Business Context and Reporting Period
Company: Emerson Electric Co.
Filing Type: Form 8-K (Current Report)
Date of Report: April 30, 2014
Event: Entry into a material definitive agreement regarding a new credit facility.
Key Financial Metrics
This filing does not report revenue, profit, cash flow, margins, or existing debt levels. It specifically details a new liquidity arrangement:
- New Facility Size: $3.5 billion revolving credit facility.
- Term: Five years (expires April 2019).
- Outstanding Borrowings: $0 (No loans or letters of credit currently drawn).
- Security Status: Unsecured.
- Primary Agents: JPMorgan Chase Bank, N.A. (Agent) and Citibank, N.A. (Syndication Agent).
Material Changes Versus Prior Period
The Company replaced a previous $2.75 billion four-year revolving credit facility dated December 16, 2010, with the new $3.5 billion five-year facility. This represents an increase in available credit capacity of $750 million and an extension of the maturity term by one year.
Guidance, Outlook, and Management Commentary
Purpose: The facility supports general corporate purposes, including backing commercial paper borrowings.
Management Intent: The Company states it has not incurred borrowings under this or prior similar facilities and has no intention to do so.
Terms: The facility allows for various interest rate alternatives and loans/letters of credit denominated in U.S. dollars or certain other currencies. The Company is obligated to pay facility fees on the aggregate amounts available.
Important Facts for Investor Verification
- Verify the specific facility fee rates and interest rate alternatives in the attached Credit Agreement (Exhibit 10.1).
- Confirm the customary covenants and events of default included in the agreement.
- Note that while the facility is unsecured, it is intended to back commercial paper, which may impact short-term liquidity reporting in future filings.
- Review the relationship disclosures regarding lenders engaging in commercial or investment banking transactions with the Company.