eBay Inc. Secures $3.0 Billion Revolving Credit Facility

Strategic Insights -

eBay Inc., a leading e-commerce platform, has secured a $3.0 billion revolving credit facility with a group of lenders, including JPMorgan Chase Bank, N.A., Citibank, N.A., and Deutsche Bank Securities Inc. The facility, which was established on November 22, 2011, provides for an unsecured five-year revolving credit facility with a letter of credit sub-facility and a swingline sub-facility.

Key Takeaways:

  • The revolving credit facility has a total commitment of $3.0 billion, with a $300 million letter of credit sub-facility and a $100 million swingline sub-facility.
  • The facility provides for up to $1.0 billion in additional commitments, subject to the agreement of the applicable lenders.
  • The company may designate one or more of its subsidiaries as additional borrowers under the Credit Agreement, subject to certain conditions.
  • The facility will terminate on November 22, 2016, unless terminated earlier or the maturity date is extended upon the request of the company.
  • The negative covenants include restrictions regarding the incurrence of liens, subject to certain exceptions.
  • The financial covenant requires the company to meet a quarterly financial test with respect to a minimum consolidated interest coverage ratio.

Statistics:

  • $3.0 billion: Total commitment of the revolving credit facility.
  • $300 million: Letter of credit sub-facility.
  • $100 million: Swingline sub-facility.
  • $1.0 billion: Potential additional commitments.
  • $2.0 billion: Available borrowing capacity for other purposes permitted by the Credit Agreement.

Sources:

  • Form 8-K (Current report) filed by eBay Inc. with the Securities and Exchange Commission on November 28, 2011 (http://www.sec.gov/currentreports).
  • eBay Inc. Securities and Exchange Commission filing.