Form 8-K

Marsh & McLennan Co Inc 23 November 2004 Date: November 22, 2004 Notification of filing of Current Report on Form 8-K Please be advised that Marsh & McLennan Companies, Inc. (MMC) filed a Current Report on Form 8-K with the Securities and Exchange Commission today. A copy of the 8-K is set out below. Jean McConney Corporate Counsel 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 17, 2004 ---------------------------------------------- Marsh & McLennan Companies, Inc. ------------------------------------------------------------------------------------------------- (Exact Name of Registrant as Specified in Charter) Delaware 1-5998 36-2668272 --------------------------------- ----------------------------- --------------------------------- (State or Other Jurisdiction (Commission File Number) (IRS Employer of Incorporation) Identification No.) 1166 Avenue of the Americas, New York, NY 10036 ------------------------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code (212) 345-5000 -------------------------------------------- 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)) Section 1--Registrant's Business and Operations Item 1.01. Entry into a Material Definitive Agreement. On November 17, 2004, Marsh & McLennan Companies, Inc. ('MMC') entered into a commitment letter with Citibank, N.A., Bank of America, N.A. and Deutsche Bank AG New York Branch and certain of their affiliates (the 'Arranging Banks') with respect to a new $1 billion term loan facility (the 'Term Loan Facility') and the amendment of $1.7 billion of existing revolving facilities (the 'Revolving Facilities' and together with the Term Loan Facility, the 'Facilities'). The Term Loan Facility would replace MMC's existing $700 million and $355 million revolving credit facilities which are due to expire in 2005. The Arranging Banks have committed an aggregate of $525 million to the Term Loan Facility with the balance to be raised in the syndicated bank loan market. The commitment letter is subject to certain customary conditions including satisfactory completion of documentation, due diligence and syndication. The Term Loan Facility will mature December 31, 2006, $1 billion of the amended Revolving Facilities will mature June 13, 2007 and $700 million of the amended Revolving Facilities will mature June 9, 2009. The Facilities will be unconditionally guaranteed by Marsh Inc., Putnam Investments Trust and Mercer Inc. MMC expects that the closing of the Facilities will occur in mid-December. While MMC knows of no reason why it will not be able to achieve this goal, there can be no assurance. The foregoing brief summary of the commitment letter is qualified in its entirety by reference to the commitment letter, a copy of which is filed herewith. Section 9--Financial Statements and Exhibits Item 9.01. Financial Statements and Exhibits. (c) Exhibits 10.1 Commitment Letter dated as of November 17, 2004 among MMC, Citibank, N.A., Bank of America, N.A. and Deutsche Bank AG New York Branch and certain of their affiliates. 2 INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS Marsh & McLennan Companies, Inc. and its subsidiaries ('MMC') and their representatives may from time to time make verbal or written statements (including certain statements contained in this report and other MMC filings with the Securities and Exchange Commission and in our reports to stockholders) relating to future results, which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such statements may include, without limitation, discussions concerning revenues, expenses, earnings, cash flow, elimination of market service agreements ('MSA'), capital structure, existing credit facilities, access to commercial paper markets, pension funding, the adverse consequences arising from market-timing issues at Putnam, including fines and restitution, the matters raised in the complaint filed by the New York State Attorney General's Office stating a claim for, among other things, fraud and violations of New York State antitrust and securities laws, as well as market and industry conditions, premium rates, financial markets, interest rates, foreign exchange rates, contingencies, and matters relating to MMC's operations and income taxes. Such forward-looking statements are based on available current market and industry materials, experts' reports and opinions, and long-term trends, as well as management's expectations concerning future events impacting MMC. Forward-looking statements by their very nature involve risks and uncertainties. Factors that may cause actual results to differ materially from those contemplated by any forward-looking statements contained herein include, in the case of MMC's risk and insurance services business, changes in competitive conditions, the impact of litigation and other matters concerning the claims brought by the New York State Attorney General's Office and state insurance regulators, loss of clients, inability to collect previously accrued MSA revenue, movements in premium rate levels, the conditions for the transfer of commercial risk and other changes in the global property and casualty insurance markets, natural catastrophes, mergers between client organizations, and insurance or reinsurance company insolvencies. Factors to be considered in the case of MMC's investment management business include changes in worldwide and national equity and fixed income markets, actual and relative investment performance, the level of sales and redemptions, and the ability to maintain investment management and administrative fees at historic levels; and with respect to all of MMC's activities, the ability to amend or replace MMC's existing credit facilities to provide long term support for commercial paper borrowings following the claims brought by the New York State Attorney General, the continued strength of MMC's relationships with its employees and clients, the ability to successfully integrate acquired businesses and realize expected synergies, changes in general worldwide and national economic conditions, the impact of terrorist attacks, changes in the value of investments made in individual companies and investment funds, fluctuations in foreign currencies, actions of competitors or regulators, changes in interest rates or in the ability to access financial markets, developments relating to claims, lawsuits and contingencies, prospective and retrospective changes in the tax or accounting treatment of MMC's operations, and the impact of tax and other legislation and regulation in the jurisdictions in which MMC operates. 