Consumer Portfolio Services Inc. filed SEC Form 8-K: Entry into a Material Definitive Agreement, Creation of a Direct Financial Obligation
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Item 1.01. Entry into a Material Definitive Agreement.
The information contained in Item 2.03 of this report is hereby incorporated by reference into this Item 1.01. The registrant disclaims any implication that the agreements relating to the transactions described in this report are other than agreements entered into in the ordinary course of its business.
Warehouse Credit Facility Amended
On November 1, 2024, Consumer Portfolio Services, Inc. ("CPS" or the "Company") and its wholly-owned subsidiary Page Eight Funding LLC (the “Borrower”) amended a revolving credit agreement (the "Credit Agreement") and related agreements, all of which have been in place since May 2012, and most recently renewed on July 11, 2024. The agent to act on behalf of the several lenders (“Lenders”) under the Credit Agreement is Citibank, N.A.. Loans under the amended Credit Agreement are to be secured by automobile receivables that CPS now holds or may purchase in the future from dealers, which receivables CPS would then sell or contribute to the Borrower.
Under the Credit Agreement, and subject to its terms and conditions, the Lenders have increased the capacity from $200 million and agreed to lend from time to time prior to the funding termination date up to a maximum of $225 million to be outstanding at any time. The amendments also add a subordinate third party lender that increases the advance percentage secured by the pledged receivables. The advance percentage is dependent on characteristics of the pledged receivables, the terms of future term securitizations executed by CPS, and on performance of receivables purchased by CPS within the preceding three years, as to which there can be no assurance. The funding termination date is July 15, 2026 or earlier upon the occurrence of defined funding termination events. The amounts outstanding could become due at an earlier date, if any of certain defined events of default were to occur.
Loans under the Credit Agreement bear interest at a floating rate set as a margin above the secured overnight financing rate. In connection with amendment of the Credit Agreement, CPS has paid a closing fee of approximately $250,000.
Affiliates of Citibank, N.A. have also performed investment banking and advisory services for CPS from time to time, for which they have received customary fees and expenses.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information provided in response to item 1.01 is incorporated herein by reference.
Warehouse Credit Facility
CPS first incurred indebtedness under the revolving credit agreement in May 14, 2012. CPS intends to incur indebtedness from time to time as it purchases motor vehicle receivables from dealers. CPS does not undertake to provide updates regarding the amount of indebtedness outstanding from time to time, and no inference should be drawn that such indebtedness has not changed.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| CONSUMER PORTFOLIO SERVICES, INC. | |
| Dated: November 7, 2024 | By: /s/ Denesh Bharwani |
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Denesh Bharwani Executive Vice President and Chief Financial Officer Signing on behalf of the registrant |
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