Summary
Lockheed Martin Corporation (LMT) has filed an 8-K report detailing the execution of a new Five-Year Credit Agreement on August 14, 2014. This new agreement establishes a $1.5 billion unsecured revolving credit facility, which can be increased by up to an additional $500 million, bringing the total potential facility size to $2 billion. The facility has a maturity date of August 14, 2019, and replaces a prior credit agreement set to expire in 2016. This new credit facility provides Lockheed Martin with significant financial flexibility for general corporate purposes. Notably, the agreement includes customary covenants, such as restrictions on asset encumbrances and mergers, and a maximum leverage ratio of 65%. The establishment of this new, larger credit facility, with no immediate borrowings or letters of credit drawn, signals the company's proactive approach to managing its liquidity and financial resources, ensuring access to capital for its ongoing operations and strategic initiatives.
Key Highlights
- 1Execution of a new Five-Year Credit Agreement on August 14, 2014.
- 2Establishes a $1.5 billion unsecured revolving credit facility, with an option to increase by up to $500 million ($2 billion total).
- 3The new facility matures on August 14, 2019.
- 4Replaces a previous Five-Year Revolving Credit Agreement dated August 26, 2011, which was terminated without penalty.
- 5The credit facility is available for any lawful corporate purposes.
- 6Includes a maximum leverage ratio covenant of 65%.
- 7No borrowings or letters of credit were outstanding under the new agreement at the time of closing.