On July 1, 2022, Capri Holdings Limited (the “Company”)
entered into a credit facility (the “2022 Credit Facility”) with, among others, JPMorgan Chase Bank, N.A. (“JPMorgan
Chase”), as administrative agent (in such capacity, the “Administrative Agent”), which refinanced its existing senior
unsecured revolving credit facility. The Company, a U.S. subsidiary of the Company, a Canadian subsidiary of the Company, a Dutch subsidiary
of the Company and a Swiss subsidiary of the Company are the borrowers under the 2022 Credit Facility, and the borrowers and certain subsidiaries
of the Company provide unsecured guaranties of the 2022 Credit Facility. The 2022 Credit Facility provides for a $1.5 billion revolving
credit facility, which may be denominated in U. S. Dollars and other currencies, including Euros, Canadian Dollars, Pounds Sterling, Japanese
Yen and Swiss Francs. The Revolving Credit Facility also includes sub-facilities for the issuance of letters of credit of up to $125 million
and swing line loans at the Administrative Agent’s discretion of up to $100 million. The Company has the ability to expand its borrowing
availability under the 2022 Credit Facility in the form of increased revolving commitments or one or more tranches of term loans by up
to an additional $500 million, subject to the agreement of the participating lenders and certain other customary conditions.
Borrowings under the 2022 Credit Facility bear interest, at the Company’s
option, at (i) for loans denominated in U.S. Dollars, (A) an alternate base rate, which is the greatest of (x) the prime rate publicly
announced from time to time by JPMorgan Chase, (y) the greater of the federal funds effective rate and the Federal Reserve Bank of New
York overnight bank funding rate and zero, plus 50 basis points, and (z) the greater of term SOFR for an interest period of one month
plus 10 basis points and zero, plus 100 basis points, (B) the greater of term SOFR for the applicable interest period plus 10 basis points
(“Adjusted Term SOFR”) and zero or (C) the greater of daily simple SOFR plus 10 basis points and zero; (ii) for loans denominated
in Pounds Sterling, the greater of SONIA and zero; (iii) for loans denominated in Swiss Francs, the greater of SARON and zero; (iv) for
loans denominated in Euro, the greater of EURIBOR for the applicable interest period adjusted for statutory reserve requirements (“Adjusted
EURIBOR Rate”) and zero; (v) for loans denominated in Canadian Dollars, the greater of the rate applicable to Canadian Dollar Canadian
banker’s acceptances quoted on Reuters for the applicable interest period adjusted for statutory reserve requirements (“Adjusted
CDOR Rate”) and zero; and (vi) for loans denominated in Japanese Yen, the greater of TIBOR for the applicable interest period adjusted
for statutory reserve requirements (“Adjusted TIBOR Rate”) and zero; in each case, plus an applicable margin based on the
Company’s public debt ratings and/or net leverage ratio.
The 2022 Credit Facility provides for an annual administration fee
and a commitment fee equal to 7.5 basis points to 17.5 basis points per annum, based on the Company’s public debt ratings and/or
net leverage ratio, applied to the average daily unused amount of the 2022 Credit Facility.
Loans under the 2022 Credit Facility may be prepaid and commitments
may be terminated or reduced by the borrowers without premium or penalty other than customary “breakage” costs with respect
to loans bearing interest based upon Adjusted Term SOFR, the Adjusted EURIBOR Rate, the Adjusted CDOR Rate and the Adjusted TIBOR Rate.
The 2022 Credit Facility requires the Company to maintain a net leverage
ratio as of the end of each fiscal quarter of no greater than 4.0 to 1. Such net leverage ratio is calculated as the ratio of the sum
of total indebtedness as of the date of the measurement plus the capitalized amount of all operating lease obligations, minus unrestricted
cash and cash equivalents not to exceed $200,000,000, to Consolidated EBITDAR (as defined below) for the last four consecutive fiscal
quarters. Consolidated EBITDAR is defined as consolidated net income plus provision for taxes based on income, profits or capital, net
interest expense, depreciation and amortization expense, consolidated rent expense and other non-cash losses, charge and expenses, subject
to certain additions and deductions. The 2022 Credit Facility also includes covenants that limit additional indebtedness, liens, acquisitions
and other investments, restricted payments and affiliate transactions.
The 2022 Credit Facility contains events of default customary for financings
of this type, including, but not limited to, payment defaults, material inaccuracy of representations and warranties, covenant defaults,
cross-defaults to certain indebtedness, certain events of bankruptcy or insolvency, certain events under ERISA, material judgments, actual
or asserted failure of any guaranty supporting the 2022 Credit Facility to be in full force and effect, and changes of control. If such
an event of default occurs and is continuing, the lenders under the 2022 Credit Facility would be entitled to take various actions, including,
but not limited to, terminating the commitments and accelerating amounts outstanding under the 2022 Credit Facility.
In the ordinary course of their business, the lenders and certain of
their affiliates have in the past or may in the future engage in investment and commercial banking or other transactions of a financial
nature with the Company or its affiliates, including the provision of certain advisory services and the making of loans to the Company
and its affiliates.
This summary does not purport to be complete and is qualified in its
entirety by reference to the 2022 Credit Facility, which is attached hereto as Exhibit 10.1 and incorporated herein by reference.
Termination of a Material Definitive Agreement
The 2022 Credit Facility replaces the Company’s prior credit
facility with, among others, JPMorgan Chase as administrative agent, as described in Item 1.01 of the Company’s Current Report on
Form 8-K filed with the Securities and Exchange Commission on August 23, 2017 and which description is incorporated by reference in this
Item 1.02, and which was terminated effective as at the closing of the 2022 Credit Facility.
Creation of a Director Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant
The information contained in Item 1.01 above regarding
the 2022 Credit Facility is hereby incorporated by reference into this Item 2.03.
Financial Statements and Exhibits
The Company hereby furnishes the following exhibits
described above in Item 1.01:
Third Amended and Restated Credit Agreement dated as of July 1, 2022 among Capri Holdings Limited, Michael Kors (USA), Inc., the foreign subsidiary borrowers party thereto, the guarantors party thereto, the financial institutions party thereto as lenders and issuing banks and JPMorgan Chase Bank, N.A., as administrative agent.
The cover page from this Current Report on Form 8-K, formatted in Inline XBRL.
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, thereunto duly authorized.
CAPRI HOLDINGS LIMITED
Date: July 1, 2022
/s/ Thomas J. Edwards, Jr.
Thomas J. Edwards, Jr.
Executive Vice President, Chief Financial Officer and Chief Operating Officer
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