Summary
Rockwell Automation, Inc. (ROK) filed an 8-K on March 19, 2009, reporting the execution of two new credit agreements on March 16, 2009. These agreements replace a prior $600 million credit facility. The new facility consists of a $267.5 million unsecured 364-day revolving credit agreement and a $267.5 million three-year unsecured revolving credit agreement, totaling $535 million in available credit. The proceeds are designated for general corporate purposes, including serving as a backstop for commercial paper. These credit agreements are significant for investors as they provide continued access to liquidity during a challenging economic period. The company has secured credit lines that are crucial for operational flexibility and to manage its short-term financing needs. The covenants within these agreements, particularly the debt-to-capital ratio limit of 60 percent, are important for monitoring the company's financial health and risk profile.
Key Highlights
- 1Rockwell Automation entered into two new unsecured revolving credit agreements totaling $535 million on March 16, 2009.
- 2A $267.5 million 364-day agreement includes a term-out option for an additional year.
- 3A $267.5 million three-year agreement provides longer-term revolving credit.
- 4Proceeds from these agreements are for general corporate purposes, including commercial paper backstop, ensuring liquidity.
- 5The new credit facilities replace a previous $600 million credit agreement, which was terminated without material early termination penalties.
- 6The agreements contain covenants, including a restriction on debt-to-capital ratio exceeding 60 percent.
- 7Key lenders include major financial institutions such as JPMorgan Chase Bank, N.A., Bank of America, N.A., Citibank, N.A., The Bank of New York Mellon, and Wells Fargo Bank, National Association.