CREDIT AGREEMENTS

9 Months Ended

Sep. 30, 2022

Line of Credit Facility [Abstract]

CREDIT AGREEMENTS

NOTE K— CREDIT AGREEMENTS

On July 29, 2022, we established a new $2 billion, 5-year senior unsecured revolving credit facility maturing in July 2027 (the “2022 Credit Facility”) pursuant to a Revolving Credit Agreement (the “2022 Credit Agreement”) with a syndicate of lenders. The 2022 Credit Facility replaces our prior $2 billion, 5-year senior unsecured revolving credit facility established in June 2019 (the “2019 Credit Facility”) and provides for revolving loans, swingline loans and letters of credit, with a sub-limit of $200 million for swingline loans and a sub-limit of $350 million for letters of credit, with the option to request an increase of the maximum amount of commitments up to $3 billion.

At our election, borrowings in U.S. Dollars under the 2022 Credit Agreement will bear interest either based on the secured overnight funding rate or the Base Rate (as defined in the 2022 Credit Agreement), plus an applicable margin.

We are also required to pay a quarterly unused commitment fee and letter of credit fees based on our Senior Debt Ratings.

We were in compliance with all covenants under the 2022 Credit Agreement at September 30, 2022, including the covenant requiring that we not permit our ratio of consolidated total indebtedness to total capital, each as defined in the 2022 Credit Agreement, to be greater than 0.65 to 1.00. At September 30, 2022, we had no borrowings outstanding under the 2022 Credit Agreement.

The covenants under the 2022 Credit Agreement are substantially similar to the covenants under the 2019 Credit Facility. See Note 12: Credit Arrangements in our Fiscal 2021 Form 10-K for additional information.