| Item 1.01. |
Entry into a Material Definitive Agreement. |
Senior Notes
On August 22, 2024, CDW LLC, an Illinois limited liability company (“CDW”), and CDW Finance Corporation, a Delaware corporation (“CDW Finance” and, together with CDW, the “Co-Issuers”), completed the sale of $600,000,000 aggregate principal amount of 5.100% Senior Notes due 2030 (the “2030 Notes”) at an issue price of 99.889% of the principal amount of the 2030 Notes and $600,000,000 aggregate principal amount of 5.550% Senior Notes due 2034 (the “2034 Notes” and, together with the 2030 Notes, the “Notes”) at an issue price of 99.742% of the principal amount of the 2034 Notes in an offering registered under the Securities Act of 1933, as amended (the “Securities Act”). The 2030 Notes mature on March 1, 2030 and bear interest at 5.100% per annum, payable semi-annually on March 1 and September 1 of each year. The 2034 Notes mature on August 22, 2034 and bear interest at 5.550% per annum, payable semi-annually on February 22 and August 22 of each year. Interest will accrue from August 22, 2024 for each of the Notes, and the first interest payment date will be March 1, 2025 for the 2030 Notes and February 22, 2025 for the 2034 Notes.
Indentures
The Notes were issued pursuant to an indenture (the “Base Indenture”), dated as of December 1, 2014, among the Co-Issuers, the guarantors party thereto, including CDW Corporation (the “Company”), and U.S. Bank National Association, as trustee, as supplemented by (i) an eighteenth supplemental indenture, dated as of August 22, 2024, entered into among the Co-Issuers, the guarantors party thereto (the “Guarantors”), including the Company, and U.S. Bank Trust Company, National Association, as successor in interest to U.S. Bank National Association (the “Trustee”), to reflect certain terms of the 2030 Notes (the “Eighteenth Supplemental Indenture”), and (ii) a nineteenth supplemental indenture, dated as of August 22, 2024, entered into among the Co-Issuers, the Guarantors and the Trustee, to reflect certain terms of the 2034 Notes (the “Nineteenth Supplemental Indenture” and, together with the Eighteenth Supplemental Indenture, the “Supplemental Indentures”). References herein to the “Indenture” shall mean the Base Indenture as supplemented by the Supplemental Indentures (as applicable).
The Co-Issuers may redeem the Notes, in whole or in part, at any time prior to the applicable par call date at a redemption price equal to the greater of (1) (a) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date (assuming the notes matured on the applicable par call date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the treasury rate plus 25 basis points, in the case of the 2030 Notes, and 30 basis points, in the case of the 2034 Notes, less (b) interest accrued to the date of redemption, and (2) 100% of the principal amount of the notes to be redeemed, plus, in either case, accrued and unpaid interest thereon to the redemption date. The par call date for the 2030 Notes is February 1, 2030, and the par call date for the 2034 Notes is May 22, 2034. On or after the par call date, the Co-Issuers may redeem the Notes, in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount of the Notes being redeemed plus accrued and unpaid interest thereon to the redemption date. If the Company experiences certain change of control events and a related downgrade in the credit rating of the Notes, holders of the Note may require the Co-Issuers to repurchase all or part of the Notes at 101% if their principal amount plus accrued and unpaid interest to, but not including, the repurchase date.
The Indenture contains covenants that, among other things, limit the ability of CDW and the Guarantors to create liens on certain assets to secure debt, enter into sale and lease-back transactions and consolidate, merge, sell or otherwise dispose of all or substantially all assets. These covenants are subject to a number of other limitations and exceptions as set forth in the Indenture.
The Indenture also provides for customary events of default, including failure to pay any principal or interest when due and failure to comply with covenants and cross-acceleration provisions. In the case of an event of default arising from specified events of bankruptcy or insolvency, all outstanding Notes will become due and payable immediately without further action or notice. If any other event of default under the Indenture occurs or is continuing, the Trustee, acting at the written direction of the holders of at least 25% of the aggregate principal amount of the outstanding Notes of a series may declare all of the Notes of such series to be due and payable immediately.
