8-KFinancial EventsOther EventsExhibits & Filings

CATERPILLAR INC 8-K Report, Financial Obligation (Aug 20, 2012)

Filed August 20, 2012For Securities:CAT

Summary

Caterpillar Inc. (CAT) filed an 8-K on August 20, 2012, to report on the issuance of new debt securities. Specifically, on August 15, 2012, the company issued approximately $801.6 million in aggregate principal amount of 3.803% Debentures due 2042. This issuance was part of an early settlement for offers to exchange existing debentures and senior notes for a combination of these new debentures and cash. The company also entered into a Registration Rights Agreement concerning these new debentures, which grants holders certain exchange and registration rights. These debentures were issued under exemptions from the registration requirements of the Securities Act of 1933. For investors, this filing indicates a proactive approach to managing its debt structure and potentially optimizing its cost of capital through an exchange offer.

Key Highlights

  • 1Caterpillar issued approximately $801.6 million in 3.803% Debentures due 2042 on August 15, 2012.
  • 2The issuance was a result of an early settlement for previously announced debt exchange offers.
  • 3The new debentures were exchanged for a mix of new debt and cash.
  • 4The debentures were issued under exemptions from the Securities Act of 1933 registration requirements.
  • 5A Registration Rights Agreement was executed, providing holders with exchange and registration rights.
  • 6This action suggests Caterpillar is actively managing its outstanding debt obligations.

Frequently Asked Questions

The primary purpose of this 8-K filing was to report the creation of a direct financial obligation, specifically the issuance of approximately $801.6 million in new 3.803% Debentures due 2042 by Caterpillar Inc. on August 15, 2012.

Caterpillar issued these new debentures as part of the early settlement of its previously announced offers to exchange certain of its outstanding debentures and senior notes. Investors in those offers received a combination of the new debentures and cash.

The newly issued debentures have an aggregate principal amount of $801,649,000, carry a coupon rate of 3.803%, and mature in 2042. They were issued pursuant to an Indenture dated May 1, 1987, as amended.

The Registration Rights Agreement grants holders of the new debentures certain exchange and registration rights. This is common in debt issuances made under exemptions from registration, ensuring that holders have mechanisms to potentially resell their securities or have them registered for public trading under certain conditions.