01—Abstract
Summary
Summary of the 8-K filed April 18, 2022. Cited figures are marked; the original filing is the authoritative source.
Expedia Group, Inc. (EXPE) has announced the entry into a new, unsecured Revolving Credit Facility totaling $2.5 billiona, maturing on April 14, 2027.
This facility replaces and terminates prior credit agreements dated May 5, 2020, and August 5, 2020. The new credit facility is guaranteed by certain material domestic subsidiaries and includes a letter of credit sublimit of $120 millionb. Interest rates are variable, based on an index rate plus a margin dependent on Expedia's credit ratings, ranging from 0.00% to 1.75% for different loan types.
Additionally, there are participation fees for outstanding letters of credit and commitment fees for undrawn amounts, also tied to credit ratings. The facility contains customary covenants, including a maximum consolidated leverage ratio requirement, with events of default potentially leading to commitment termination and acceleration of borrowings. This move signals a refinancing and potential strengthening of Expedia's liquidity and financial flexibility.
02—Key points
Key Highlights
- Expedia entered into a new $2.5 billion unsecured Revolving Credit Facility, maturing in April 2027.
- The new facility terminates and replaces prior credit agreements dated May 5, 2020, and August 5, 2020.
- The credit facility is guaranteed by certain material domestic subsidiaries of Expedia.
- Interest rates on borrowings are variable and dependent on Expedia's credit ratings.
- The facility includes customary covenants, notably a maximum consolidated leverage ratio.
- This action likely enhances Expedia's liquidity and financial flexibility.
03—Questions
Frequently Asked Questions
What is the principal amount and maturity date of the new Revolving Credit Facility?
The new Revolving Credit Facility has aggregate commitments totaling $2.5 billion and matures on April 14, 2027.
What are the key covenants associated with this new credit facility?
The Revolving Credit Facility contains customary affirmative and negative covenants, representations, warranties, and events of default. A key requirement is that the Company must not exceed a specified maximum consolidated leverage ratio at the end of each fiscal quarter.
Why did Expedia terminate its previous credit agreements?
Expedia terminated its previous credit agreements in connection with entering into the new, larger Revolving Credit Facility, likely to consolidate debt, potentially achieve better terms, and enhance its overall financial structure.
Are there any fees associated with the new Revolving Credit Facility?
Yes, there are fees. A participation fee is payable for outstanding letters of credit, and a commitment fee is payable quarterly for undrawn commitments. Both fees vary based on Expedia's credit ratings.
04—Continue