What is the primary purpose of issuing these new senior notes?

The primary purpose is to refinance existing debt. Moody's is using the proceeds from the new 3.100% Senior Notes due 2061 to repay or redeem its outstanding $500 million of 4.500% senior unsecured notes which mature in September 2022. This strategy aims to lower interest expenses and extend the company's debt maturity profile.

What are the key terms of the new 3.100% Senior Notes due 2061?

The notes have a principal amount of $500 million, a fixed interest rate of 3.100% per year, and mature on November 29, 2061. Interest payments are due semi-annually on May 29 and November 29 each year, starting May 29, 2022. The company has options for redemption under certain conditions, and holders may have the option to require the company to purchase the notes upon a 'Change of Control Triggering Event'.

What are some of the restrictions or covenants associated with these new notes?

The Indenture governing the notes contains covenants that limit Moody's and certain of its subsidiaries' ability to incur liens, enter into sale and leaseback transactions, or consolidate or merge with another entity or sell substantially all of its assets. These covenants are designed to protect the interests of the noteholders.

What are the conditions for default and potential acceleration of the notes?

An event of default can occur if Moody's or certain subsidiaries fail to pay the principal on other indebtedness totaling $50 million or more when due, or if a default leads to the acceleration of such indebtedness. Upon an event of default, the notes may become immediately due and payable either automatically or at the request of holders representing more than 25% of the principal amount.

MCO 8-K SEC Disclosure — Nov 30, 2021

Summary

Moody's Corporation (MCO) has announced the successful closing of its public offering of $500 million in 3.100% Senior Notes due 2061 on November 29, 2021. This offering was registered under a previously filed Form S-3. The net proceeds from this issuance are earmarked for repaying or redeeming the company's outstanding $500 million of 4.500% senior unsecured notes due in September 2022. The issuance of these new notes, which mature in 2061 and bear a fixed interest rate of 3.100%, represents a strategic move by Moody's to refinance existing debt with a lower interest rate and extend its maturity profile. The new notes are governed by an Indenture, which includes provisions for redemption, purchase upon a change of control, and covenants that limit the company's ability to incur liens or enter into certain transactions.

Key Highlights

1Closed public offering of $500 million in 3.100% Senior Notes due 2061.
2Proceeds will be used to repay/redeem $500 million of 4.500% senior unsecured notes due September 2022.
3New notes mature on November 29, 2061.
4Interest on the new notes is fixed at 3.100% per annum, payable semi-annually.
5The Indenture includes provisions for redemption at the company's option and mandatory purchase upon a 'Change of Control Triggering Event'.
6Covenants in the Indenture limit liens, sale and leaseback transactions, and consolidation/merger.
7Events of default include failure to pay principal on other indebtedness of $50 million or more, or acceleration of such indebtedness.

MOODYS CORP /DE/ 8-K Report, Corporate Update (Nov 30, 2021)

Summary

Key Highlights

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