Business Context and Reporting Period
Assurant, Inc. filed this Form 8-K on December 18, 2009, to disclose the creation of a direct financial obligation. The company is incorporated in Delaware and maintains its principal executive offices in New York, New York.
Key Financial Metrics and Debt Structure
The filing details a new three-year unsecured revolving credit agreement with an aggregate capacity of $350 million. This facility replaces a prior five-year $500 million revolving credit facility that was scheduled to expire in April 2010. Key terms include:
- Facility Size: $350 million (expandable to $525 million subject to conditions).
- Maturity: December 2012.
- Agents: JPMorgan Chase Bank, N.A. (administrative agent) and Bank of America, N.A. (syndication agent).
- Usage: Proceeds may fund the commercial paper program or general corporate purposes.
The filing text does not provide specific values for revenue, profit, cash flow, margins, or current liquidity positions beyond the description of the credit facility.
Material Changes Versus Prior Period
The primary material change is the termination of the previous $500 million credit facility upon the effectiveness of the new agreement. Consequently, the company's available revolving credit capacity has decreased from $500 million to $350 million, though the new agreement includes an accordion feature allowing an increase to $525 million.
Outlook, Risks, and Covenants
The Credit Agreement contains customary affirmative and negative covenants. The filing notes that an event of default would cause all unpaid principal, accrued interest, and other obligations to become immediately due and payable. No specific guidance, management commentary on future performance, or unusual items were disclosed in this report.
Investor Verification Checklist
- Verify the utilization rate of the new $350 million facility versus the terminated $500 million facility.
- Review the specific affirmative and negative covenants in the Credit Agreement to assess compliance risks.
- Confirm the conditions required to exercise the option to increase the facility to $525 million.
- Assess the impact of the reduced credit capacity on the company's commercial paper program.