Summary
Marriott International, Inc. (MAR) has filed an 8-K report detailing a significant amendment to its credit agreement. On June 10, 2016, the company entered into a Fourth Amended and Restated Credit Agreement, which substantially enhances its financial flexibility. Key among these changes is the doubling of the revolving credit facility size from $2.00 billion to $4.00 billion, with the full amount becoming available upon the closing of the then-pending acquisition of Starwood Hotels & Resorts Worldwide, Inc. This enhanced credit facility also features an extended maturity date, pushing it from July 2018 to June 2021. Furthermore, the agreement allows for pro forma adjustments related to acquisitions and includes carve-outs for cash designated for the Starwood Acquisition, providing Marriott with greater operational and strategic maneuverability. These amendments are crucial for investors to understand as they directly impact the company's liquidity and its ability to fund significant corporate actions.
Key Highlights
- 1Marriott International entered into a Fourth Amended and Restated Credit Agreement on June 10, 2016.
- 2The revolving credit facility size was increased from $2.00 billion to $4.00 billion.
- 3The full $4.00 billion facility becomes available upon the closing of the Starwood Hotels & Resorts acquisition.
- 4The maturity date of the credit agreement was extended from July 18, 2018, to June 10, 2021.
- 5The agreement permits pro forma effect for material acquisitions, aiding in financial planning for growth.
- 6Certain cash amounts designated for the Starwood Acquisition are carved out from Adjusted Total Debt calculations.
- 7The definition of 'Permitted Liens' was updated to allow for higher aggregate principal amounts of secured indebtedness.