UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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):
April 20, 2006
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United Parcel Service, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 001-15451 58-2480149
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(State or other (Commission (IRS Employer
jurisdiction File Number) Identification Number)
of incorporation)
55 Glenlake Parkway, N.E.
Atlanta, Georgia 30328
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (404) 828-6000
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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):
[ ] 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))
Item 1.01. Entry into a Material Definitive Agreement.
The information included pursuant to Item 2.03 is incorporated under
this Item 1.01.
Item 1.02. Termination of a Material Definitive Agreement.
As of April 20, 2006, in connection with our entry into the new credit
facility described in Item 2.03 hereof, we terminated the $1.0 billion 364-day
revolving facility, dated as of April 21, 2005, with the banks, financial
institutions and other institutional lenders signatory thereto, and Citibank,
N.A as administrative agent. The prior credit facility expired on April 20,
2006.
Item 2.02 - Results of Operations and Financial Condition.
On April 20, 2006, United Parcel Service, Inc. issued a press release
containing information about the Company's results of operations for the first
quarter ended March 31, 2006. A copy of the press release is attached hereto as
Exhibit 99.1.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation Under an
Off-Balance Sheet Arrangement of a Registrant.
On April 20, 2006, we entered into a new $1.0 billion 364-Day revolving
credit facility (the "364-Day Facility") with a syndicate of commercial banks,
including Citibank, N.A. as administrative agent ("Citibank" or the "Agent").
The material terms and conditions of the 364-Day Facility are as set forth
below.
THE 364-DAY FACILITY
Generally, amounts outstanding under the 364-Day Facility bear interest
at a "base rate." For U.S. Dollar advances, the base rate is a fluctuating rate
equal to Citibank's base rate and for non-U.S. Dollar advances a periodic fixed
interest rate equal to LIBOR for the applicable currency plus a margin equal to
0.130%. Interest on both U.S. Dollar and non-U.S. Dollar denominated advances
are payable quarterly and in arrears.
The 364-Day Facility will mature and all amounts outstanding thereunder
will be due and payable on April 19, 2007, provided, however, that we may
request renewal of the facility for an additional 364-day period or convert all
amounts outstanding thereunder into a three-year term loan which would mature on
April 19, 2010. Should we exercise our option to convert advances under the
364-Day Facility into such a term loan, U.S. Dollar advances would continue to
bear interest at the same rate discussed above. Non-U.S. Dollar advances would
also continue to bear interest at a fixed periodic rate equal to LIBOR for the
applicable currency, however, the applicable margin would increase to 0.250%.
We may request the Agent to solicit competitive bids from the lenders
under the 364-Day Facility for advances with requested maturities of at least
seven days. Each of such lenders may bid at its discretion. We may accept one or
more of such bids, provided that the aggregate outstanding advances on the date
of, and after giving effect to, the competitive bid advance does not exceed the
aggregate commitments of all lenders under the 364-Day Facility. Each such
competitive bid advance must be at least $25 million and may be increased in
multiples of $1.0 million. While any such borrowing is outstanding, it will be
deemed a usage of the 364-Day Facility with regard to availability thereunder.
We are required to pay certain fees in connection with the 364-Day
Facility. For example, we must pay an annual facility fee quarterly in arrears
equal to 0.02% of the aggregate $1.0 billion commitment of the lenders under the
364-Day Facility. Generally, however, we may reduce the aggregate commitment of
such lenders by terminating any unused amounts under the 364-Day Facility on
three days notice. Such reductions must be at least $25 million and are subject
to certain restrictions. We may also be required to pay certain fees to the
Agent, as we and the Agent may agree on from time-to-time, such as in connection
with a competitive bid advance.
The 364-Day Facility contains customary covenants regarding the
preservation and maintenance of our corporate existence, material compliance
with laws, payment of taxes, and maintenance of insurance and of our properties.
The 364-Day Facility also generally restricts us from incurring any secured
indebtedness without making provision for indebtedness under the Credit Facility
to be secured equally and ratably with such secured indebtedness, and from
entering into certain sale-leaseback transactions. Further, the 364-Day Facility
generally requires that we maintain a consolidated minimum net worth of $3.0
billion. The 364-Day Facility includes customary events of default, including,
but not limited to, the failure to pay any interest, principal or fees when due,
the failure to perform any covenant or agreement, inaccurate or false
representations or warranties, insolvency or bankruptcy, change of control, the
occurrence of certain ERISA events and judgment defaults.
We plan to use the proceeds from the 364-Day Facility for general
corporate purposes, including commercial paper backstop.
Item 9.01 - Financial Statements and Exhibits
(c) Exhibits
99.1 Press release dated April 20, 2006
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.
UNITED PARCEL SERVICE, INC.
Date: April 24, 2006 By: /s/ D. Scott Davis
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Name: D. Scott Davis
Title: Senior Vice President, Treasurer
and Chief Financial Officer
EXHIBIT INDEX
99.1 Press Release dated April 20, 2006