Summary
Dover Corporation (DOV) has announced the execution of a new $1 billion, five-year unsecured revolving credit facility, replacing a similar existing facility. This new credit agreement, effective November 10, 2011, provides significant liquidity and financial flexibility for the company, with the potential to increase the facility size by an additional $500 million. The primary purpose of this facility is to serve as backup liquidity for Dover's commercial paper program, ensuring operational stability. The new credit facility maintains substantially the same terms as the prior agreement, including covenants and restrictions, indicating continuity in Dover's financial strategy and risk management. These terms involve limitations on asset liens, consolidations, mergers, asset sales, and business line changes, along with financial covenants such as a minimum interest coverage ratio and a debt-to-net worth limitation for subsidiaries. The credit facility matures on November 10, 2016, with provisions for early termination and acceleration in the event of default.
Key Highlights
- 1Dover Corporation entered into a new $1 billion, five-year unsecured revolving credit facility on November 10, 2011.
- 2This facility replaces a similar existing credit agreement, providing continuity in financial arrangements.
- 3The credit facility has an option to increase commitments by an additional $500 million.
- 4The primary use of the facility is as liquidity back-up for Dover's commercial paper program.
- 5The new agreement matures on November 10, 2016.
- 6Key financial covenants include a minimum interest coverage ratio of 3.00:1.00 and limitations on subsidiary debt to net worth.
- 7The terms and conditions, including restrictions and events of default, are substantially similar to the replaced facility.