Summary
Marriott International, Inc. (MAR) filed an 8-K on July 19, 2013, to report a material amendment to its revolving credit agreement. The key change is the extension of the agreement's expiration date from June 23, 2016, to July 18, 2018, providing a longer-term liquidity backstop. Additionally, the facility size has been increased from $1.75 billion to $2.00 billion, enhancing Marriott's financial flexibility and borrowing capacity.
Key Highlights
- 1Marriott International amended and restated its multicurrency revolving credit agreement.
- 2The expiration date of the credit agreement has been extended by over two years, from June 23, 2016, to July 18, 2018.
- 3The aggregate effective borrowing capacity under the credit facility has been increased from $1.75 billion to $2.00 billion.
- 4This amendment provides Marriott with extended financial flexibility and a larger liquidity pool.
- 5Borrowings under the agreement generally bear interest at LIBOR plus a spread based on the company's public debt rating.
- 6The filing incorporates by reference the details of the credit agreement amendment into the 'Creation of a Direct Financial Obligation' item.
- 7The primary exhibit filed is the Third Amended and Restated Credit Agreement dated July 18, 2013.
Frequently Asked Questions
The main purpose of this 8-K filing is to report that Marriott International, Inc. has amended and restated its revolving credit agreement, extending its maturity date and increasing its borrowing capacity. This provides the company with enhanced financial flexibility and a longer-term source of liquidity.
The key changes are an extension of the agreement's expiration date from June 23, 2016, to July 18, 2018, and an increase in the total borrowing facility size from $1.75 billion to $2.00 billion.
The amendment strengthens Marriott's financial position by providing a larger pool of readily available funds and extending the duration for which these funds are accessible. This increased flexibility can be used for general corporate purposes, strategic initiatives, or to navigate potential economic uncertainties.
Borrowings generally bear interest at the London Interbank Offered Rate (LIBOR) plus a spread that is determined by Marriott's public debt rating. The company also pays quarterly fees based on its public debt rating.