This excerpt taken from the LMT 10-Q filed Jul 26, 2007.
The Eurodollar Margin and Facility Fee Rate for any day are the respective rates per annum set forth below in the applicable row and column corresponding to the Pricing Level and Usage that apply on such day:
For purposes of this Schedule, the following terms have the following meanings (subject to the final paragraph of this Schedule):
Level I Pricing applies on any day if on such day the Companys unsecured long-term debt is rated A+ or higher by S&P or A1 or higher by Moodys.
Level II Pricing applies on any day if on such day Level I Pricing does not apply and the Companys unsecured long-term debt is rated A or higher by S&P or A2 or higher by Moodys.
Level III Pricing applies on any day if on such day none of Level I Pricing or Level II Pricing applies and the Companys unsecured long-term debt is rated A- or higher by S&P or A3 or higher by Moodys.
Level IV Pricing applies on any day if on such day none of Level I Pricing, Level II Pricing or Level III Pricing applies and the Companys unsecured long-term debt is rated BBB+ or higher by S&P or Baal or higher by Moodys.
Level V Pricing applies on any day if no other Pricing Level applies.
Moodys means Moodys Investors Service, Inc. and its successors.
Pricing Level refers to the determination of which of Level I Pricing, Level II Pricing, Level III Pricing, Level IV Pricing or Level V Pricing applies. Level I Pricing is the lowest Pricing Level and Level V Pricing the highest.
S&P means Standard & Poors Ratings Services and its successors.
The Usage applicable to any date is the percentage equivalent of a fraction the numerator of which is the sum of the aggregate outstanding principal amount of the Loans plus the aggregate Letter of Credit Liabilities at such date and the denominator of which is the aggregate amount of the Commitments at such date. If for any reason any Loans remain outstanding following the termination of the Commitments, Usage will be deemed to be 100%.
The credit ratings to be utilized for purposes of this Pricing Schedule are those assigned to the senior unsecured long-term debt securities of the Company without third-party credit enhancement, and any rating assigned to any other debt security of the Company shall be disregarded. The credit ratings in effect on any day are those in effect at the close of business on such day. If the Company is split-rated and the ratings differential is one notch, the higher of the two ratings will apply (e.g., BBB+/Baa2 results in Level IV Pricing). If the Company is split-rated and the ratings differential is more than one notch, the average of the two ratings (or the higher of two intermediate ratings) shall be used (e.g., A-/Baa2 results in Level IV Pricing, as does A-/Baa3). If the Company receives notice from a Rating Agency of a change in the rating of its senior unsecured long-term debt, the Company will advise the Administrative Agent.