01—Abstract
Summary
Summary of the 8-K filed February 5, 2024. Cited figures are marked; the original filing is the authoritative source.
Occidental Petroleum Corporation (OXY) has entered into a Third Amended and Restated Credit Agreement for its revolving credit facility, effective February 2, 2024.
This amendment primarily extends the maturity date of the facility from June 30, 2025, to June 30, 2028, providing enhanced financial flexibility and a longer-term liquidity runway for the company. The agreement continues to offer interest rate options based on Adjusted Term SOFR or Alternate Base Rates, with margins tied to Occidental's senior unsecured debt ratings from Moody's, S&P, and Fitch.
02—Key points
Key Highlights
- Extended Revolving Credit Facility maturity to June 30, 2028, from June 30, 2025.
- Maintains senior unsecured debt status for loans under the facility.
- Interest rates include options for Adjusted Term SOFR or Alternate Base Rate, plus applicable margins.
- Applicable margins and facility fees are variable, ranging from 0.0 to 190.0 basis points based on Occidental's credit ratings.
- Introduced sustainability targets that can adjust interest rate margins and facility fees, subject to independent verification.
- Retains customary covenants, including a negative pledge and a Total Debt to Total Capitalization ratio not exceeding 0.65 to 1.00.
- Confirms existing lenders or their affiliates may provide ongoing financial services to Occidental.
03—Questions
Frequently Asked Questions
What is the main change in the new credit agreement?
The primary change is the extension of the maturity date for Occidental's revolving credit facility from June 30, 2025, to June 30, 2028. This provides the company with longer-term access to liquidity.
How are interest rates determined under the new agreement?
Interest rates can be based on either the Adjusted Term SOFR Rate or the Alternate Base Rate, at Occidental's option. These rates are subject to an applicable margin that varies between 100.0 to 190.0 basis points for SOFR loans and 0.0 to 90.0 basis points for Alternate Base Rate loans, depending on Occidental's credit ratings.
Does the new agreement include any sustainability-linked provisions?
Yes, the interest rate margins and facility fees may be adjusted based on Occidental's performance against specified sustainability targets. These adjustments are subject to verification by an independent external reviewer.
What are the key financial covenants in the agreement?
The agreement includes customary covenants, such as a negative pledge, and requires Occidental to maintain a ratio of Total Debt to Total Capitalization not exceeding 0.65 to 1.00 as of the end of each fiscal quarter.
04—Continue