3 Forward-looking statements speak only as of the date on which they are made, and MMC undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which it is made or to reflect the occurrence of unanticipated events. Please refer to Marsh & McLennan Companies' 2003 Annual Report on Form 10-K for 'Information Concerning Forward-Looking Statements,' its reports on Form 8-K, and quarterly reports on Form 10-Q. MMC is committed to providing timely and materially accurate information to the investing public, consistent with our legal and regulatory obligations. To that end, MMC and its operating companies use their websites to convey meaningful information about their businesses, including the anticipated release of quarterly financial results and the posting of updates of assets under management at Putnam. Monthly updates of total assets under management at Putnam will be posted to the MMC website the first business day following the end of each month. Putnam posts mutual fund and performance data to its website regularly. Assets for most Putnam retail mutual funds are posted approximately two weeks after each month-end. Mutual fund net asset value (NAV) is posted daily. Historical performance and Lipper rankings are also provided. Investors can link to MMC and its operating company websites through www.mmc.com. ----------- 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. MARSH & McLENNAN COMPANIES, INC. By: /s/ Bart Schwartz ----------------------------------- Name: Bart Schwartz Title: Deputy General Counsel Date: November 22, 2004 EXECUTION COPY CITIGROUP GLOBAL MARKETS INC. BANC OF AMERICA DEUTSCHE BANK CITIBANK, N.A. SECURITIES LLC SECURITIES INC. 390 Greenwich Street BANK OF AMERICA, N.A. DEUTSCHE BANK AG NEW New York, New York 10013 214 North Tryon Street YORK BRANCH Charlotte, North Carolina 28255 60 Wall Street New York, New York 10005-2858 November 17, 2004 MARSH & MCLENNAN COMPANIES, INC. 1166 Avenue of the Americas New York, NY 10036 Attention: Sandra S. Wijnberg Senior Vice President and Chief Financial Officer $1.0 Billion Term Loan Facility and $1.7 Billion Revolving Facilities COMMITMENT LETTER Ladies and Gentlemen: Each of Citibank, N.A. ('Citibank'), Bank of America, N.A. ('BofA') and Deutsche Bank AG New York Branch ('Deutsche Bank' and, together with Citibank and BofA, the 'Initial Lenders') is pleased to inform Marsh & McLennan Companies, Inc. (the 'Company') of its several commitment to: (i) provide the Company with a portion of the term loan facility described in Annex I hereto (the 'Term Facility'), in each case in the amount set forth on Schedule 1 hereto and subject to the terms and conditions set forth herein and in Annex I hereto; (ii) consent to an amendment of the Credit Agreement (5 Year) dated as of June 13, 2002 (as amended, supplemented or otherwise modified prior to the date hereof, the 'Existing 2007 Revolving Facility') among the Company, the banks and other financial institutions party thereto, and JPMorgan Chase Bank, as administrative agent (as so amended, the 'Amended 2007 Revolving Facility'), in each case subject to the terms and conditions set forth herein and in Annex II hereto; and (iii) consent to an amendment of the Credit Agreement (5 Year) dated as of June 9, 2004 (as amended, supplemented or otherwise modified prior to the date hereof, the 'Existing 2009 Revolving Facility' and, together with the Existing 2007 Revolving Facility, the 'Existing Revolving Facilities') among the Company, the banks and other financial institutions party thereto, and JPMorgan Chase Bank, as administrative agent (as so amended, the 'Amended 2009 Revolving Facility' and, together with the Amended 2007 Revolving Facility, the 'Revolving Facilities'; the Revolving Facilities and the Term Facility being collectively referred to herein as the 'Facilities'), in each case subject to the terms and conditions set forth herein and in Annex III hereto (this letter, together with Annexes I, II and III, being referred to collectively as this 'Commitment Letter'). 1 Further, subject to the terms and conditions set forth in this Commitment Letter, (a) Citigroup Global Markets Inc. ('CGMI' and, together with Citibank, 'Citigroup') is pleased to inform the Company of its commitment to act as (i) Global Coordinator for the Facilities, (ii) Joint Lead Arranger for each of the Facilities, and (iii) Joint Bookrunner for each of the Facilities, (b) Banc of America Securities LLC ('BAS') is pleased to inform the Company of its commitment to act as (i) Joint Lead Arranger for each of the Facilities and (ii) Joint Bookrunner for the Term Facility and the Existing 2009 Revolving Facility, (c) Deutsche Bank Securities Inc. ('DBSI' and, together with CGMI and BAS, the 'Arrangers'; the Arrangers and the Initial Lenders being collectively referred to as the 'Lender Parties') is pleased to inform the Company of its commitment to act as (i) Joint Lead Arranger for each of the Facilities and (ii) Joint Bookrunner for the Existing 2007 Revolving Facility, and (d) CGMI is pleased to inform the Company of its commitment to use its best efforts to arrange a syndicate of lenders (collectively, the 'Term Lenders') for the balance of the Term Facility and to solicit the consents required for the Revolving Facilities (such syndication and solicitation being collectively referred to herein as the 'Syndication,' and the Term Lenders and the lenders under Revolving Facilities (the 'Revolving Lenders') being collectively referred to herein as the 'Lenders') (it being understood and agreed that neither CGMI nor the Initial Lenders, nor any affiliate of CGMI or the Initial Lenders, are agreeing to underwrite such syndication or consents). Section 1. Conditions Precedent. The commitments of each of the Initial Lenders and the agreements of each of the Arrangers to provide services hereunder are subject to: (a) the preparation, execution and delivery of mutually acceptable loan documentation (including, in the case of the Revolving Facilities, amendments to existing loan documentation) incorporating substantially the terms and conditions outlined in this Commitment Letter (the 'Operative Documents'); (b) the absence of (i) any material adverse change in the business, financial position, results of operations or prospects of the Company and its consolidated subsidiaries, taken as a whole, since December 31, 2003 (other than matters described in the Company's public filings prior to the date hereof or otherwise disclosed in writing to the Lender Parties prior to the date hereof, including, without limitation, (A) the civil complaint filed on October 14, 2004 by the Attorney General of the State of New York against the Company and Marsh Inc. in the Supreme Court of the State of New York County of New York (the 'Complaint'), and (B) any claim arising out of, or any