Business Context and Reporting Period
Company: Emerson Electric Co.
Filing Type: Form 8-K (Current Report)
Date of Report: February 17, 2023
Event: Entry into a new material definitive agreement regarding a revolving credit facility.
Key Financial Metrics
This filing does not report revenue, profit, cash flow, margins, or liquidity metrics. It focuses exclusively on debt capacity and credit facility terms.
- New Facility Size: $3.5 billion
- Facility Type: Five-year revolving credit facility
- Expiration Date: February 2028
- Outstanding Borrowings: $0 (No loans or letters of credit currently outstanding)
- Security Status: Unsecured
Material Changes Versus Prior Period
On February 17, 2023, the Company terminated a similar $3.5 billion five-year revolving credit facility dated May 23, 2018. This prior facility was immediately replaced by the new 2023 Facility. There is no change in the total credit capacity available to the Company, only a renewal of the agreement terms and expiration date.
Guidance, Outlook, and Management Commentary
Management Commentary: The Company states it has not incurred any borrowings under the new or prior facilities and has no current intention to do so. The facility is intended to support general corporate purposes, including commercial paper borrowings.
Terms and Conditions:
- The facility allows for various interest rate alternatives at the Company's option.
- Loans and letters of credit may be denominated in U.S. dollars or certain other currencies.
- The Company guarantees the obligations of eligible subsidiaries named as borrowers.
- Facility fees are payable on the aggregate amounts available.
Risks and Contingencies: The filing notes that lenders and their affiliates engage in commercial and investment banking transactions with the Company. The summary is qualified by reference to the full credit agreement (Exhibit 10.1).
Important Facts for Investor Verification
- Verify the specific interest rate alternatives and facility fee percentages in the attached Credit Agreement (Exhibit 10.1).
- Confirm the list of eligible subsidiaries that may be designated as borrowers under the new facility.
- Review the customary covenants and events of default included in the 2023 Facility to assess potential restrictions on future operations.
- Note that while the facility is unsecured, the Company has provided unconditional guarantees for subsidiary obligations.