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): December 28, 2006
ALEXANDER & BALDWIN, INC.
(Exact name of registrant as specified in its charter)
Hawaii 0-565 99-0032630
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(State or other jurisdiction (Commission File Number) (I.R.S. Employer
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of incorporation) Identification No.)
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822 Bishop Street, P. O. Box 3440
Honolulu, Hawaii 96801
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(Address of principal executive office and zip code)
(808) 525-6611
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(Registrant's telephone number, including area code)
Not Applicable
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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):
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|_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
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|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
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|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
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|_| 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
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The information set forth below in Item 2.03 is incorporated into this
Item 1.01 by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
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Off-Balance Sheet Arrangement of a Registrant
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On December 28, 2006, Alexander & Baldwin, Inc. ( "A&B" or the
"Company"), entered into a Credit Agreement (the "A&B Agreement") with First
Hawaiian Bank ("FHB"), Bank of America, N.A. ("BofA"), Wells Fargo Bank,
National Association ("Wells Fargo"), BNP Paribas, American Savings Bank, F.S.B.
("ASB"), and Bank of Hawaii ("BOH") (collectively, the "Lenders"), for a
$225 million revolving credit facility. Concurrently, Matson Navigation Company,
Inc. ("Matson"), a wholly-owned subsidiary of A&B, entered into a Credit
Agreement (the "Matson Agreement") with the Lenders for a $100 million revolving
credit facility that is linked to the A&B Agreement.
The A&B Agreement supersedes A&B's Second Amendment to Third Amended
and Restated Revolving Credit and Term Loan Agreement dated October 1, 2004 with
FHB, BofA, BOH, The Bank of New York, Wells Fargo, and ASB of $200 million and
A&B's Fourteenth Amendment dated October 31, 2005 to the $78.5 million Revolving
Credit Agreement between A&B and FHB, dated December 30, 1993, as amended. The
Matson Agreement supersedes Matson's Credit Agreement with BofA dated
October 25, 2002 of $50 million, as amended; and the Revolving Line of Credit
Note with Wells Fargo dated September 30, 2005 of $30 million.
The A&B Agreement and Matson Agreement, which expire on December 28,
2011, together provide the Company with an aggregate $325 million, 5-year
unsecured commitment ("Senior Credit Facility"). During the term of the Senior
Credit Facility, A&B and Matson (the "Borrowers"), at their option, may
reallocate the $325 million commitment available under the Senior Credit
Facility between the Borrowers, provided the aggregate commitment remains at
$325 million. The Borrowers may allocate the entire commitment available under
the Senior Credit Facility to A&B, or they may allocate any other amount,
generally in increments of $1 million, to Matson, provided the allocation to
Matson does not exceed $100 million.
The Senior Credit Facility also provides for: (i) a $100 million
sub-limit for the issuance of standby and commercial letters of credit for the
account of A&B, (ii) a $50 million sub-limit for the issuance of standby and
commercial letters of credit for Matson, and (iii) a $30 million sub-limit for
swing line loans.
The Senior Credit Facility is subject to facility fees, letter of
credit fees and interest on draws based on the Borrowers' credit rating as
determined by Standard & Poor's or Moody's Investment Service, Inc. Facility
fees and letter of credit fees are computed using rates tied to a sliding scale,
which range from 0.075% to 0.150% for facility fees and 0.225% to 0.475% for
letter of credit fees, based on the Borrowers' current credit rating. Interest
rates on draws under the Senior Credit Facility are also tied to a sliding scale
of rates based on the Borrowers' current credit rating, plus London Interbank
Offered Rate ("LIBOR") for the applicable borrowing period. These rates range
from 0.225% to 0.475% plus LIBOR. Alternatively, the Borrowers may select an
interest rate based on a "base rate option," as defined in the agreements.
Amounts drawn under the Senior Credit Facility currently bear interest
at 0.225% plus LIBOR, provided the Borrowers maintain an S&P/Moody's rating of
A-/A3 or better. The maturity date for draws under the Senior Credit Facility
ranges from two weeks to six months, at the Borrowers' option.
Amounts drawn under the swing line bear interest at a rate agreed
between the Borrowers and the Lenders at the time a draw is made and loans
mature no later than ten business days from the date of the draw.
The A&B Agreement and the Matson Agreement contain various restrictive
covenants. Restrictive covenants for A&B include the requirement that it
maintain minimum shareholders' equity levels, minimum property investment
values, and total debt to earnings before interest, depreciation, amortization,
and taxes of 3.75:1. Restrictive covenants for Matson include the requirement
that it maintain minimum shareholders' equity levels, working capital in excess
of $1, and limitations on the creation of certain liens.
The foregoing description of the A&B Agreement and the Matson Agreement
is qualified in its entirety by the terms of the A&B Agreement and Matson
Agreement, which are filed as Exhibits 10.1 and 10.2, respectively.
Item 9.01 Financial Statements and Exhibits
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(d) Exhibits
10.1 Credit Agreement, dated December 28, 2006, between
Alexander & Baldwin, Inc. and First Hawaiian Bank,
Bank of America, N.A., Wells Fargo Bank, National
Association, BNP Paribas, American Savings Bank,
F.S.B., and Bank of Hawaii.
10.2 Credit Agreement, dated December 28, 2006, between
Matson Navigation Company, Inc. and First Hawaiian
Bank, Bank of America, N.A., Wells Fargo Bank,
National Association, BNP Paribas, American Savings
Bank, F.S.B., and Bank of Hawaii.
SIGNATURE
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Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: January 4, 2007
ALEXANDER & BALDWIN, INC.
/s/ Christopher J. Benjamin
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Christopher J. Benjamin
Senior Vice President, Chief Financial
Officer and Treasurer