action, suit or proceeding filed or threatened against the Company or any Subsidiary of the Company based on, allegations similar to those set forth in the Complaint or related thereto), and (ii) any circumstance, change or condition in the loan syndication, financial or capital markets generally that, in the judgment of the Arrangers, could reasonably be expected to materially impair Syndication; (c) the accuracy and completeness of all representations that the Company and its subsidiaries make to the Lender Parties and all material information, taken as a whole, that the Company and its subsidiaries furnish to the Lender Parties; (d) the receipt of (i) commitments from other Term Lenders for the balance of the Term Facility on the terms and conditions set forth in Annex I and (ii) all consents required in connection with the Revolving Facilities; (e) the Company's compliance with the terms of this Commitment Letter, including, without limitation, the payment in full when due of all fees, expenses and other amounts payable hereunder; and (f) its completion of and satisfaction with a due diligence investigation of the Company and its subsidiaries. Section 2. Commitment Termination. The commitments of the Lender Parties hereunder will terminate on the earlier of (a) the date the Operative Documents become effective, and (b) December 31, 2004. Before such date, any Lender Party may terminate its commitment hereunder if any event occurs or information becomes available that, in the judgment of such Lender Party, results or is reasonably likely to result in the failure to satisfy any condition set forth in Section 1. Section 3. Syndication. CGMI will manage all aspects of the Syndication in consultation with the Company, including the timing of all offers to potential Term Lenders and Revolving Lenders, the 2 determination of the amounts offered to potential Term Lenders and Revolving Lenders, the acceptance of commitments of the Term Lenders and the compensation to be provided to the Lenders. The Company shall take all action as CGMI may reasonably request to assist CGMI in forming a syndicate for the Term Facility acceptable to CGMI and in obtaining consents required in connection with the Revolving Facilities. The Company's assistance shall include, but not be limited to, (a) making senior management and representatives of the Company and its principal subsidiaries available to participate in information meetings with potential Term Lenders and Revolving Lenders at such times and places as CGMI may reasonably request; (b) using the Company's best efforts to ensure that the Syndication efforts benefit from the Company's lending relationships; and (c) providing CGMI with all information reasonably deemed necessary by it to successfully complete the Syndication. To ensure an effective Syndication, the Company agrees that until the completion of the Syndication (as determined by CGMI), the Company will not, and will not permit any of its subsidiaries to, syndicate or issue, attempt to syndicate or issue, announce or authorize the announcement of the syndication or issuance of, or engage in discussions concerning the syndication or issuance of, any debt facility or debt security (including any renewals thereof), without the prior written consent of each Arranger, which consent shall not be unreasonably withheld; provided, however, that the foregoing shall not limit the Company's ability to issue commercial paper, other short-term debt programs currently in place, equity or public debt securities or to refinance existing bilateral credit facilities (including the Mortgage as defined in the Existing Revolving Facilities). Citibank will act as the sole Administrative Agent for the Term Facility, and JPMorgan Chase Bank will act as the sole Administrative Agent for the Revolving Facilities. In addition, Citibank will act as Syndication Agent for the Revolving Facilities, BofA and DBSI will act as Documentation Agents for the Revolving Facilities, and BofA and DBSI will act as Syndication Agents for the Term Facility. Except as expressly set forth herein, no additional agents, co-agents or arrangers will be appointed, or other titles conferred, without the consent of CGMI. It is further understood and agreed that the name of Citibank and CGMI (as applicable) shall appear to the left of (and in no event below) the names of BofA, BAS, Deutsche Bank and DBSI, and above and to the left of the name of any other Lender, co-lead arranger, joint manager or agent, on the cover of the Information Memorandum or other syndication materials that describe the Facilities. Section 4. Fees. In addition to the fees described in Annexes I, II and III, the Company shall pay the non-refundable fees set forth in the letter agreements dated the date hereof (collectively, the 'Fee Letters') between (a) the Company and the Initial Lenders and (b) the Company and Citigroup. The terms of the Fee Letters are an integral part of the commitments hereunder and constitute part of this Commitment Letter for all purposes hereof. Section 5. Indemnification. The Company shall indemnify and hold harmless the Lender Parties, each Lender and each of their respective affiliates and each of their respective officers, directors, employees, agents, advisors and representatives (each, an 'Indemnified Party') from and against any and all claims, damages, losses, liabilities and expenses (including, without limitation, reasonable fees and disbursements of counsel), joint or several, that may be incurred by or asserted or awarded against any Indemnified Party (including, without limitation, in connection with any investigation, litigation or proceeding or the preparation of a defense in connection therewith), in each case arising out of or in connection with or by reason of this Commitment Letter or the Operative Documents or the transactions contemplated hereby or thereby or any actual or proposed use of the proceeds of the Facilities, except to the extent such claim, damage, loss, liability or expense is incurred by reason of the gross negligence or willful misconduct of such Indemnified Party. In the case of an investigation, litigation or other proceeding to which the indemnity in this paragraph applies, such indemnity shall be effective whether or 3 not such investigation, litigation or proceeding is brought by the Company, any of its directors, security holders or creditors, an Indemnified Party or any other person or an Indemnified Party is otherwise a party thereto and whether or not the transactions contemplated hereby are consummated. No Indemnified Party shall have any liability (whether in contract, tort or otherwise) to the Company or any of its security holders