8-KMaterial AgreementsFinancial EventsExhibits & Filings

MOODYS CORP /DE/ 8-K Report, Material Agreement (Oct 9, 2007)

Filed October 9, 2007For Securities:MCO

Summary

Moody's Corporation (MCO) announced on October 9, 2007, the establishment of a $1 billion unsecured commercial paper program. This program allows the company to issue commercial paper notes for general corporate purposes, including potential acquisitions and share repurchases. The program is backstopped by a $1 billion senior unsecured revolving credit facility, providing financial flexibility if commercial paper funding is not available on favorable terms. Initially, Moody's expects to issue $400 million in commercial paper to repay existing borrowings under the credit facility. The commercial paper notes will have varying maturities of up to 397 days and will be issued at a discount or with interest rates tied to market conditions. This move indicates Moody's proactive approach to managing its liquidity and funding needs.

Key Highlights

  • 1Moody's Corporation has established a $1 billion unsecured commercial paper program.
  • 2The program allows for the issuance of unsecured commercial paper notes for general corporate purposes.
  • 3Proceeds from the commercial paper can be used for acquisitions and share repurchases.
  • 4The commercial paper program is backed by a $1 billion senior unsecured revolving credit facility.
  • 5The credit facility acts as a backstop, ensuring funding availability on favorable terms.
  • 6Moody's plans to initially issue $400 million in commercial paper to repay existing credit facility borrowings.
  • 7The commercial paper notes will have maturities of up to 397 days and flexible interest rate structures.

Frequently Asked Questions

The primary purpose of the commercial paper program is to provide Moody's Corporation with a flexible source of funding for general corporate purposes, including potential acquisitions and share repurchases. It allows the company to access capital markets efficiently for its ongoing operational and strategic needs.

The commercial paper program is backstopped by Moody's existing $1 billion senior unsecured revolving credit facility. This means that if Moody's cannot secure funding on favorable terms through the commercial paper program, it can utilize the credit facility to access funds. The initial $400 million issuance of commercial paper is intended to repay outstanding borrowings under this credit facility.

The commercial paper notes will be unsecured and can be issued with maturities of up to 397 days from the date of issue. They will be sold at a discount from par or at par with interest rates that vary based on market conditions at the time of issuance. Interest rates for floating rate notes can be based on various benchmarks like CD rate, commercial paper rate, federal funds rate, LIBOR, prime rate, or treasury rate.

The dealers involved in the commercial paper program are Goldman, Sachs & Co., Citigroup Global Markets Inc., and Morgan Stanley & Co. Incorporated. JPMorgan Chase Bank, National Association, will serve as the issuing and paying agent.