Summary
Fiserv, Inc. (FISV) has filed an 8-K report on October 4, 2010, to disclose the execution of a new Credit Agreement on September 29, 2010. This agreement replaces their previous $900 million revolving credit facility with a new $1 billion facility, which can be expanded up to $1.35 billion under certain conditions. The new facility is intended for general corporate purposes and matures on September 29, 2014. Key terms of the Credit Agreement include covenants related to the company's leverage (consolidated indebtedness to EBITDA ratio of no more than 3.5x) and interest coverage (EBITDA to consolidated interest expense ratio of at least 3x). While the borrowings are unsecured, certain material domestic subsidiaries will provide unconditional guarantees. The agreement also includes standard events of default, which could lead to accelerated repayment of obligations.
Key Highlights
- 1Fiserv entered into a new $1 billion revolving credit facility on September 29, 2010, replacing a previous $900 million facility.
- 2The new credit facility has a maturity date of September 29, 2014.
- 3The facility's maximum amount can be increased to up to $1.35 billion, subject to specific conditions.
- 4The funds from the new credit facility are designated for general corporate purposes.
- 5The agreement includes financial covenants, such as limiting consolidated indebtedness to 3.5x EBITDA and maintaining an EBITDA to interest expense ratio of at least 3x.
- 6Borrowings under the Credit Agreement are unsecured, but supported by guarantees from material domestic subsidiaries.
- 7Standard events of default are included, with the potential for immediate acceleration of debt repayment.