or creditors for or in connection with the transactions contemplated hereby, except to the extent such liability is determined in a final non-appealable judgment by a court of competent jurisdiction to have resulted primarily from such Indemnified Party's gross negligence or willful misconduct. In no event, however, shall any Indemnified Party be liable on any theory of liability for any special, indirect, consequential or punitive damages (including, without limitation, any loss of profits, business or anticipated savings). Section 6. Costs and Expenses. The Company shall pay, or reimburse the Lender Parties on demand for, all out-of-pocket costs and expenses incurred by the Lender Parties (whether incurred before or after the date hereof) in connection with the Facilities and the preparation, negotiation, execution and delivery of this Commitment Letter, including, without limitation, the reasonable fees and expenses of outside counsel, regardless of whether any of the transactions contemplated hereby are consummated. The Company shall also pay all costs and expenses of the Lender Parties (including, without limitation, the reasonable fees and disbursements of counsel) incurred in connection with the enforcement of any of their respective rights and remedies hereunder. Section 7. Confidentiality. By accepting delivery of this Commitment Letter, the Company agrees that this Commitment Letter is for the Company's confidential use only and that neither its existence nor the terms hereof will be disclosed by the Company to any person other than the Company's officers, directors, employees, accountants, attorneys and other advisors, agents and representatives (the 'Company Representatives') and then only on a confidential and 'need to know' basis in connection with the transactions contemplated hereby; provided, however, that the Company may make such other public disclosures of the terms and conditions hereof as the Company is required by law, in the opinion of the Company's counsel, to make. The Lender Parties agree that the provisions of Section 9.11 of the Existing Revolving Facilities apply to any information made available to them in connection with this Commitment Letter or any of the transactions contemplated hereby. Section 8. Representations and Warranties of the Company. The Company represents and warrants that (a) all information (other than projections) that has been or will hereafter be made available to the Lender Parties, any Lender or any potential Lender by the Company or any of its representatives in connection with the transactions contemplated hereby is or will, when furnished, be complete and correct in all material respects and does not or will not, when furnished, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein not misleading in light of the circumstances under which such statements were or are made and (b) all projections, if any, that have been or will be prepared by the Company and made available to the Lender Parties, any Lender or any potential Lender have been or will be prepared in good faith based upon reasonable assumptions (it being understood that such projections are subject to significant uncertainties and contingencies, many of which are beyond the Company's control, and that no assurance can be given that the projections will be realized). The Company agrees to supplement the information and projections from time to time until the Operative Documents become effective so that the representations and warranties contained in this paragraph remain correct. In providing this Commitment Letter, the Lender Parties are relying on the accuracy of the information furnished to it by or on behalf of the Company and its affiliates without independent verification thereof. 4 Section 9. No Third Party Reliance, Etc. The agreements of the Lender Parties hereunder and of any Lender that issues a commitment to provide financing under the Term Facility or that consents to the Revolving Facilities are made solely for the benefit of the Company and may not be relied upon or enforced by any other person. Please note that this Commitment Letter does not include all of the terms and conditions of the Facilities, and that those matters that are not covered or made clear herein are subject to mutual agreement of the parties. The Company may not assign or delegate any of its rights or obligations hereunder without the prior written consent of the Lender Parties. This Commitment Letter may not be amended or modified, or any provision hereof waived, except by a written agreement signed by all parties hereto. This Commitment Letter is not intended to create a fiduciary relationship among the parties hereto. The Company acknowledges that the Lender Parties and/or one or more affiliates of each of the Lender Parties may provide financing, equity capital, financial advisory and/or other services to parties whose interests may conflict with the Company's interests. Consistent with each Lender Party's policy to hold in confidence the affairs of its customers, each Lender Party agrees that neither it nor any of its affiliates will furnish confidential information obtained from the Company to any of such Lender Party's other customers. Furthermore, neither any Lender Party nor any of its respective affiliates will make available to the Company confidential information that such Lender Party obtained or may obtain from any other person. Each Lender Party reserves the right to employ the services of its affiliates in providing the services contemplated by this Commitment Letter and to allocate, in whole or in part, to such affiliates any fees payable to it in such manner as it and its affiliates may agree in their sole discretion; provided that the Company shall incur no additional obligations as a result of any such allocation. Section 10. Governing Law, Etc. This Commitment Letter shall be governed by, and construed in accordance with, the law of the State of New York. This Commitment Letter sets forth the entire agreement between the parties with respect to the matters addressed herein and supersedes all prior communications, written or oral, with respect hereto. This Commitment Letter may be executed in any number of counterparts, each of which, when so executed, shall be deemed to be an original and all of which, taken together, shall constitute one and the same Commitment Letter. Delivery of an executed counterpart of a signature page to this Commitment Letter by telecopier shall be as effective as delivery of an original executed counterpart of this Commitment Letter. Sections 4 through 8, 10 and 11 hereof shall survive the termination of the commitments of the Lender Parties hereunder. The Company acknowledges that information and documents relating to the Facilities may be transmitted through Intralinks, the internet or similar electronic transmission systems. Section 11. Waiver of Jury Trial. Each party hereto irrevocably waives all right to trial by jury in any action, proceeding or counterclaim (whether based on contract, tort or otherwise) arising out of or relating to this Commitment Letter or the transactions contemplated hereby or the actions of the parties hereto in the negotiation, performance or enforcement hereof. 