Summary
Darden Restaurants, Inc. (DRI) announced on October 24, 2023, the entry into a new $1.25 billion senior unsecured revolving credit facility, replacing its previous agreement. This new Credit Agreement, effective October 23, 2023, matures in five years on October 23, 2028, and provides significant financial flexibility for working capital, capital expenditures, debt refinancing, acquisitions, and general corporate purposes. The facility includes customary covenants, such as limitations on liens and subsidiary debt, and a maximum consolidated total debt to total capitalization ratio of 0.75 to 1.00. Interest rates and fees will be based on prevailing market rates and Darden's credit ratings. The termination of the prior credit agreement, under which no amounts were outstanding, was effective upon the new agreement's commencement, signaling a proactive approach to managing its debt structure and liquidity.
Key Highlights
- 1Darden entered into a new $1.25 billion revolving credit facility, enhancing its financial flexibility.
- 2The new Credit Agreement has a five-year term, maturing on October 23, 2028.
- 3Proceeds from the facility can be used for working capital, capital expenditures, debt refinancing, acquisitions, and general corporate purposes.
- 4The agreement is senior unsecured and includes standard covenants, such as a maximum debt-to-capitalization ratio of 0.75:1.00.
- 5The new facility replaced a prior $1 billion credit agreement, which was terminated with no outstanding borrowings.
- 6A sublimit of $150 million is available for the issuance of letters of credit.
- 7Interest rates and fees are variable, tied to market conditions and Darden's credit ratings.