Penske Automotive Group Inc. filed SEC Form 8-K: Entry into a Material Definitive Agreement, Financial Statements and Exhibits
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Retail-Auto Dealers and Gas Stations
Consumer Discretionary
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
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Item 1.01 Entry into a Material Definitive Agreement.
On December 2, 2024, we entered into the Eleventh Amendment (the “Amendment”) to our U.S. credit agreement with Mercedes-Benz Financial Services USA LLC, Toyota Motor Credit Corporation and Daimler Truck Financial Services USA LLC (as amended, the “U.S. Credit Agreement”) principally to increase the facility borrowing capacity from $1.2 billion to $1.5 billion.
As amended, the U.S. Credit Agreement provides for up to $1.5 billion in revolving loans for working capital, acquisitions, capital expenditures, investments and other general corporate purposes, and provides up to an additional $75.0 million of letters of credit. The U.S. Credit Agreement provides for a maximum of $400.0 million of borrowings for foreign acquisitions and expires on September 30, 2027. The interest rate on revolving loans is based on an adjusted Secured Overnight Financing Rate (SOFR) plus 1.50%, with uncollateralized borrowings in excess of a defined borrowing base bearing interest at adjusted SOFR plus 2.00%.
The U.S. Credit Agreement is fully and unconditionally guaranteed on a joint and several basis by substantially all of our U.S. subsidiaries and contains a number of significant operating covenants that, among other things, restrict our ability to dispose of assets, incur additional indebtedness, repay certain other indebtedness, pay dividends, create liens on assets, make investments or acquisitions, and engage in mergers or consolidations. We are also required to comply with specified financial and other tests and ratios, each as defined in the U.S. Credit Agreement, including a ratio of current assets to current liabilities, a fixed charge coverage ratio, a ratio of debt to stockholders’ equity, and a ratio of debt to earnings before interest, taxes, depreciation, and amortization (“EBITDA”). A breach of these requirements would give rise to certain remedies under the U.S. Credit Agreement, the most severe of which is the termination of the agreement and acceleration of the amounts owed.
The U.S. Credit Agreement also contains typical events of default, including change of control, non-payment of obligations, and cross-defaults to our other material indebtedness. Substantially all of our U.S. assets are subject to security interests granted to the lenders under the U.S. Credit Agreement. We purchase motor vehicles and parts from affiliates of Mercedes-Benz Financial Services USA LLC, Daimler Truck Financial Services USA LLC and Toyota Motor Credit Corporation for sale at certain of our dealerships. The lenders also provide us and certain of our dealerships with mortgage, “floor-plan”, and consumer financing.
The foregoing description of the Amendment is qualified in its entirety by references to the Amendment, a copy of which is filed as an exhibit and incorporated by reference herein.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit Index
| Exhibit No. | Description | ||||||||||
4.1 | |||||||||||
| 104 | Cover Page Interactive Data File (formatted as inline XBRL). | ||||||||||
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.
| Penske Automotive Group, Inc. | |||||||||||
| December 3, 2024 | By: | /s/ Shane M. Spradlin | |||||||||
| Name: Shane M. Spradlin | |||||||||||
| Title: Executive Vice President | |||||||||||