Summary
Caterpillar Inc. (CAT) reported on September 23, 2009, the establishment of a new US$2.388 billion 364-day unsecured revolving credit facility, effective September 17, 2009. This facility, which matures on September 16, 2010, is intended to serve as an alternative funding source for the company's commercial paper programs, although no borrowings have been made to date. The agreement includes standard representations, warranties, covenants, and events of default, and indicates that facility fees have increased compared to the previous year, reflecting current market conditions. In addition to the new credit line, Caterpillar also executed amendments to three existing credit agreements: a 2009 364-day backup facility, a 2007 five-year facility, and a 2006 five-year facility. These amendments align certain terms and conditions, such as covenants and default provisions, with those of the newly established 364-day facility. The company's proactive approach to maintaining robust liquidity and credit arrangements demonstrates a focus on financial flexibility during a period of economic uncertainty.
Key Highlights
- 1Establishment of a new US$2.388 billion 364-day unsecured revolving credit facility.
- 2The new facility matures on September 16, 2010, and serves as an alternative funding source for commercial paper.
- 3No borrowings have been made under the new facility as of the report date.
- 4Facility fees have increased compared to 2008, reflecting prevailing market conditions.
- 5Amendments were made to three existing credit agreements (2009, 2007, 2006) to align terms with the new facility.
- 6The amendments ensure consistency in covenants, conditions precedent, representations, warranties, and events of default across key credit facilities.