- Current report filing (8-K)
May 05 2009 - 10:16AM
Edgar (US Regulatory)
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT PURSUANT
TO
SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date of
Report (Date of earliest event reported): April 30, 2009
CHECKPOINT
SYSTEMS, INC.
(Exact
name of Registrant as specified in its Articles of Incorporation)
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Pennsylvania
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22-1895850
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(State
of Incorporation)
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(IRS
Employer Identification No.)
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101
Wolf Drive, PO Box 188, Thorofare, New Jersey
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08086
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(Address
of principal executive offices)
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(Zip
Code)
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856-848-1800
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(Registrant’s
telephone number, including area code)
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N/A
(Former name or 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):
[ ]
Written communications
pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ]
Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ]
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
[ ]
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
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Section
1 – Registrant’s Business and
Operations
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Item
1.01 Entry Into a Material Definitive
Agreement.
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On April
30, 2009, Checkpoint Systems, Inc. (the “Company”) entered into a $125 million
three-year senior secured multi-currency revolving credit agreement, dated as of
April 30, 2009, among the Company, the various lenders party thereto from time
to time, Wachovia Bank, National Association, as Administrative Agent, Citizens
Bank of Pennsylvania as Syndication Agent, and Wachovia Capital Markets, LLC and
RBS Securities, Inc. as Joint Lead Arrangers (the “Credit
Agreement”).
The
Credit Agreement replaces the Registrant’s current revolving credit facility,
dated March 4, 2005 (the “2005 Facility”), which was more specifically described
in Item 1.01 of the Current Report on Form 8-K dated March 4, 2005, and which
description is incorporated herein by reference. The Company borrowed
$109.4 million under the Credit Agreement on April 30, 2009, and used the
proceeds along with cash on hand to repay all remaining outstanding amounts
under the 2005 Facility.
The
Credit Agreement provides for a revolving commitment of $125 million with a term
of three years from the effective date of April 30, 2009. The Credit Agreement
also includes an expansion option that will allow the Borrower, based on
demonstrated consolidated EBITDA, to request an increase of an additional $50
million to the facility, for a potential total commitment of $175 million. The
Borrower may borrow, prepay without premium or penalty and re-borrow such
revolving loans as long as the sum of the outstanding principal amounts of the
revolving loans is less than the aggregate facility availability.
Borrowings
under the Credit Agreement bear interest at a spread ranging from 2.50% to 3.75%
to LIBOR or, at the Company’s option, at a spread ranging from 1.50% to 2.75% to
the prime rate, and in each case fluctuates in accordance with changes in the
Company’s leverage ratio of consolidated funded debt to EBITDA, as
defined by the Credit Agreement.
The
credit facility contains a $25.0 million sublimit for the issuance of letters of
credit, of which $1.2 million, issued under the 2005 Facility, are
outstanding at March 29, 2009. The Secured Credit Facility also
contains a $15.0 million sublimit for swingline loans. The Company
pays an unused line fee ranging from 0.30% to 0.75% per annum on the unused
portion of the commitment under the Credit Agreement.
Pursuant
to the terms of the Credit Agreement, the Company is subject to requirements
including covenants requiring the maintenance of (i) a maximum total leverage
ratio and (ii) a maximum fixed charge coverage ratio. The Credit
Agreement also contains customary representations and warranties, affirmative
covenants, notice provisions, and events of default, including change of
control, cross-defaults to other debt, and judgment defaults. Certain
wholly-owned subsidiaries of the Company are guarantors of the Company’s
obligations under the Credit Agreement.
The
foregoing description of the Credit Agreement does not purport to be complete
and is qualified in its entirety by reference to the full text of the Credit
Agreement, which is filed as Exhibit 10.1 hereto and is incorporated herein by
reference.
Item
1.02 Termination of a Material Definitive Agreement
The
Company simultaneously terminated its 2005 Facility. The 2005 Facility was
entered into on March 4, 2005, as a $150.0 million five-year senior
unsecured multi-currency revolving credit agreement (“Credit Agreement”) with a
syndicate of lenders. The Credit Agreement replaced the $375.0 million
senior collateralized multi-currency credit facility arranged in
December 1999. Borrowings under the Credit Agreement bore interest rates of
LIBOR plus an applicable margin ranging from 0.75% to 1.75% and/or prime plus
0.00% to 0.50%. The interest rate matrix was based on our leverage ratio of
funded debt to EBITDA, as defined by the Credit Agreement. Under the Credit
Agreement, the Company paid an unused line fee ranging from 0.18% to 0.30% per
annum on the unused portion of the commitment. At March 29, 2009, the Company
had $132.2 million outstanding under this facility.
Item
2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a
Registrant
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The
disclosure provided in Item 1.01 "Entry into a Material Definitive Agreement" is
incorporated by reference into this Item 2.03 as if fully set forth
herein.
Section
9 – Financial Statements and Exhibits.
Item
9.01 Financial Statements and
Exhibits
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(d)
Exhibits
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10.1
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Credit
agreement, dated as of April 30, 2009, among the Company, the various
lenders party thereto from time to time, Wachovia Bank, National
Association, as Administrative Agent, Citizens Bank of Pennsylvania as
Syndication Agent, and Wachovia Capital Markets, LLC and RBS Securities,
Inc.as Joint Lead Arrangers
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99.1
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Press
Release dated May 5, 2009
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Signatures
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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CHECKPOINT
SYSTEMS, INC.
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Date:
May 5, 2009
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By:
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/s/
Raymond D. Andrews
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Title:
Senior Vice President and Chief Financial Officer
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Checkpoint
Systems, Inc.
Index of
Exhibits
Exhibit
Number
Description
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10.1
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Credit
agreement, dated as of April 30, 2009, among the Company, the various
lenders party thereto from time to time, Wachovia Bank, National
Association, as Administrative Agent, Citizens Bank of Pennsylvania as
Syndication Agent, and Wachovia Capital Markets, LLC and RBS Securities,
Inc. as Joint Lead Arrangers
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99.1
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Press
Release dated May 5, 2009
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