Tapestry Inc. filed SEC Form 8-K: Entry into a Material Definitive Agreement, Termination of a Material Definitive Agreement, Events That Accelerate or Increase a Direct Financial Obligation, Regulation FD Disclosure, Other Events, Financial Statements and Exhibits

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

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:

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Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01

Entry into a Material Definitive Agreement.

The disclosure set forth below under Item 1.02 of this Current Report on Form 8-K is incorporated by reference herein.

The Company’s Term Loan Agreement, dated as of August 30, 2023, among the Company, Bank of America N.A., as administrative agent, and the financial institutions parties thereto as lenders (the “Term Loan Agreement”) and all commitments thereunder were terminated concurrently with the effectiveness of the Termination Agreement.

The foregoing descriptions of the Merger Agreement, the Termination Agreement and the Term Loan Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Merger Agreement, which was filed as an exhibit to the Company’s Current Report on Form 8-K filed on August 10, 2023, the Termination Agreement, which is attached hereto as Exhibit 10.1 and the Term Loan Agreement, which was filed as an exhibit to the Company’s Current Report on Form 8-K filed on September 1, 2023, each of which is incorporated by reference herein.

Pursuant to the terms of the Indenture (the “Base Indenture”), dated as of December 21, 2021, between the Company and U.S. Bank Trust Company, National Association (as successor in interest to U.S. Bank National Association), as trustee (the “Trustee”), as supplemented by: (i) with respect to the Company’s €500,000,000 aggregate principal amount of 5.350% senior unsecured notes due 2025 (the “2025 EUR Notes”), €500,000,000 aggregate principal amount of 5.375% senior unsecured notes due 2027 (the “2027 EUR Notes”) and €500,000,000 aggregate principal amount of 5.875% senior unsecured notes due 2031 (the “2031 EUR Notes” and, together with the 2025 EUR Notes and the 2027 EUR Notes, the “EUR Notes”), the Third Supplemental Indenture, dated as of November 27, 2023, among the Company, the Trustee, and Elavon Financial Services DAC, UK Branch, as paying agent (together with the Base Indenture, the “EUR Indenture”); and (ii) with respect to the Company’s $500,000,000 aggregate principal amount of 7.050% senior unsecured notes due 2025 (the “2025 USD Notes”), $750,000,000 aggregate principal amount of 7.000% senior unsecured notes due 2026 (the “2026 USD Notes”), $1,000,000,000 aggregate principal amount of 7.350%  senior unsecured notes due 2028 (the “2028 USD Notes”), $1,000,000,000 aggregate principal amount of 7.700% senior unsecured notes due 2030 (the “2030 USD Notes”) and $1,250,000,000 aggregate principal amount of 7.850% senior unsecured notes due 2033 (the “2033 USD Notes” and, together with the 2025 USD Notes, the 2026 USD Notes, the 2028 USD Notes and the 2030 USD Notes, the “USD Notes” and, together with the EUR Notes, the “Notes”), the Second Supplemental Indenture, dated as of November 27, 2023, between the Company and the Trustee (together with the Base Indenture, the “USD Indenture”), the Company is required, due to the termination of the Merger Agreement, to redeem all outstanding Notes.  The 2025 EUR Notes are listed on the New York Stock Exchange (the “NYSE”) under the symbol TPR25A, the 2027 EUR Notes are listed on the NYSE under the symbol TPR27A and the 2031 EUR Notes are listed on the NYSE under the symbol TPR31.

The redemption price for the Notes will be 101% of the aggregate principal amount of such Notes, plus accrued and unpaid interest to, but excluding, the date of redemption. Pursuant to the terms of each of the EUR Indenture and the USD Indenture, the Company will provide notice of the special mandatory redemption to holders of the EUR Notes and USD Notes, respectively, with a copy to the Trustee on the Termination Date. The date of redemption will be on or about November 25, 2024. The Company expects to fund the redemption of the Notes with cash on hand. As a result of the redemption of the Notes, in the second fiscal quarter of 2024, the Company will recognize, on a pre-tax basis, in its net income the entire approximately $57.1 million unamortized portion of the related cash flow hedge losses, debt issuance costs and debt issuance discounts and the entire approximately $61.1 million redemption premium paid on the Notes upon such redemption.

The paying agent for the EUR Notes is Elavon Financial Services DAC, UK Branch located at 125 Old Broad Street, Fifth Floor, London EC2N 1AR, United Kingdom, and the paying agent for the USD Notes is U.S. Bank Trust Company, National Association, located at 100 Wall Street, Suite 600, New York, NY 10005.

The information included under this Item 7.01 (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as may be expressly set forth by specific reference in such filing.

On November 13, 2024, the board of directors of the Company (the “Board”) authorized the Company to repurchase up to $2.0 billion of outstanding shares of its common stock, $0.01 par value per share, pursuant to a new share repurchase program. Under the share repurchase program, the Company may repurchase shares on the open market, in privately negotiated transactions or in other transactions, including accelerated share repurchase programs. The Company intends to launch an accelerated share repurchase program in the coming weeks and expects to fund it with cash on hand and proceeds from debt, which may include borrowings under its revolving credit facility, borrowings under a new term loan facility or the issuance of new debt. The $2.0 billion authorized for purchases under the new repurchase program is supplemental to the $800 million remaining in authorized purchases under the share repurchase program authorized by the Board in May 2022.

Forward-Looking Statements

This Current Report on Form 8-K may contain forward-looking statements based on management’s current expectations. Forward-looking statements include, but are not limited to, statements regarding the Company’s capital deployment plans, including anticipated share repurchase plans, and statements that can be identified by the use of forward-looking terminology such as “may,” “can,” “if,” “continue,” “assume,” “should,” “expect,” “confidence,” “goals,” “trends,” “anticipate,” “intend,” “estimate,” “on track,” “future,” “plan,” “deliver,” “potential,” “position,” “believe,” “will,” “target,”  “guidance,” “forecast,” “outlook,” “commit,” “leverage,” “generate,” “enhance,”  “innovation,” “drive,” “effort,” “progress,” “confident,”  “uncertain,” “achieve,” “strategic,”  “growth,” “proposed acquisition,” “we can stretch what’s possible,” similar expressions, and variations or negatives of these words. Future results may differ materially from management’s current expectations, based upon a number of important factors, including risks and uncertainties such as the impact of economic conditions, recession and inflationary measures, risks associated with operating in international markets and our global sourcing activities, the ability to anticipate consumer preferences and retain the value of our brands, including our ability to execute on our e-commerce and digital strategies, the ability to successfully implement the initiatives under our 2025 growth strategy, the effect of existing and new competition in the marketplace, the effect of seasonal and quarterly fluctuations on our sales or operating results, the risk of cybersecurity threats and privacy or data security breaches, our ability to satisfy our outstanding debt obligations or incur additional indebtedness, the risks associated with climate change and other corporate responsibility issues, the impact of tax and other legislation, the risks associated with potential changes to international trade agreements and the imposition of additional duties on importing our products, our ability to protect against infringement of our trademarks and other proprietary rights, and the impact of pending and potential future legal proceedings, etc. In addition, purchases of shares of the Company’s common stock will be made subject to market conditions and at prevailing market prices. Please refer to the Company’s latest Annual Report on Form 10-K, latest Quarterly Report on Form 10-Q and its other filings with the Securities and Exchange Commission for a complete list of risks and important factors. The Company assumes no obligation to revise or update any such forward-looking statements for any reason, except as required by law.

(d) Exhibits

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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