Tyson Foods 2013 Annual Report Download - page 30

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30
On February 11, 2013, S&P upgraded the credit rating of the 2016 Notes from "BBB-" to "BBB." This upgrade did not impact the
interest rate on the 2016 Notes.
A one-notch downgrade by Moody's would increase the interest rates on the 2016 Notes by 0.25%. A two-notch downgrade from
S&P would increase the interest rates on the 2016 Notes by 0.25%.
Revolving Credit Facility
S&P’s corporate credit rating for Tyson Foods, Inc. is "BBB." Moody’s senior, unsecured, subsidiary guaranteed long-term debt
rating for Tyson Foods, Inc. is "Baa3." Fitch Ratings', a wholly owned subsidiary of Fimalac, S.A. (Fitch), issuer default rating for
Tyson Foods, Inc. is "BBB." The below table outlines the fees paid on the unused portion of the facility (Facility Fee Rate) and
letter of credit fees (Undrawn Letter of Credit Fee and Borrowing Spread) depending on the rating levels of Tyson Foods, Inc. from
S&P, Moody's and Fitch.
Ratings Level (S&P/Moody's/Fitch) Facility Fee
Rate
Undrawn Letter of
Credit Fee and
Borrowing Spread
BBB+/Baa1/BBB+ or above 0.150% 1.125%
BBB/Baa2/BBB (current level) 0.175% 1.375%
BBB-/Baa3/BBB- 0.225% 1.625%
BB+/Ba1/BB+ 0.275% 1.875%
BB/Ba2/BB or lower or unrated 0.325% 2.125%
In the event the rating levels are split, the applicable fees and spread will be based upon the rating level in effect for two of the
rating agencies, or, if all three rating agencies have different rating levels, the applicable fees and spread will be based upon the
rating level that is between the rating levels of the other two rating agencies.
Debt Covenants
Our revolving credit facility contains affirmative and negative covenants that, among other things, may limit or restrict our ability
to: create liens and encumbrances; incur debt; merge, dissolve, liquidate or consolidate; dispose of or transfer assets; change the
nature of our business; engage in certain transactions with affiliates; and enter into sale/leaseback or hedging transactions, in each
case, subject to certain qualifications and exceptions. In addition, we are required to maintain minimum interest expense coverage
and maximum debt to capitalization ratios.
Our 2022 Notes also contain affirmative and negative covenants that, among other things, may limit or restrict our ability to: create
liens; engage in certain sale/leaseback transactions; and engage in certain consolidations, mergers and sales of assets.
We were in compliance with all debt covenants at September 28, 2013.
OFF-BALANCE SHEET ARRANGEMENTS
We do not have any off-balance sheet arrangements material to our financial position or results of operations. The off-balance sheet
arrangements we have are guarantees of debt of outside third parties, including a lease and grower loans, and residual value guarantees
covering certain operating leases for various types of equipment. See Part II, Item 8, Notes to Consolidated Financial Statements, Note
20: Commitments and Contingencies for further discussion.