Summary
Motorola Solutions, Inc. (MSI) filed an 8-K on June 2, 2014, to report the entry into a new $2 billion revolving credit facility, replacing its prior agreement. This new facility, effective May 29, 2014, has a maturity date of May 29, 2019, with options for two one-year extensions, and includes a $500 million letter of credit sublimit. It provides the company with significant financial flexibility for general corporate purposes, including the ability to increase commitments up to $2.75 billion under certain conditions. Importantly, the company terminated its old credit agreement concurrently with the new one, incurring no outstanding borrowings or early termination penalties. This move signals proactive financial management, ensuring access to a robust credit line while maintaining favorable terms. Investors should view this as a positive step in strengthening the company's liquidity and financial maneuverability.
Key Highlights
- 1Entered into a new $2 billion revolving credit agreement maturing on May 29, 2019.
- 2The new credit facility includes an option to extend the maturity date for up to two one-year periods.
- 3A $500 million sublimit for letters of credit is included within the new agreement.
- 4The company has the option to increase the total commitments under the new facility to $2.75 billion.
- 5The new credit facility is intended for general corporate purposes.
- 6The existing revolving credit agreement, dated January 4, 2011, was terminated.
- 7No outstanding borrowings were present under the old credit agreement at the time of termination, and no early termination penalties were incurred.