5 Please indicate the Company's acceptance of the provisions hereof by (a) signing the enclosed copy of this Commitment Letter and returning it to Richard Banziger, Managing Director, Citigroup Global Markets Inc., 390 Greenwich Street, New York, New York 10013 (fax: (212) 723-8590), and (b) signing the Fee Letters and returning the same as instructed therein, in each case at or before 5:00 p.m. (New York City time) on November 17, 2004, the time at which the commitments of the Lender Parties hereunder (if not so accepted prior thereto) will terminate. If the Company elects to deliver this Commitment Letter by telecopier, please arrange for the executed original to follow by next-day courier. Very truly yours, CITIGROUP GLOBAL MARKETS INC. By /s/ Richard Banziger -------------------- Name: Richard Banziger Title: Managing Director CITIBANK, N.A. By /s/ Matthew Nicholls -------------------- Name: Matthew Nicholls Title: Director BANK OF AMERICA, N.A. By /s/ Shelly K. Harper -------------------- Name: Shelly K. Harper Title: Senior Vice President BANC OF AMERICA SECURITIES LLC By /s/ Peter C. Hall ----------------- Name: Peter C. Hall Title: Managing Director DEUTSCHE BANK AG NEW YORK BRANCH By /s/ Richard Herder ------------------ Name: Richard Herder Title: Managing Director By /s/ John S. McGill ------------------ Name: John S. McGill Title: Director (Signatures continued on next page) 6 DEUTSCHE BANK SECURITIES INC. By /s/ Richard Herder ------------------ Name: Richard Herder Title: Managing Director By /s/ John S. McGill ------------------ Name: John S. McGill Title: Director (Signatures continued on next page) 7 ACCEPTED AND AGREED on November 17, 2004: MARSH & MCLENNAN COMPANIES, INC. By /s/ Sandra S. Wijnberg ---------------------- Name: Sandra S. Wijnberg Title: Sr. VP, Chief Financial Officer 8 Schedule I Initial Lender Commitments Initial Lender Commitment -------------- ---------- Citibank, N.A. $175,000,000 Bank of America, N.A. $175,000,000 Deutsche Bank AG New York Branch $175,000,000 Annex I Marsh & McLennan Companies, Inc. $1.0 Billion 2-Year Term Loan Facility Summary of Terms and Conditions ------------------------------- Capitalized terms used herein and not otherwise defined are used with the meanings set forth in the Commitment Letter to which this Summary of Terms and Conditions is attached. Borrower: Marsh & McLennan Companies, Inc., a Delaware corporation (the 'Borrower'). Facility Amount: $1.0 billion. Type of Facility: Two-year unsecured term loan (the 'Term Facility'). Guarantors: The Term Facility will be unconditionally guaranteed by Marsh Inc., Putnam Investments Trust and Mercer Inc. (collectively, the 'Guarantors' and, together with the Borrower, the 'Loan Parties'). Master Agreement: The Term Facility will be entered into at the same time as the amendment of the Revolving Facilities. The documentation for the Facilities may include a Master Agreement that will contain mutually acceptable provisions for collective voting and pro rata payments in specified circumstances and certain other matters as agreed by the parties. Purpose: General corporate purposes. Global Coordinator: Citigroup Global Markets Inc. Administrative Agent: Citibank, N.A. (the 'Agent'). Syndication Agents: Bank of America, N.A. and Deutsche Bank AG New York Branch. Joint Lead Arrangers: Citigroup Global Markets Inc., Banc of America Securities LLC, and Deutsche Bank Securities Inc. Joint Bookrunners: Citigroup Global Markets Inc. and Banc of America Securities LLC. Lenders: Citibank, Bank of America, N.A., Deutsche Bank AG New York Branch and other financial institutions acceptable to the Borrower, the Agent and the Global Coordinator. Closing Date: On or before December 31, 2004. 1 Maturity Date: December 31, 2006. Interest Rates and Interest Periods: At the Borrower's option, any Advance that is made to it will be available at the rates and for the Interest Periods stated below: 1) Base Rate: a fluctuating rate equal to Citibank's Base Rate plus the Applicable Margin. 2) Eurodollar Rate: a periodic fixed rate equal to LIBOR plus the Applicable Margin. The Eurodollar Rate will be fixed for Interest Periods of 1, 2, 3 or 6 months. Upon the occurrence and during the continuance of any Event of Default, each Eurodollar Rate Advance will convert to a Base Rate Advance at the end of the Interest Period then in effect for such Eurodollar Rate Advance. Applicable Margin: The Applicable Margin means: 1) for Base Rate Advances, zero basis points per annum; and 2) for Eurodollar Rate Advances, a rate per annum determined from time to time in accordance with the Pricing Grid attached hereto as Exhibit A. If any principal, interest or other amounts are not paid when due, the applicable interest rate on those amounts will increase by 200 basis points per annum. Reference Banks: Citibank, Bank of America, N.A. and Deutsche Bank AG New York Branch and/or other banks to be agreed. Interest Payments: At the end of each Interest Period for each Advance, but no less frequently than quarterly. Interest will be computed on a 365/366-day basis for Base Rate Advances and a 360-day basis for Eurodollar Rate Advances. Availability: The Term Facility will be available in a single borrowing on the Closing Date. Amounts borrowed under the Term Facility and repaid or prepaid may not be reborrowed. Annual Agency Fee: As agreed between the Agent and the Borrower. Repayment: The Borrower will repay all outstanding loans under the Term Facility no later than the Maturity Date. Optional Prepayment: Advances may be prepaid without penalty, on same day notice for Base Rate Advances and 2 business days' notice for Eurodollar Rate 2 Advances, in minimum amounts of $5,000,000 and increments of $1,000,000 in excess thereof. The Borrower will bear all costs related to the prepayment of a Eurodollar Rate Advance prior to the last day of the Interest Period thereof. Mandatory Prepayments: The Borrower shall repay the Term Facility with 75% of the net proceeds from certain debt issuances and asset sales that exceed minimum individual and aggregate amounts to be agreed. Increase in Facility Amount: The Borrower will have the right