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): May 12, 2009 (May 6, 2009)
___________________________________
Merck
& Co, Inc.
(Exact
name of registrant as specified in its charter)
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New
Jersey
(State
or other jurisdiction of
incorporation
or organization)
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1-3305
(Commission
File Number)
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22-1109110
(I.R.S.
Employer Identification No.)
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One
Merck Drive, P.O. Box 100,
Whitehouse
Station, NJ
(Address
of principal executive offices)
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08889
(Zip
Code)
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Registrant’s
telephone number, including area code: (908) 423-1000
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N/A
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(Former
name or former address, if changed since last
report)
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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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o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
Pre-commencement communications pursuant to Rule 14d−2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
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o 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
Item
2.03 Creation of a Direct Financial Obligation or an Obligation under
an Off-Balance Sheet Arrangement of a Registrant.
On May 6,
2009, Merck & Co., Inc. entered into (i) a 364-day bridge loan agreement
(the “Bridge Loan Facility”), (ii) a 364-day asset sale facility agreement (the
“Asset Sale Facility”) and (iii) a 364-day incremental loan facility (the
“Incremental Loan Facility” and together with the Bridge Loan Agreement and the
Asset Sale Facility Agreement, the “New Credit Facilities”). Under
each of the New Credit Facilities, JPMorgan Chase Bank, N.A. (“JPMorgan”) is the
administrative agent, J.P. Morgan Securities Inc. is the sole bookrunner and the
sole lead arranger and Banco Santander, S.A. New York Branch, Bank of America
Securities LLC, BNP Paribas Securities Corp., Citigroup Global Markets Inc.,
Credit Suisse (USA) LLC, HSBC Bank USA, National Association, The Royal Bank of
Scotland plc, and UBS Securities LLC are the co-arrangers. In
addition to JPMorgan and the eight co-arrangers, twenty other lenders are party
to the Bridge Loan Facility and the Asset Sale Facility and fourteen other
lenders are party to the Incremental Loan Facility. The maximum
aggregate exposure for any single lender under the New Credit Facilities is
$875.0 million. J.P. Morgan Securities Inc. is also serving as the
exclusive financial advisor of Merck in connection with its proposed combination
with Schering-Plough Corporation (the “Proposed Transaction”).
Under the
Bridge Loan Facility, Merck may borrow on an unsecured basis an aggregate
principal amount of up to $3.0 billion; under the Asset Sale Facility, Merck may
borrow on an unsecured basis an aggregate principal amount of up to $3.0 billion
and under the Incremental Facility, Merck may borrow on an unsecured basis an
aggregate principal amount of up to $1.0 billion. The proceeds of the
New Credit Faculties are required to be used to fund, or backstop commercial
paper used to fund, the Proposed Transaction and for other general corporate
purposes. Amounts outstanding under New Credit Facilities will bear
interest, at Merck's option, either (a) at the base rate (defined as the highest
of (1) JPMorgan’s prime rate, (2) the federal funds rate plus 0.50% and (3) the
adjusted LIBO rate for a one month interest period beginning on such day plus
1.00%) or (b) at the reserve adjusted eurodollar rate plus, in each case, an
applicable margin.
Merck may
voluntarily prepay the loans at anytime without premium or
penalty. Merck will be required to make prepayments of term loans
under the Asset Sale Facility (in the case of (ii) and (iii) below, only after
repayment in full of the Bridge Loan Facility) and the Bridge Loan Facility with
(i) net cash proceeds of non-ordinary course asset sales,
(ii) issuances of debt and (iii) net cash proceeds from the issuance
of equity of Merck, in each case subject to certain exceptions. The
New Credit Facilities also contain certain events of default, upon the
occurrence of which, and so long as such event of default is continuing, the
amounts outstanding will accrue interest at an increased rate and payments of
such outstanding amounts could be accelerated by the lenders. The New
Credit Facilities contain customary representations and warranties, affirmative
covenants and negative covenants, including restrictions on liens, mergers and
consolidations and maintenance of a maximum ratio of total debt to
capitalization of 60%, in each case applicable to Merck and its subsidiaries and
following the Proposed Transaction to Schering-Plough and its subsidiaries
(including Merck). The Bridge Loan Facility contains the following
additional negative covenants (subject to exceptions and
baskets): limitations with respect to non-guarantor indebtedness,
limitations on dividends and share repurchases, restrictions on subsidiary
distributions, restrictions on investments and restrictions on transactions with
affiliates.
The
funding of the New Credit Facilities is subject to various conditions precedent
including: (i) the consummation of the Proposed Transaction; (ii) the
absence, since December 31, 2008, of any material adverse change (as defined in
the New Credit Facilities) with respect to Merck and Schering-Plough taken as a
whole; (iii) the execution of definitive documentation with respect to the new
credit facilities and the amendment to Merck’s existing revolving credit
facility (which condition has been satisfied); (iv) certification by the chief
financial officer of Merck that the ratio of total debt to capitalization of the
combined company on a pro forma basis as of the last fiscal quarter ended at
least 45 days before closing does not exceed 60%; and (v) other customary
closing conditions each as more fully described in the New Credit
Facilities.
The
description of the New Credit Facilities above is a summary and is qualified in
its entirety by reference to the credit agreements providing for the Bridge Loan
Facility, the Asset Sale Facility and the Incremental Loan Facilities, copies of
which are attached as Exhibits 10.1, 10.2 and 10.3 respectively to this report
and incorporated herein by reference.
Item
9.01 Financial Statements and Exhibits.
| Number |
Description |
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| 10.1 |
INCREMENTAL
CREDIT AGREEMENT dated as of May 6, 2009, among MERCK & CO., INC.,
the GUARANTORS and LENDERS party thereto,
and JPMORGAN CHASE BANK, N.A., as Administrative
Agent.
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| 10.2 |
ASSET
SALE FACILITY AGREEMENT dated as of May 6, 2009, among MERCK & CO.,
INC., the GUARANTORS and LENDERS party thereto,
and JPMORGAN CHASE BANK, N.A., as Administrative Agent.
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| 10.3 |
BRIDGE
LOAN AGREEMENT dated as of May 6, 2009, among MERCK & CO., INC., the
GUARANTORS and LENDERS party thereto,
and JPMORGAN CHASE BANK, N.A., as Administrative
Agent.
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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.
Date: May
12, 2009
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Merck
& Co., Inc.
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By:
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/s/
Celia A. Colbert
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Name:
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Celia
A. Colbert
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Title:
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Vice
President, Secretary and Assistant General
Counsel
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INDEX TO
EXHIBITS
| Number |
Description |
| |
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| 10.1 |
INCREMENTAL
CREDIT AGREEMENT dated as of May 6, 2009, among MERCK & CO., INC.,
the GUARANTORS and LENDERS party thereto,
and JPMORGAN CHASE BANK, N.A., as Administrative
Agent.
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| 10.2 |
ASSET
SALE FACILITY AGREEMENT dated as of May 6, 2009, among MERCK & CO.,
INC., the GUARANTORS and LENDERS party thereto,
and JPMORGAN CHASE BANK, N.A., as Administrative Agent.
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| 10.3 |
BRIDGE
LOAN AGREEMENT dated as of May 6, 2009, among MERCK & CO., INC., the
GUARANTORS and LENDERS party thereto,
and JPMORGAN CHASE BANK, N.A., as Administrative
Agent.
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