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): November 28, 2005
Paxar Corporation
(Exact name of registrant as specified in its charter)
New York 1-9493 13-5670050
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
105 Corporate Park Drive
White Plains, New York 10604
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (914) 697-6800
Not Applicable
(Former name or former address, if changed since last report)
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:
|_| 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))
Item 1.01 Entry into a Material Definitive Agreement
On November 28, 2005, Paxar Corporation (the "Company") and certain of its
subsidiaries entered into a five-year, $150 million credit agreement (the
"Credit Agreement") with the lenders named in the Credit Agreement
(collectively, the "Lenders") and the administrative agent for the Lenders. The
Company plans to use a portion of the proceeds of the Credit Agreement, together
with domestic cash on hand and intra-company payments, to repay and cancel by
December 31 2005, its $150 million outstanding 6.74% Senior Notes due 2008.
Under the Credit Agreement, the Company will pay a facility fee on the aggregate
amount of each Lender's credit commitment at a rate determined by reference to
the ratio of debt to earnings before interest, taxes, depreciation and
amortization ("EBITDA"). Borrowings under the Credit Agreement will bear
interest at prime rate, negotiated rates, London Interbank Offered Rate
("LIBOR") or Euro LIBOR, at the Company's option, with applicable margins that
vary in accordance with the Company's attainment of specified debt to EBITDA
thresholds, and are guaranteed by the Company's domestic subsidiaries.
The Credit Agreement, among other things, limits the Company's and its
subsidiaries' (as therein defined) ability to (i) change the nature of its
business, (ii) create liens, (iii) engage in mergers and consolidations, (iv)
incur indebtedness, (v) sell, lease, transfer or otherwise dispose of assets,
and (vi) make certain investments in other persons and instruments.
In addition, the Credit Agreement contains certain events of default, which
generally give the Lenders the right to accelerate payments of outstanding debt.
These events include: (i) failure to make a payment of principal, interest or
fees within two days of its due date; (ii) default, beyond any applicable grace
period, on any aggregate indebtedness of at least $500,000; (iii) judgment or
order involving liability in excess of $500,000; (iv) non-monetary judgment or
order reasonably expected to have a material adverse effect; (v) occurrence of
certain events constituting a change of control of the Company; and (vi)
non-compliance with certain financial covenant ratios, as described in part
below.
The Credit Agreement requires the Company to maintain at all times an
excess of consolidated total assets over total liabilities of not less than the
sum of $350 million and 35% of its consolidated net income. The Company's
maximum allowable debt to EBITDA ratio is 3.0 to 1.
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.
PAXAR CORPORATION
(Registrant)
Date: December 1, 2005 By: /s/ Robert S. Stone
-------------------------------
Robert S. Stone
Vice President, General Counsel
and Secretary