Nike Inc. filed SEC Form 8-K: Entry into a Material Definitive Agreement, Termination of a Material Definitive Agreement, Creation of a Direct Financial Obligation, Financial Statements and Exhibits
$NKE
Shoe Manufacturing
Consumer Discretionary
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
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Item 1.01 Entry into a Material Definitive Agreement
364-Day Credit Facility
On March 8, 2024, NIKE, Inc. (the “Company”) entered into a Credit Agreement with Bank of America, N.A., as administrative agent, and the other financial institutions named therein as lenders (the “364‑Day Credit Agreement”). The 364‑Day Credit Agreement provides for up to $1.0 billion of borrowings pursuant to a 364-day unsecured revolving credit facility (the “364‑Day Credit Facility”), which is available for working capital and general corporate purposes, including supporting the issuance of commercial paper. In addition to loans in U.S. Dollars, borrowings under the 364‑Day Credit Facility will be available in Canadian Dollar, Euro, Sterling, Yen and any other currency that is freely convertible into U.S. Dollars and agreed to by the administrative agent and the then existing lenders. The 364-Day Credit Facility matures on March 7, 2025, assuming the maturity date is not extended.
The Company may, upon the agreement of either of the then existing lenders or of additional banks not currently party to the 364-Day Credit Agreement, increase the commitments under the 364-Day Credit Facility to up to $1.5 billion. The Company may also request renewal of the 364‑Day Credit Facility for an additional 364-day period or convert any amounts outstanding into a term loan for a period of up to one year, which term loan would mature no later than the anniversary of the then effective termination date.
As of March 8, 2024, the Company is the only borrower under the 364-Day Credit Facility. However, the 364‑Day Credit Agreement allows for the Company to designate additional subsidiary borrowers from time to time. In the event that any subsidiary of the Company becomes a borrower, the Company has agreed to provide a guarantee in respect of any such subsidiary’s obligations in relation with the revolving credit facility.
Borrowings under the 364-Day Credit Facility will bear interest, at the Company’s option, at either (a) Term SOFR plus 0.10% plus an applicable margin or (b) a base rate defined as the highest of (i) the Bank of America “prime rate”, (ii) the federal funds effective rate plus 0.50% and (iii) one month Term SOFR plus 1.00%. The applicable margin for Term SOFR loans will range from 0.3575% to 0.690% based on the public ratings of the Company’s long-term, senior unsecured, non-credit enhanced indebtedness for borrowed money. The Company may select interest periods of one, three or six months for Term SOFR loans, subject to availability. Interest shall be payable at the end of the selected interest period, but no less frequently than quarterly.
The 364-Day Credit Agreement contains covenants that, among other things, limit or restrict the ability of the Company and its subsidiaries to incur additional liens; engage in mergers, acquisitions and dispositions; and use proceeds of loans under the 364-Day Credit Facility. The 364‑Day Credit Agreement does not include any financial covenants.
Documentation
The description of the 364-Day Credit Agreement is qualified in its entirety by reference to the 364-Day Credit Agreement filed as Exhibit 10.1 and incorporated herein by reference.
Item 1.02 Termination of a Material Definitive Agreement
Termination of Prior 364-Day Credit Agreement
On March 8, 2024, concurrently with the Company’s entry into the 364-Day Credit Agreement described in Item 1.01 hereof, the Company terminated the existing Credit Agreement dated March 10, 2023, which provided for up to $1.0 billion of borrowings in U.S. Dollars pursuant to a 364‑day unsecured revolving credit facility, with the banks, financial institutions and other lenders signatory thereto (the “Prior 364‑Day Credit Agreement”). The Prior 364‑Day Credit Agreement contained covenants that, among other things, limited or restricted the ability of the Company and its subsidiaries to incur additional liens; engage in mergers, acquisitions and dispositions; engage in transactions with affiliates; and use proceeds of loans under the Prior 364-Day Credit Agreement. The Prior 364‑Day Credit Agreement did not include any financial covenants. No amounts were outstanding under this facility as of March 8, 2024. The Prior 364‑Day Credit Agreement would have expired on March 8, 2024.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation Under and Off-Balance Sheet Arrangement
The information contained in Item 1.01 of this current report on Form 8-K is by this reference incorporated in this Item 2.03.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Exhibit | ||||
| 10.1 | |||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | ||||
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.
| NIKE, Inc. (Registrant) | |||||||||||
| Date: | March 11, 2024 | By: | /s/ Matthew Friend | ||||||||
| Matthew Friend | |||||||||||
| Executive Vice President and Chief Financial Officer | |||||||||||