8-KMaterial AgreementsFinancial EventsExhibits & Filings

FEDEX CORP 8-K Report, Material Agreement (Jul 26, 2005)

Filed July 26, 2005For Securities:FDX

Summary

FedEx Corporation (FDX) has filed an 8-K report detailing the entry into a new $1 billion, five-year unsecured revolving credit facility. This new agreement, effective July 20, 2005, replaces and consolidates two prior credit agreements, increasing the company's available liquidity. The facility can be used for general corporate purposes, including commercial paper back-up and acquisitions, and currently has no outstanding borrowings as of the filing date. The new credit facility offers flexibility in interest rate options, allowing FedEx to choose between prime rate-based loans or LIBOR-based loans, with applicable margins tied to the company's credit ratings. The agreement includes standard covenants, such as a maximum leverage ratio of 70%, and provides a clear maturity date of July 20, 2010. This action demonstrates FedEx's proactive management of its capital structure and its commitment to maintaining robust financial flexibility.

Key Highlights

  • 1FedEx entered into a new $1 billion, five-year unsecured revolving credit agreement on July 20, 2005.
  • 2The new agreement consolidates and replaces two previous credit facilities, increasing overall borrowing capacity.
  • 3Funds from the credit facility are available for general corporate purposes, including commercial paper back-up and acquisitions.
  • 4As of July 25, 2005, no borrowings had been drawn under the new credit agreement.
  • 5Interest rates on borrowings can be based on the prime rate or LIBOR, with applicable margins dependent on FedEx's credit ratings.
  • 6The agreement includes customary covenants, such as a maximum leverage ratio of 70%.
  • 7The credit facility matures on July 20, 2010, unless terminated earlier.

Frequently Asked Questions

The main purpose of this 8-K filing is to report the entry into a material definitive agreement, specifically a new $1 billion five-year credit facility for FedEx Corporation.

The new $1 billion credit agreement replaces and consolidates two prior agreements totaling $750 million and $250 million, effectively increasing FedEx's available credit line and simplifying its credit arrangements.

The lenders' commitments under the new credit agreement will terminate on July 20, 2010, unless terminated earlier by FedEx or by the administrative agent upon an event of default.

As of the filing date (July 25, 2005), FedEx had not made any borrowings under the new credit agreement, indicating no immediate drawdowns or financial obligations incurred beyond the agreement itself and associated fees.