to increase the Facility Amount, either at the Closing Date or thereafter until the Maturity Date, in minimum increments of $50,000,000, by up to $300 million, provided that no default has occurred and is continuing. The Borrower may offer the increase to (i) any existing Lender, and any such Lender will have the right, but no obligation, to commit to all or a portion of the proposed increase or (ii) third party financial institutions acceptable to the Agent, provided that the minimum commitment of each such institution equals or exceeds $10,000,000. Loan Documentation: The Term Facility will be subject to the preparation, execution and delivery of mutually acceptable loan documentation that will contain conditions precedent, representations and warranties, covenants, events of default and other provisions based on the documentation for the Existing Revolving Facilities with additional provisions as reflected below. Conditions Precedent to Closing: Consistent with Existing Revolving Facilities, including, but not limited to: 1) Certified copies of corporate documents for the Borrower and the Guarantors (collectively, the 'Loan Parties') 2) Board resolutions for the Loan Parties. 3) Incumbency/specimen signature certificate for each of the Loan Parties. 4) Accuracy of representations and warranties made by the Loan Parties and absence of default. 5) Favorable legal opinion from counsel for the Loan Parties. 6) Favorable legal opinion from counsel for the Agent. 7) The termination of the commitments of the Lenders and payment in full of all obligations under (i) the Credit Agreement (364 Day) dated as of July 7, 2004 (as amended, supplemented or otherwise modified) among the Borrower, the banks and other financial institutions party thereto, and Bank of America, N.A. as 3 administrative agent, and (ii) the Credit Agreement (364 Day) dated as of June 9, 2004 (as amended, supplemented or otherwise modified) among the Borrower, the banks and other financial institutions party thereto, and JPMorgan Chase Bank, as administrative agent. 8) Effectiveness of the amendments of the Revolving Facilities. Conditions Precedent to all Advances: As set forth in the Existing Revolving Facilities, including, but not limited to: 1) All representations and warranties are true and correct on and as of the date of the Advance, before and after giving effect to such Advance and to the application of the proceeds therefrom, as though made on and as of such date, provided that the representation as to no material adverse change shall be made only at Closing. 2) No default has occurred and is continuing, or would result from such Advance. Representations and Warranties: Generally as set forth in the Existing Revolving Facilities and others to be agreed, including, but not limited to: 1) Corporate existence and power. 2) Corporate and governmental authorization; no contravention. 3) Binding effect of loan documents. 4) Accuracy of financial information and no material adverse change in the business, financial position, results of operations or prospects of the Borrower and its consolidated subsidiaries, taken as whole, since December 31, 2003, except as to matters that have been disclosed in the Borrower's public filings before the Closing Date and other matters disclosed in writing to and approved by the Lenders, including, without limitation, (a) the civil complaint filed on October 14, 2004 by the Attorney General of the State of New York against the Borrower and Marsh Inc. in the Supreme Court of the State of New York County of New York (the 'Complaint'), and (b) any claim arising out of, or any action, suit or proceeding filed or threatened against the Borrower or any Subsidiary of the Borrower based on, allegations similar to those set forth in the Complaint or related thereto. 5) No litigation (other than litigation disclosed in the Borrower's public filings before the Closing Date and other litigation disclosed in writing to and approved by the Lenders) pending or, to the knowledge of the Borrower, threatened, in which there is a 4 reasonable probability of an adverse decision which would have a material adverse effect on the business, consolidated financial condition or consolidated results of operations of the Borrower and its subsidiaries, considered as a whole, or in any manner draws into question the validity or enforceability of the loan documents. 6) ERISA. 7) Taxes. 8) Status of material subsidiaries. 9) No regulatory restrictions. 10) Full disclosure. 11) Margin regulations. Financial Covenants: 1) Maximum Total Consolidated Debt to EBITDA ('Leverage Ratio') at levels to be mutually agreed. 2) Minimum Fixed Charge Coverage Ratio at levels to be mutually agreed. Covenants: Generally as set forth in the Existing Revolving Facilities and others to be agreed (in each case applicable to the Borrower and its subsidiaries and with appropriate qualifications and exceptions to be agreed), including, but not limited to: 1) Financial reporting and other information covenants (including separate financial information to be agreed with respect to each of the Guarantors). 2) Conduct of business and maintenance of existence. 3) Compliance with laws; borrowing authorizations. 4) Payment of taxes; maintenance of books and records; inspection rights. 5) Maintenance of insurance. 6) Use of proceeds. 7) Separate existence of each of the Loan Parties and compliance with corporate formalities. 8) No change in the nature of the business of the Borrower and its subsidiaries. 5 9) Restrictions on liens. 10) Limitations on incurrence of debt (including issuance of guarantees) by subsidiaries (including the Guarantors). 11) Restrictions on mergers, consolidations and sale of significant assets. 12) Restrictions on significant acquisitions and investments. Events of Default: Generally as set forth in the Existing Revolving Facilities and others to be agreed (applicable to the Borrower and its subsidiaries), including, but not limited to: 1) Failure to pay principal when due, or failure to pay interest, fees or other amounts within 5 days of when due. 2) Failure to comply with covenants with notice and cure periods to be agreed for certain covenants. 3) Representations or warranties incorrect in any material respect. 4) Cross-default to payment defaults on principal aggregating $100,000,000, or to other events if the effect is to accelerate or permit acceleration of such debt. 5) Failure to pay a final judgment or court order if not stayed within an appropriate period in excess of $100,000,000 (individually or in the aggregate). 6) Bankruptcy defaults. 7) ERISA defaults. 8) Change of control. 