Summary
Philip Morris International Inc. (PMI) filed an 8-K on February 3, 2020, reporting on a material definitive agreement related to its credit facility. The company entered into an amendment and extension agreement for its $2.0 billion revolving credit facility, originally established in 2013. This amendment effectively extends the expiration date of the credit facility from February 4, 2020, to February 2, 2021. Importantly, the agreement also removes a key financial covenant that previously required PMI to maintain a minimum ratio of consolidated EBITDA to consolidated interest expense of 3.5 to 1.0. This change could provide PMI with greater financial flexibility.
Key Highlights
- 1PMI amended and extended its $2.0 billion revolving credit facility.
- 2The expiration date of the credit facility has been extended by one year, to February 2, 2021.
- 3A significant financial covenant requiring a minimum EBITDA to interest expense ratio of 3.5 to 1.0 has been eliminated.
- 4The amendment is effective February 4, 2020.
- 5Citibank Europe PLC, UK Branch continues to serve as the administrative agent.
- 6No other terms of the existing credit agreement were significantly altered, other than as specified in the amendment.
- 7This filing was made on February 3, 2020, concerning an event on January 31, 2020.