Summary
Air Products and Chemicals, Inc. (APD) filed an 8-K on March 31, 2017, to announce the execution of a new five-year revolving credit agreement, referred to as the "2017 Credit Agreement." This new facility provides up to $2.5 billion in senior unsecured debt, available to the company and its subsidiaries, enhancing its liquidity and supporting its commercial paper program. The company has provided an unconditional guarantee for loans made to its subsidiary borrowers under this new agreement. This 2017 Credit Agreement replaces a previous $2.69 billion revolving credit agreement dated April 30, 2013. Notably, there were no outstanding borrowings under the prior agreement at the time of its termination, and no early termination penalties were incurred. As of the filing date, no borrowings had been made under the new 2017 Credit Agreement, and no material direct financial obligations had yet been created. The agreement includes standard default provisions and a single financial covenant related to the maximum ratio of total debt to capitalization.
Key Highlights
- 1Air Products entered into a new five-year, $2.5 billion revolving credit agreement (2017 Credit Agreement) effective March 31, 2017.
- 2The new credit facility is for senior unsecured debt and is available to both the company and its subsidiaries.
- 3The agreement serves as a source of liquidity and supports the company's commercial paper program.
- 4Air Products provides an unconditional guarantee for subsidiary borrowings under the 2017 Credit Agreement.
- 5The new agreement replaces a prior $2.69 billion revolving credit agreement from April 2013.
- 6There were no outstanding borrowings under the previous agreement at termination, and no early termination penalties were incurred.
- 7The only financial covenant is a maximum ratio of total debt to capitalization.