8-KMaterial AgreementsFinancial EventsExhibits & Filings

ATMOS ENERGY CORP 8-K Report, Material Agreement (Apr 24, 2020)

Filed April 24, 2020For Securities:ATO

Summary

Atmos Energy Corporation (ATO) announced on April 24, 2020, the entry into a $600 million senior unsecured 364-day revolving credit facility. This facility, with Mizuho Bank, Ltd. as the Administrative Agent, is primarily intended to support the company's working capital needs. This credit line provides Atmos Energy with enhanced financial flexibility, particularly crucial during uncertain economic times. The terms indicate interest rates tied to credit ratings, based on either a base rate or LIBOR, with additional commitment fees on unused portions. The agreement includes standard covenants such as limitations on liens and asset sales, and a key financial ratio requirement: a debt-to-capitalization ratio not exceeding 0.70 to 1.00. This facility will expire on April 22, 2021.

Key Highlights

  • 1Atmos Energy secured a new $600 million senior unsecured 364-day revolving credit facility.
  • 2The primary purpose of the facility is for general working capital.
  • 3The credit facility has a maturity date of April 22, 2021.
  • 4Interest rates are variable, depending on the company's credit rating and choice between a base rate or LIBOR.
  • 5A commitment fee on the unused portion of the facility is applicable.
  • 6The agreement includes covenants such as a debt-to-capitalization ratio limit of 0.70:1.00.
  • 7Mizuho Bank, Ltd. serves as the Administrative Agent for the credit facility.

Frequently Asked Questions

The new $600 million 364-day revolving credit facility is intended to provide Atmos Energy with additional funds for working capital purposes, enhancing its financial flexibility.

The facility has a debt-to-capitalization ratio covenant not to exceed 0.70 to 1.00. Interest rates are variable, based on either a prime rate or LIBOR, plus an applicable margin that adjusts with the company's credit rating. Commitment fees are also charged on the unused portion.

The 364-day revolving credit facility is set to expire on April 22, 2021, at which point all outstanding amounts will be due and payable.

In the event of a default, including cross-defaults on other indebtedness, the lenders can declare all outstanding amounts immediately due and payable. Certain events, such as bankruptcy or insolvency, will automatically trigger this acceleration.