Summary
The Progressive Corporation (PGR) filed an 8-K on March 24, 2014, to report the renewal of its unsecured, discretionary line of credit with PNC Bank. This new line of credit totals $100 million and is set to expire on March 25, 2015. The terms and conditions are largely consistent with the previous line of credit that expired on March 24, 2014. This renewal of the credit facility provides Progressive with continued access to $100 million in potential funding. While the line is discretionary and subject to PNC's approval for each advance, it serves as a financial backstop. The interest rate is variable, tied to the Prime Rate or Federal Funds Open Rate plus a spread. The renewal indicates the company's ongoing strategy to maintain financial flexibility.
Key Highlights
- 1Progressive Corporation renewed its $100 million unsecured, discretionary line of credit with PNC Bank.
- 2The renewed line of credit is effective as of March 24, 2014, and expires on March 25, 2015.
- 3The terms of the new line of credit are substantially the same as the prior facility.
- 4Advances under the line of credit will bear interest at a variable rate tied to the Prime Rate or Federal Funds Open Rate plus 50 basis points.
- 5Each advance is repayable within 30 days or by the expiration date of March 25, 2015.
- 6Prepayments are allowed without penalty.
- 7All advances are subject to PNC Bank's discretion.