Summary
Motorola Solutions, Inc. (MSI) has filed an 8-K report detailing the execution of two material definitive agreements: a 364-day credit agreement and a three-year credit agreement. Both agreements are delayed-draw term loan facilities totaling $750.0 million each, for a combined total of $1.5 billion in potential financing. These facilities are specifically arranged to fund a portion of the consideration for the previously announced acquisition of Silvus Technologies Holdings Inc. ("Silvus"), along with refinancing Silvus's existing debt and associated fees and expenses. The funding is contingent on the substantially concurrent closing of the Silvus acquisition. The 364-day facility matures 364 days from funding, with an option to extend a portion of the loan for another year, and carries interest based on a base rate or Term SOFR plus an applicable margin. A ticking fee of 12.5 basis points and an extension fee of 5 basis points (if the loan is extended) will apply. The three-year facility matures three years from funding, also with interest based on base rate or Term SOFR plus an applicable margin, and a ticking fee ranging from 9 to 25 basis points. Both agreements include a financial covenant requiring compliance with a leverage ratio and customary restrictive covenants and events of default.
Key Highlights
- 1Motorola Solutions secured $1.5 billion in new credit facilities to finance the acquisition of Silvus Technologies.
- 2The financing comprises a $750 million 364-day term loan and a $750 million three-year term loan.
- 3The credit agreements are contingent upon the closing of the Silvus acquisition.
- 4Proceeds will be used for acquisition consideration, refinancing Silvus's debt, and related expenses.
- 5The 364-day loan has a maturity of 364 days, with an option to extend a portion to two years.
- 6The three-year loan has a maturity of three years from funding.
- 7Both agreements include leverage ratio financial covenants and customary restrictive covenants.