Summary
Amgen Inc. (AMGN) announced on December 12, 2019, that it entered into a second amended and restated revolving credit agreement, significantly enhancing its financial flexibility. This agreement establishes a total commitment of $2.5 billion, with the option to increase it by an additional $750 million, providing substantial liquidity for general corporate purposes and serving as a backstop for its commercial paper program. The new credit facility has an initial five-year term, extendable for two additional one-year periods, offering long-term stability. The terms of the agreement include competitive interest rates tied to Amgen's senior debt rating and a commitment fee. It also features customary covenants and financial maintenance requirements, such as a minimum consolidated interest coverage ratio, which are standard for corporate financing agreements.
Key Highlights
- 1Amgen entered into a Second Amended and Restated Revolving Credit Agreement on December 12, 2019.
- 2The agreement provides a total commitment of $2.5 billion, with an option to increase by up to $750 million.
- 3The credit facility is available for general corporate purposes and serves as a liquidity backstop for Amgen's commercial paper program.
- 4The initial term of the revolving credit agreement is five years, with potential extensions.
- 5Interest rates are variable, based on either LIBOR or a base rate, plus a margin dependent on Amgen's senior long-term unsecured debt rating.
- 6A commitment fee is payable for both used and unused portions of the credit facility.
- 7The agreement includes customary affirmative and negative covenants and requires maintenance of a minimum consolidated interest coverage ratio.