Lithia Motors restates agreement for $1.7 billion facility due 2019

By Marisa Wong

Madison, Wis., Oct. 3 – Lithia Motors, Inc. entered into an amended and restated loan agreement on Oct. 1 for a total financing commitment of $1.7 billion, according to an 8-K filing with the Securities and Exchange Commission.

The prior loan agreement, dated April 17, 2012, provided for a total financing commitment of $1 billion and would have expired in December 2018.

The restated credit facilities, which can be expanded to $1.85 billion, expire in October 2019.

Under the amended loan agreement, the initial allocation of the financing commitment is for the following:

• Up to $150 million in used vehicle inventory floor plan financing, which could increase to a maximum of $250 million, an increase from a prior maximum of $200 million;

• A maximum of $300 million in revolving financing for the company’s general corporate purposes, including acquisitions and working capital, an increase from a prior maximum of $200 million; and

• An aggregate of up to $1.25 billion in new vehicle inventory floor plan financing, an increase from a prior commitment of $700 million.

The amended loan agreement permits reallocations of the financing commitments provided that the used vehicle inventory floor plan commitment does not exceed $250 million, the revolving financing commitment does not exceed $300 million and the sum of those commitments plus the new vehicle inventory floor plan financing commitment does not exceed the total aggregate financing commitment.

Interest on the credit facility varies based on the type of debt. Specifically, the rate is one-month Libor plus 125 basis points for new vehicle floor plan financing, one-month Libor plus 150 bps for used vehicle floor plan financing and a variable rate on the revolving financing ranging from one-month Libor plus 125 bps to one-month Libor plus 250 bps, depending on the company’s leverage ratio.

U.S. Bank NA is the agent for the lenders; JPMorgan Chase Bank, NA and Toyota Motor Credit Corp. are co-syndication agents; U.S. Bank NA and J.P. Morgan Securities LLC are co-lead arrangers and joint bookrunners; and American Honda Finance Corp., TD Bank, NA and Mercedes-Benz Financial Services USA LLC are co-documentation agents.

U.S. Bank NA, JPMorgan Chase Bank, NA, Toyota Motor Credit Corp., American Honda Finance Corp., Mercedes-Benz Financial Services USA LLC, TD Bank, NA, BMW Financial Services NA, LLC, Bank of America, NA, Capital One, NA, Bank of the West, KeyBank NA, Ally Bank, Santander Bank, NA, VW Credit, Inc., Nissan Motor Acceptance Corp. and Hyundai Capital America are the lenders.

Lithia Motors is a Medford, Ore.-based automotive retailer.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.