9) Repudiation or unenforceability of guarantees. Other: Loan documentation will include: 1) Indemnification of the Agent and Lenders and their respective affiliates, officers, directors, employees, agents and advisors for any liabilities and expenses arising out of the Term Facility or the use or proposed use of proceeds. 2) Waiver of consequential damages. 3) Agency, set-off and sharing language. 4) Required Lenders defined as those holding greater than 50% of outstanding Advances or, if none, commitments. The consent of all or affected Lenders will be required to extend the Maturity 6 Date, decrease interest rates, principal or fees, postpone scheduled payment dates, or for those provisions requiring 100% Lender approval, reduce the percentage of Lenders required to take action, or release guarantors prior to the later of repayment of the Term Facility and December 31, 2006. Assignments and Participations: Each Lender will have the right to assign to one or more eligible assignees all or a portion of its rights and obligations under the loan documents, with the consent, not to be unreasonably withheld, of the Agent and, so long as no Event of Default has occurred and is continuing, the Borrower. Minimum aggregate assignment levels will be $10,000,000 and increments of $1,000,000 in excess thereof. The parties to the assignment (other than the Borrower) will pay to the Agent an administrative fee of $3,500. Each Lender will also have the right, without the consent of the Borrower or the Agent, to assign (i) as security, all or part of its rights under the loan documents to any Federal Reserve Bank and (ii) with notice to the Borrower and the Agent, all or part of its rights and obligations under the loan documents to any of its affiliates. Each Lender will have the right to sell participations in its rights and obligations under the loan documents, subject to customary restrictions on the participants' voting rights. Yield Protection, Taxes, and Other Deductions: 1) The loan documents will contain yield protection provisions, customary for facilities of this nature, protecting the Lenders in the event of unavailability of funding, funding losses, and reserve and capital adequacy requirements. 2) All payments to be free and clear of any present or future taxes, withholdings or other deductions whatsoever (other than income taxes in the jurisdiction of the Lender's applicable lending office). The Lenders will use reasonable efforts to minimize to the extent possible any applicable taxes and the Borrower will indemnify the Lenders and the Agent for such taxes paid by the Lenders or the Agent. The Borrower will have the right to replace any Lender which requests reimbursements for amounts owing under (1) and (2) above, provided that (i) no Default or Event of Default has occurred and is continuing, (ii) the Borrower has satisfied all of its obligations under the Term Facility relating to such Lender, and (iii) any replacement is acceptable to the Agent (such consent not to be unreasonably withheld). Governing Law: State of New York. Counsel to the Arrangers: Shearman & Sterling LLP. 7 Submission to Jurisdiction: The Borrower will agree to submit to the non-exclusive jurisdiction of the courts of the State of New York in connection with disputes that may arise in connection with the Term Facility. 8 Exhibit A to Annex I Pricing Grid Term Facility ======================================================================================== LEVEL I LEVEL II LEVEL III ======================================================================================== BASIS FOR Either (a) Long-Term Level I is not Neither Level I nor PRICING Senior Unsecured Debt applicable, but either Level II is applicable rated at least BBB by (a) Long-Term Senior S&P or Baa2 by Unsecured Debt rated Moody's,* or (b) most at least BBB- by S&P recently calculated and Baa3 by Moody's, Leverage Ratio is or (b) most recently less than 2.25 calculated Leverage Ratio is less than 2.50 ------------------------------------------------------------------------------------------ Applicable Margin for Eurodollar 100.0 125.0 150.0 Rate Advances (bps) ------------------------------------------------------------------------------------------ ______________________ * In the event of a split rating of greater than one sub-grade, the rating shall be deemed to be one level higher than the lower of the two ratings. 9 Annex II Marsh & McLennan Companies, Inc. Amended $1.0 Billion Revolving Facility (2007) Summary of Terms and Conditions ------------------------------- Capitalized terms used herein and not otherwise defined are used with the meanings set forth in the Commitment Letter to which this Summary of Terms and Conditions is attached. Borrower: Marsh & McLennan Companies, Inc., a Delaware corporation (the 'Borrower'). Facility Amount: $1.0 billion. Type of Facility: Five-year unsecured revolving loan maturing June 13, 2007 (the '2007 Revolving Facility'). Global Coordinator: Citigroup Global Markets Inc. Administrative Agent: JPMorgan Chase Bank (the 'Agent'). Syndication Agent: Citibank, N.A. Documentation Agents: Bank of America, N.A. and Deutsche Bank AG New York Branch. Joint Lead Arrangers: Citigroup Global Markets Inc., Banc of America Securities LLC, and Deutsche Bank Securities Inc. Joint Bookrunners: Citigroup Global Markets Inc. and Deutsche Bank Securities Inc. Lenders: Same Lenders as the Existing 2007 Revolving Facility. Closing Date of Amendments: On or before December 31, 2004. Scope of Amendments: The amendments will implement changes consistent with the terms and provisions of the Term Facility, including, without limitation, the following: (a) Guarantees: Guarantees will be provided by Marsh Inc., Putnam Investments Trust and Mercer Inc. So long as no Default or Event of Default (as defined below) has occurred and is continuing, the guarantees will be released when (i) the Term Facility has been paid in full and discharged, and (ii) the credit rating of the Borrower is at least A- from S&P and A3 from Moody's (in case with stable outlook). 