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Salesforce, Inc. 8-K Report, Material Agreement (Apr 30, 2018)

Reports
Material Agreements·Financial Events·Exhibits & Filings
Filing Date
Filed April 30, 2018
Period End
April 30, 2018
Security
CRM
In the record · 2016–202610-K1110-Q328-K144

CRM filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 144 current reports (8-K) between 2016 and 2026.

  1. Leadership change8-K · Jun ’17Jun ’17
  2. Material agreement8-K · Dec ’20Dec ’20
  3. Restructuring8-K · Jan ’23Jan ’23
  4. Leadership change8-K · Sep ’26Sep ’26

01—Abstract

Summary

Summary of the 8-K filed April 30, 2018. Cited figures are marked; the original filing is the authoritative source.

This Form 8-K filing by Salesforce, Inc. (CRM) on April 30, 2018, primarily details the entry into new credit agreements and provides updates on the ongoing acquisition of MuleSoft, Inc. The company entered into a Second Amended and Restated Credit Agreement establishing a five-year, unsecured, multicurrency revolving credit facility with an initial aggregate commitment of $1.0 billiona.

Additionally, Salesforce amended and restated its existing term loan agreement and entered into a new acquisition term loan agreement for up to $500 millionb to finance a portion of the cash consideration for the MuleSoft acquisition and associated transaction costs. These financing arrangements are crucial for supporting Salesforce's strategic growth, particularly the significant acquisition of MuleSoft, which was initiated via an exchange offer on April 2, 2018.

The new credit facilities, with their specified covenants and maturity dates, provide the company with necessary financial flexibility and resources. Investors should note the terms of these agreements, including interest rate calculations, fees, covenants, and events of default, as they impact the company's financial obligations and operational flexibility.

02—Key points

Key Highlights

  1. Salesforce entered into a Second Amended and Restated Credit Agreement for a $1.0 billion unsecured, five-year revolving credit facility.
  2. A new $500 million unsecured Acquisition Term Loan Agreement was established to help finance the acquisition of MuleSoft.
  3. The existing $500 million term loan was amended and restated, maintaining its original maturity date.
  4. These new credit facilities are unsecured and subject to customary covenants, including a Consolidated Leverage Ratio not to exceed 3.50:1.00 (with a potential step-up to 4.50:1.00 after a Material Acquisition).
  5. The filing confirms the ongoing exchange offer for MuleSoft, Inc. shares, which commenced on April 2, 2018, as part of the acquisition process.
  6. Guarantees provided by certain subsidiaries under previous credit agreements were terminated in connection with the new agreements.

03—Questions

Frequently Asked Questions

  1. What is the primary purpose of this 8-K filing?

    This 8-K filing primarily announces Salesforce's entry into new and amended credit agreements, including a significant revolving credit facility and a term loan to finance the acquisition of MuleSoft. It also provides context for the ongoing acquisition process.

  2. How much new debt financing has Salesforce secured?

    Salesforce has secured a $1.0 billion revolving credit facility and a $500 million acquisition term loan. Its existing $500 million term loan was also amended and restated.

  3. What is the status of the MuleSoft acquisition?

    The filing confirms that Salesforce commenced an exchange offer to purchase all shares of MuleSoft on April 2, 2018. The new acquisition term loan is intended to help finance the cash portion of this acquisition.

  4. What are the key financial covenants associated with the new credit agreements?

    A key financial covenant requires that the Consolidated Leverage Ratio not exceed 3.50:1.00 at the end of each fiscal quarter. This ratio can be stepped up to 4.50:1.00 for a certain period following a Material Acquisition.

04—Continue

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