The notes were priced at issue prices ranging from 99.697% to 99.994% of face value, with underwriting discounts ranging from 0.300% (2026 notes) to 0.875% (2055 notes). Total proceeds to the company before expenses were approximately $4,167,288,000 after underwriting discounts of $24,700,000 on $4,191,988,000 of gross proceeds (aggregate principal across the six tranches is $4.2 billion). The notes are senior unsecured obligations that rank equally with the company's other senior unsecured indebtedness and were not listed on any securities exchange. They were issued under the company's existing Indenture dated September 18, 2014 with U.S. Bank Trust Company, National Association (as successor trustee), as supplemented by a Sixth Supplemental Indenture dated June 23, 2025.
The company intends to use the net proceeds of the notes, together with net proceeds of a concurrent common stock offering (43,137,254 shares priced at $102.00 per share for gross proceeds of approximately $4.3 billion, announced the same day) and cash on hand, to fund the cash consideration payable under its previously announced Agreement and Plan of Merger to acquire RSC Topco, Inc., the holding company for Accession Risk Management Group, Inc., together with Encore Merger Sub, Inc. and Kelso RSC (Investor), L.P. as equityholder representative. Pending application, net proceeds are expected to be invested in investment-grade securities, money market funds, bank deposits or similar short-term instruments.
Five of the six tranches (the 2026, 2028, 2030, 2032 and 2055 notes, defined as the "SMR Notes") are subject to a special mandatory redemption feature: if the RSC acquisition is not consummated by the later of March 10, 2026 (extendable to June 10, 2026 under the merger agreement) and five business days after any further extension of the merger agreement's expiration date, or if Brown & Brown notifies the trustee the merger agreement has been terminated, the company must redeem all SMR Notes at 101% of principal plus accrued and unpaid interest. The 2035 notes are not subject to this special mandatory redemption and will remain outstanding regardless of whether the acquisition closes, with proceeds from that tranche to be used for general corporate purposes if the deal falls through. There is no escrow account or security interest securing the special mandatory redemption obligation.
Aside from the special mandatory redemption, the company may optionally redeem each series of notes, in whole or in part, prior to a par call date specific to each tranche (ranging from the notes' maturity for the 2026 notes to six months before maturity for the 2055 notes) at a make-whole price equal to the greater of the present value of remaining payments discounted at the Treasury Rate plus a spread ranging from 10 basis points (2026 notes) to 25 basis points (2055 notes), or par, plus accrued interest. On or after the applicable par call date, notes are redeemable at par plus accrued interest. If a Change of Control Triggering Event occurs, the company must offer to repurchase the notes from holders; the prospectus supplement defines "Investment Grade" by reference to Fitch, Moody's and S&P rating thresholds for purposes of that covenant, but no specific issuer or issue credit rating assigned by any rating agency to these notes is disclosed in the filings reviewed.
BofA Securities, Inc. and J.P. Morgan Securities LLC acted as lead book-running managers for the notes offering. BMO Capital Markets, Truist Securities, Fifth Third Securities, PNC Capital Markets LLC, US Bancorp, Wells Fargo Securities and Morgan Stanley served as additional book-running managers, and Citizens Capital Markets served as the sole co-manager (Morgan Stanley is an additional book-running manager, not a separate co-manager, per the final prospectus supplement). Holland & Knight LLP, Orlando, Florida, passed on the validity of the notes for Brown & Brown, and Sidley Austin LLP, New York, acted as counsel to the underwriters.
The notes offering itself closed on June 23, 2025 and is not contingent on completion of the RSC acquisition; the acquisition was pending regulatory approval as of the pricing date, and the special mandatory redemption mechanics tie five of the six tranches to the outcome of that separate, still-pending transaction. No information was found in the reviewed filings regarding specific credit ratings assigned to the notes by Fitch, Moody's or S&P.