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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) January 27, 2006
OIL-DRI CORPORATION OF AMERICA
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(Exact name of registrant as specified in its charter)
Delaware 0-8675 36-2048898
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(State or other jurisdiction of (Commission File (IRS Employer
incorporation) Number) Identification No.)
410 North Michigan Avenue
Suite 400
Chicago, Illinois 60611-4213
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (312) 321-1515
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(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 (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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ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
NEW CREDIT AGREEMENT. On January 27, 2006, Oil-Dri Corporation of America
("Oil-Dri" or the "Company") and certain of its subsidiaries as guarantors
entered into an unsecured revolving credit agreement (the "Credit Agreement")
with Harris N.A. (the "Bank"), pursuant to which the Company may borrow from the
Bank up to fifteen million dollars ($15,000,000) from time to time. The Credit
Agreement provides that the Company may select either a variable rate based on
Harris' prime rate from time to time plus a margin which varies depending on the
Company's debt to earnings ratio, a LIBOR-based rate plus a margin which varies
depending on the Company's debt to earnings ratio, or a fixed rate as agreed
between the Company and the Bank. The Company's payment obligations under the
Credit Agreement are guaranteed fully and unconditionally by Oil-Dri Corporation
of Georgia, Oil-Dri Production Company, Oil-Dri Corporation of Nevada, Mounds
Production Company, LLC, Mounds Management, Inc., Blue Mountain Production
Company, and Taft Production Company, each of which is a subsidiary of the
Company. The Credit Agreement replaces the prior credit agreement between the
Company, certain of its subsidiaries as guarantors, and a predecessor of the
Bank, which had been entered into as of January 29, 1999. Unless terminated
earlier in accordance with its terms, the Credit Agreement will expire January
27, 2009.
The Credit Agreement contains certain covenants that restrict the Company's
ability and the ability of certain of the Company's subsidiaries to, among other
things, (i) incur liens, (ii) incur indebtedness, (iii) merge or consolidate,
(iv) sell assets, (v) sell stock of those certain subsidiaries, (vi) engage in
business that would change the general nature of the business engaged in by the
Company, (vii) enter into transactions other than on "arm's length" terms with
affiliates, and (viii) limits annual capital expenditures. In addition, the
Credit Agreement requires the Company to maintain a minimum fixed coverage ratio
and minimum consolidated net worth. These limitations are subject to a number of
important qualifications and exceptions.
Upon the occurrence of certain Events of Default (as defined in the Credit
Agreement) relating to the Company's default in the payment of any principal
amount or other fees or obligations of the Company when due or payable for more
than five business days after the interest becomes due or payable, the Bank may
declare at its option, by notice in writing to the Company, all principal and
interest outstanding under any loans under the Credit Agreement, together with
certain other obligations of the Company to the Bank, immediately due and
payable. Upon the occurrence of certain Events of Default relating to orders for
relief under bankruptcy or similar law, or the appointment of a custodian
regarding a substantial part of assets, in respect of the Company or a
significant subsidiary group, all principal and interest outstanding under any
loans under the Credit Agreement together with certain other obligations of the
Company to the Bank will become immediately due and payable.
This summary description of the Credit Agreement and the guarantees thereof is
qualified in its entirety by reference to the full and complete terms thereof
contained in the Credit Agreement filed as Exhibit 10.1 hereto.
THIRD AMENDMENT TO NOTE AGREEMENT. Additionally, on January 27, 2006, Oil-Dri
Corporation of America ("Oil-Dri" or the "Company") entered into a third
amendment ("3rd Amendment") to its existing Note Purchase Agreement dated as of
April 15, 1998 regarding its $25,000,000 6.55% Senior Notes due April 15, 2013
(the "Note Agreement") among the Company and the Teachers Insurance and Annuity
Association Of America and the Prudential Retirement Insurance and Annuity
Company as noteholders thereunder (the "Noteholders"). Pursuant to the 3rd
Amendment, the Noteholders agreed to modify the definition of Priority Debt
under the Note Agreement to exclude from that definition and related
restrictions under the Note Agreement certain guarantees of debt of the Company
made by subsidiaries of the Company, where those subsidiaries were also
guarantors of the payment obligations of the Company under the Credit Agreement.
In connection with the 3rd Amendment, Oil-Dri Corporation of Georgia, Oil-Dri
Production Company, Oil-Dri Corporation of Nevada, Mounds Production Company,
LLC, Mounds Management, Inc., Blue Mountain Production Company, and Taft
Production Company, each of which is a subsidiary of the Company, entered into
guaranty agreements to fully and unconditionally guaranty the Company's payment
obligations under the Note Agreement.
This summary description of the Note Agreement and the guarantees thereof is
qualified in its entirety by reference to the full and complete terms thereof
contained in the Note Agreement filed as Exhibit 10.2 hereto.
ITEM 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN
OFF-BALANCE SHEET Arrangement of a REGISTRANT.
See the discussion under Item 1.01 above, which discussion is incorporated by
reference herein.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits
Exhibit
Number Description of Exhibits
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10.1 Credit Agreement dated January 27, 2006, among Oil-Dri
Corporation of America, Oil-Dri Corporation of Georgia,
Oil-Dri Production Company, Oil-Dri Corporation of Nevada,
Mounds Production Company, LLC, Mounds Management, Inc, Blue
Mountain Production Company, and Taft Production Company,
and Harris, N.A. including the form of note attached
thereto.
10.2 Third Amendment dated January 27, 2006 to Note Purchase
Agreement dated as of April 15, 1998 regarding its
$25,000,000 6.55% Senior Notes due April 15, 2013, among
Oil-Dri Corporation of America, Teachers Insurance and
Annuity Association Of America and Prudential Retirement
Insurance and Annuity Company, including the form of
guaranty attached thereto.
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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.
OIL-DRI CORPORATION OF AMERICA
By: /s/ Charles P. Brissman
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Charles P. Brissman
Vice President and General Counsel
Date: February 1, 2006
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Exhibit Index
Exhibit
Number Description of Exhibits
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10.1 Credit Agreement dated January 27, 2006, among Oil-Dri
Corporation of America, Oil-Dri Corporation of Georgia,
Oil-Dri Production Company, Oil-Dri Corporation of Nevada,
Mounds Production Company, LLC, Mounds Management, Inc, Blue
Mountain Production Company, and Taft Production Company,
and Harris, N.A. including the form of note attached
thereto.
10.2 Third Amendment dated January 27, 2006 to Note Purchase
Agreement dated as of April 15, 1998 regarding its
$25,000,000 6.55% Senior Notes due April 15, 2013, among
Oil-Dri Corporation of America, Teachers Insurance and
Annuity Association Of America and Prudential Retirement
Insurance and Annuity Company, including the form of
guaranty attached thereto.
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