Las Vegas Sands Corp. (NYSE:LVS) has established a new $1.5 billion revolving credit facility with a consortium of banks, with The Bank of Nova Scotia acting as the administrative agent. This credit line, confirmed on Wednesday, includes a $150 million sub-facility for issuing letters of credit and is slated for general corporate and working capital needs.
The credit agreement, effective until April 3, 2029, offers Las Vegas Sands the option to choose interest rates pegged to the secured overnight financing rate plus a margin between 1.125% and 1.550%, or an alternate base rate with a margin of 0.125% to 0.550%, contingent on the company's credit rating. Additionally, the company is obliged to pay a quarterly commitment fee on the undrawn portion of the credit, ranging from 0.125% to 0.250%, also based on its credit rating.
The agreement imposes certain conditions, including a cap on the consolidated net leverage ratio for Las Vegas Sands and its restricted subsidiaries at 4.00 to 1.00 at the end of each fiscal quarter. It also restricts the company's ability to incur additional liens, debt, and restricts mergers, asset sales, and investments in non-restricted subsidiaries.
Should Las Vegas Sands fail to comply with the terms, it would face default consequences, which could lead to the termination of the credit line and acceleration of debt repayment. This facility aims to provide the company with financial flexibility for the forthcoming five years.
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