Summary
Corning Incorporated (GLW) has filed an 8-K report announcing the entry into a new $1.5 billion Credit Agreement, effective August 15, 2018. This new agreement replaces the company's previous $2.0 billion credit facility. The new facility offers flexibility, allowing for borrowings in multiple currencies (USD, GBP, JPY, EUR) and providing the option to increase the commitment by an additional $500 million. Interest rates are based on LIBOR or an alternate base rate plus a margin that adjusts with Corning's debt ratings, ranging from 0.680% to 1.125% for LIBOR and 0.000% to 0.125% for the base rate. The Credit Agreement has a maturity date of August 15, 2023, with potential for two one-year extensions. It includes customary covenants such as financial reporting, maintaining a debt-to-capital ratio not exceeding 0.60, limitations on liens and subsidiary debt, and restrictions on mergers. Importantly, at the time of this filing, there were no outstanding borrowings under the new credit facility, nor were there any under the replaced agreement, indicating a strong liquidity position for the company.
Key Highlights
- 1Corning entered into a new $1.5 billion Credit Agreement, replacing its prior $2.0 billion facility.
- 2The new credit facility allows for borrowings in multiple currencies: Dollars, Sterling, Yen, and Euros.
- 3Corning has the option to increase the facility size by up to $500 million.
- 4Interest rates are tied to LIBOR/EURIBOR or an alternate base rate, with a margin that varies based on the company's credit ratings.
- 5The Credit Agreement matures on August 15, 2023, with potential for extensions.
- 6Key covenants include maintaining a debt-to-capital ratio of no more than 0.60 and limitations on liens and subsidiary debt.
- 7There were no outstanding borrowings under the new credit facility at the time of the filing.