8-KMaterial AgreementsFinancial EventsExhibits & Filings

ATMOS ENERGY CORP 8-K Report, Material Agreement (Nov 13, 2006)

Filed November 13, 2006For Securities:ATO

Summary

Atmos Energy Corporation (ATO) has filed an 8-K report detailing the execution of a new $300 million Revolving Credit Agreement, a 364-day facility, which became effective on November 7, 2006. This new facility replaces a similar agreement that was set to expire on November 8, 2006, and it will work in conjunction with the company's existing $600 million working capital facility. The primary purpose of this credit line is to provide additional working capital to support the company's operations. The terms of the new credit facility are largely consistent with previous agreements. Interest rates will be variable, based on the company's credit ratings and linked to either a base rate or LIBOR. Commitment and utilization fees will also apply, with rates dependent on credit ratings and usage levels. The facility matures on November 5, 2007, and includes standard covenants limiting liens, asset sales, and mergers, as well as a debt-to-capitalization ratio limit of 0.70:1.00, with specific exclusions for pension liabilities and hybrid securities.

Key Highlights

  • 1Atmos Energy entered into a new $300 million, 364-day revolving credit facility on November 7, 2006.
  • 2This facility is intended to provide additional working capital for the company.
  • 3The new credit agreement replaces a similar $300 million facility that was due to expire in November 2006.
  • 4The credit facility supplements an existing $600 million working capital facility.
  • 5Interest rates are variable, tied to credit ratings, and can be based on LIBOR or a base rate.
  • 6The agreement includes covenants such as a debt-to-capitalization ratio not exceeding 0.70 to 1.00.
  • 7The credit facility is set to expire on November 5, 2007.

Frequently Asked Questions

The new $300 million revolving credit agreement is intended to provide additional working capital to Atmos Energy Corporation, supplementing its existing financing arrangements.

The credit facility expires on November 5, 2007, at which point all outstanding amounts will be due and payable.

Borrowings will bear interest at a rate dependent on Atmos Energy's credit ratings. These rates can be based on a choice between a base rate or LIBOR, with LIBOR-based borrowings typically ranging from LIBOR plus 0.300% to 0.750%. Based on current ratings at the time of the filing, LIBOR-based borrowings would be at LIBOR plus 0.450%.

Yes, the credit facility includes customary covenants. Notably, it requires the company's debt-to-capitalization ratio to be less than or equal to 0.70 to 1.00 at the end of each fiscal quarter, with specific exclusions for pension liabilities and certain hybrid securities.