O'Reilly Automotive Inc. filed SEC Form 8-K: Entry into a Material Definitive Agreement, Financial Statements and Exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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| Item 1.01. | Entry into a Material Definitive Agreement. |
On August 19, 2024 (the “Closing Date”), O’Reilly Automotive, Inc. (the “Company”) issued and sold $500,000,000 aggregate principal amount of the Company’s 5.000% Senior Notes due 2034 (the “Notes”).
The terms of the Notes are governed by an Indenture, dated as of May 20, 2019 (the “Base Indenture”), by and between the Company and U.S. Bank Trust Company, National Association (f/k/a U.S. Bank National Association) (the “Trustee”), as supplemented by the Sixth Supplemental Indenture, dated as of the Closing Date (the “Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), by and between the Company and the Trustee.
The Notes mature on August 19, 2034 and bear interest at a rate of 5.000% per year. Interest on the Notes is payable on February 19 and August 19 of each year, beginning on February 19, 2025. The Notes are the Company’s general unsecured senior obligations and are equal in right of payment with all of the Company’s other existing and future unsecured and unsubordinated indebtedness, including the Company’s credit facility and the Company’s 3.550% Senior Notes due 2026, the Company’s 5.750% Senior Notes due 2026, the Company’s 3.600% Senior Notes due 2027, the Company’s 4.350% Senior Notes due 2028, the Company’s 3.900% Senior Notes due 2029, the Company’s 4.200% Senior Notes due 2030, the Company’s 1.750% Senior Notes due 2031 and the Company’s 4.700% Senior Notes due 2032 (such series of notes, collectively, the “Existing Notes”). The Notes are effectively junior to the Company’s future secured indebtedness, if any, to the extent of the value of the collateral securing such indebtedness.
The Notes are not initially guaranteed by any of the Company’s subsidiaries. However, if in the future, any of the Company’s subsidiaries incurs or guarantees obligations under the Company’s credit facility or certain other credit facility debt or capital markets debt of the Company or any future subsidiary guarantor, such subsidiary would be required to guarantee the Notes on a senior unsecured basis. The Company would be permitted to release any such future guarantee without the consent of holders of the Notes under the circumstances described in the Indenture.
Prior to May 19, 2034 (three months prior to their maturity date) (the “Par Call Date”), the Company may redeem the notes at our option, in whole or in part, at any time and from time to time, at a redemption price (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of: (1) (a) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date (assuming the notes matured on the Par Call Date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined in the Indenture) plus 20 basis points less (b) interest accrued to the date of redemption, and (2) 100% of the principal amount of the notes to be redeemed, plus, in either case, accrued and unpaid interest thereon to, but not including, the redemption date. On or after the Par Call Date, the Company may redeem the notes, in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount of the notes being redeemed plus accrued and unpaid interest thereon to, but not including, the redemption date.
Upon the occurrence of a Change of Control Triggering Event (as defined in the Indenture), unless the Company has exercised its right to redeem the Notes, each holder of Notes will have the right to require the Company to repurchase all or a portion of such holder’s Notes, for cash, at a repurchase price equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest, if any, on the amount repurchased to, but not including, the date of repurchase.
The Indenture contains covenants that limit the ability of the Company and each of its subsidiaries, as applicable to, among other things: (i) create certain liens on its assets to secure certain debt; (ii) enter into certain sale and leaseback transactions; and (iii) in the case of the Company, merge or consolidate with another company or transfer all or substantially all of the Company’s property, in each case as set forth in the Indenture. These covenants are, however, subject to a number of important limitations and exceptions.
The Indenture also contains customary event of default provisions including, among others, the following: (i) default in the payment of principal of or premium, if any, on any Note when due at its maturity; (ii) default for 30 days in the payment when due of interest on the Notes; (iii) failure to comply with the other covenants or agreements in the Indenture or the Notes and failure to cure or obtain a waiver of such default within 90 days following notice as described below; (iv) a default under any debt for money borrowed by the Company or any future subsidiary guarantor that results in acceleration of the maturity of such debt, or failure to pay any such debt within any applicable grace period after final stated maturity, in an aggregate amount greater than (a) $25.0 million, at any time that any Existing Notes remain outstanding, or (b) $100.0 million at any time that no Existing Notes remain outstanding, without such debt having been discharged or acceleration having been rescinded or annulled; and (v) certain events of bankruptcy, insolvency or reorganization with respect to the Company or any future subsidiary guarantor that is a Significant Subsidiary (as defined in the Indenture), in each case as set forth in the Indenture. In the case of an event of default, other than a default under clause (v) above, the Trustee or the holders of at least 25% in aggregate principal amount of the Notes then outstanding, by written notice to the Company (and to the Trustee if the notice is given by the holders of the Notes), may declare the principal of and accrued and unpaid interest, if any, on the Notes to be immediately due and payable. If an event of default under clause (v) above occurs, the principal of and accrued and unpaid interest, if any, on the Notes will be immediately due and payable without any act on the part of the Trustee or holders of the Notes.
The Trustee is also a lender under the Company’s credit facility, and an affiliate of the Trustee was an underwriter in the offering of the Notes.
The offering of the Notes was registered under the Securities Act of 1933, as amended, pursuant to the Company’s shelf registration statement on Form S-3 which became automatically effective upon filing with Securities and Exchange Commission on March 1, 2022 (File No. 333-263144).
The above description of the Indenture and the Notes does not purport to be complete and is qualified in its entirety by reference to the Base Indenture (which was previously filed by the Company with the SEC) and the Sixth Supplemental Indenture (including the Form of Note included therein), attached as Exhibit 4.1 and referenced as Exhibit 4.2 hereto, respectively, and incorporated herein by reference.
In addition to the specific agreements and arrangements described above, from time to time, certain of the underwriters of the Notes and/or their respective affiliates have been, and may in the future be, lenders under the Company’s credit facility and have directly and indirectly engaged, and may engage in the future, in investment and/or commercial banking transactions with the Company for which they have received, or may receive, customary compensation and expense reimbursement.
| Item 9.01 | Financial Statements and Exhibits. |
| (d) | Exhibits: |
| Exhibit No. | Description | |
| 4.1 | Sixth Supplemental Indenture, dated as of August 19, 2024, by and between the Company and the Trustee | |
| 4.2 | Form of Note (included in Exhibit 4.1) | |
| 5.1 | Opinion of Shook, Hardy & Bacon L.L.P. | |
| 5.2 | Opinion of Skadden, Arps, Slate, Meagher & Flom LLP | |
| 23.1 | Consent of Shook, Hardy & Bacon L.L.P. (included in Exhibit 5.1) | |
| 23.2 | Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in Exhibit 5.2) | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date:August 19, 2024
| O’Reilly Automotive, Inc. | ||
| By: | /s/ Jeremy Fletcher | |
| Jeremy Fletcher | ||
| Executive Vice President and Chief Financial Officer | ||
| (principal financial and accounting officer) | ||