1 (b) Pricing: Margins and fees will be revised as set forth in Exhibit A hereto, and auction rate advances will no longer be available. (c) Financial Covenants: (i) Maximum Total Consolidated Debt to EBITDA at levels to be mutually agreed, and (ii) Minimum Fixed Charge Coverage Ratio at levels to be mutually agreed. (d) Negative Covenants: Same as Term Facility, including limitations on liens, additional subsidiary debt, mergers, significant acquisitions, etc. (e) Master Agreement: Same as Term Facility - e.g., regarding collective voting and pro rata payments under the Facilities in certain circumstances. Annual Agency Fee: As agreed between the Agent and the Borrower. Conditions Precedent to Closing of the Amendment: Same as conditions precedent to closing of Term Facility, including, without limitation, consent of the Required Lenders under the Existing 2007 Revolving Facility. Required Lenders: Required Lenders defined as those holding greater than 50% of outstanding Advances or, if none, commitments. The consent of all or affected Lenders will be required to extend the Maturity Date, decrease interest rates, principal or fees, postpone scheduled payment dates, or for those provisions requiring 100% Lender approval, reduce the percentage of Lenders required to take action, or release guarantors prior to the later of repayment of the Term Facility and December 31, 2006. After such date, guarantors may be released with 66 2/3% Lender approval. Governing Law: State of New York. Counsel to the Arrangers: Shearman & Sterling LLP. 2 Exhibit A to Annex II Pricing Grid 2007 Revolving Facility ==================================================================================== LEVEL I LEVEL II LEVEL III ==================================================================================== BASIS FOR Either (a) Long-Term Level I is not Neither Level I PRICING Senior Unsecured Debt applicable, but nor Level II is rated at least BBB by either (a) Long-Term applicable S&P or Baa2 by Senior Unsecured Moody's,* or (b) most Debt rated at least recently calculated BBB- by S&P and Baa3 Leverage Ratio is by Moody's, or (b) less than 2.25 most recently calculated Leverage Ratio is less than 2.50 -------------------------------------------------------------------------------------- Applicable 82.5 107.5 125.0 Margin for Eurodollar Rate Advances (bps) -------------------------------------------------------------------------------------- Facility Fee 17.5 17.5 25.0 (bps) -------------------------------------------------------------------------------------- ______________________ * In the event of a split rating of greater than one sub-grade, the rating shall be deemed to be one level higher than the lower of the two ratings. 3 Annex III Marsh & McLennan Companies, Inc. Amended $700 million Revolving Facility (2009) Summary of Terms and Conditions ------------------------------- Capitalized terms used herein and not otherwise defined are used with the meanings set forth in the Commitment Letter to which this Summary of Terms and Conditions is attached. Borrower: Marsh & McLennan Companies, Inc., a Delaware corporation (the 'Borrower'). Facility Amount: $700.0 million. Type of Facility: Five-year unsecured revolving loan maturing June 9, 2009 (the '2009 Revolving Facility'). Global Coordinator: Citigroup Global Markets Inc. Administrative Agent: JPMorgan Chase Bank (the 'Agent'). Syndication Agent: Citibank, N.A. Documentation Agents: Bank of America, N.A. and Deutsche Bank AG New York Branch. Joint Lead Arrangers: Citigroup Global Markets Inc., Banc of America Securities LLC, and Deutsche Bank Securities Inc. Joint Bookrunners: Citigroup Global Markets Inc. and Banc of America Securities LLC. Lenders: Same Lenders as the Existing 2009 Revolving Facility. Closing Date of Amendments: On or before December 31, 2004. Scope of Amendments: The amendments will implement changes consistent with the terms and provisions of the Term Facility, including, without limitation, the following: (a) Guarantees: Guarantees will be provided by Marsh Inc., Putnam Investments Trust and Mercer Inc. So long as no Default or Event of Default (as defined below) has occurred and is continuing, the guarantees will be released when (i) the Term Facility has been paid in full and discharged, and (ii) the credit rating of the Borrower is at least A- from S&P and A3 from Moody's (in case with stable outlook). (b) Pricing: Margins and fees will be revised as set forth in Exhibit A 1 hereto, and auction rate advances will no longer be available. (c) Financial Covenants: (i) Maximum Total Consolidated Debt to EBITDA at levels to be mutually agreed, and (ii) Minimum Fixed Charge Coverage Ratio at levels to be mutually agreed. (d) Negative Covenants: Same as Term Facility, including limitations on liens, additional subsidiary debt, mergers, significant acquisitions, etc. (e) Master Agreement: Same as Term Facility - e.g., regarding collective voting and pro rata payments under the Facilities in certain circumstances. Annual Agency Fee: As agreed between the Agent and the Borrower. Conditions Precedent to Closing of the Amendment: Same as conditions precedent to closing of Term Facility, including, without limitation, consent of Required Lenders under the Existing 2009 Revolving Credit Facility. Required Lenders: Required Lenders defined as those holding greater than 50% of outstanding Advances or, if none, commitments. The consent of all or affected Lenders will be required to extend the Maturity Date, decrease interest rates, principal or fees, postpone scheduled payment dates, or for those provisions requiring 100% Lender approval, reduce the percentage of Lenders required to take action, or release guarantors prior to the later of repayment of the Term Facility and December 31, 2006. After such date, guarantors may be released with 66 2/3% Lender approval. Governing Law: State of New York. Counsel to the Arrangers: Shearman & Sterling LLP. 2 Exhibit A to Annex III Pricing Grid 2009 Revolving Facility ==================================================================================== LEVEL I LEVEL II LEVEL III ==================================================================================== BASIS FOR Either (a) Long-Term Level I is not Neither Level I PRICING Senior Unsecured Debt applicable, but nor Level II is rated at least BBB by either (a) Long-Term applicable S&P or Baa2 by Senior Unsecured Moody's,* or (b) most Debt rated at least recently calculated BBB- by S&P and Baa3 Leverage Ratio is by Moody's, or (b) less than 2.25 most recently calculated Leverage Ratio is less than 2.50 -------------------------------------------------------------------------------------- Applicable 82.5 107.5 125.0 Margin for Eurodollar Rate Advances (bps) -------------------------------------------------------------------------------------- Facility Fee 17.5 17.5 25.0 (bps) -------------------------------------------------------------------------------------- ______________________ * In the event of a split rating of greater than one sub-grade, the rating shall be deemed to be one level higher than the lower of the two ratings. 3 This information is provided by RNS The company news service from the London Stock Exchange

Companies

Marsh & Mclennan Cos Inc. (MHM)
UK 100
FTSE quotes by TradingView

Latest directors dealings

All directors dealings today