, but not including, the special mandatory redemption date. The 2052 Notes are not subject to the special mandatory redemption provision and will remain outstanding even if the acquisition of GRP is not completed by December 31, 2022. The Form of Note for the 2032 Notes and the 2052 Notes is filed as Exhibits 4.3 and 4.4, respectively, to this Current Report on Form 8-K and is incorporated by reference herein. The Company intends to use the net proceeds from the issuance of the Notes, together with borrowings under its revolving credit facility, cash and other borrowings, to fund the cash consideration and other amounts payable under the GRP Acquisition Agreement and to pay the fees and expenses related to the foregoing. If the Acquisition of GRP is not completed at the latest December 31, 2022the Company plans to use the net proceeds from the sale of the 2052 tickets for general corporate purposes.
The Indenture contains certain restrictive covenants, including covenants that limit the ability of the Company and certain of its subsidiaries, among other things, to incur certain secured indebtedness and to consolidate, merge or transfer substantially all of the assets of the Company to another entity. The Covenants are subject to a number of important exceptions and qualifications set forth in the Indenture. The Indenture also contains a covenant relating to the Company’s redemption of the Notes upon a “Change of Control Triggering Event”.
The foregoing description of the Indenture and the Notes is entirely subject to their respective terms. The Base Indenture, Supplemental Indenture and Forms of Notes are filed as exhibits to this Current Report on Form 8-K and are incorporated herein by reference.
As part of the issuance of Notes, Holland & Knight LLPBoard of the Company, issued an opinion to the Company, dated March 17, 2022, regarding the legality of the Notes when issued and sold. A copy of the opinion is filed as Exhibit 5.1 to this Current Report on Form 8-K and is incorporated by reference into the Registration Statement.
Item 2.03 Creation of a Direct Financial Obligation or Obligation Under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth in Section 1.01 of this Current Report on Form 8-K is incorporated by reference into this Section 2.03. ————————————————– ——————————
Item 9.01 Financial statements and supporting documents.
The following documents are filed herewith:
Exhibit No. Description of Exhibit
4.1 Indenture, dated as of September 18, 2014, between Brown
& Brown, Inc. and U.S. Bank Trust Company, National
Association (as successor to U.S. Bank National
Association) (incorporated by reference to Exhibit 4.1 to
Form 8-K filed on September 18, 2014).
4.2 Fourth Supplemental Indenture, dated as of March 17,
2022, between Brown & Brown, Inc. and U.S. Bank Trust
Company, National Association (as successor to U.S. Bank
4.3 Form of Brown & Brown, Inc.'s 4.200% Notes due 2032.
4.4 Form of Brown & Brown, Inc.'s 4.950% Notes due 2052.
5.1 Opinion of Holland & Knight LLP.
23.1 Consent of Holland & Knight LLP (included as part of
104 Cover Page Interactive Data File (formatted as inline
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