Lithia Motors lifts loan agreement to $1.85 billion, extends to 2021

By Wendy Van Sickle

Columbus, Ohio, Dec. 22 – Lithia Motors, Inc. expanded and extended its loan agreement with U.S. Bank NA as administrative agent on Dec. 18, according to an 8-K filed with the Securities and Exchange Commission.

The amended loan agreement lifts capacity to $1.85 billion from $1.7 billion. Lithia may request up to $250 million of additional commitments.

The maturity date has been extended through January 2021 from October 2019.

The amended agreement allocates $180 million to used vehicle inventory floorplan financing, $170 million to revolving loans for acquisitions and other general corporate purposes and the remaining $1.5 billion for new vehicle inventory floorplan financing.

The company has the option to reallocate the commitments, provided that the used vehicle inventory floorplan financing commitment does not exceed $250 million and the revolving loan commitment does not exceed $300 million.

The margin over one-month Libor varies based on the type of debt: 125 basis points for new vehicle floorplan financing, 150 bps for used vehicle floorplan financing and a variable rate on revolving financing ranging from 125 bps to 250 bps, depending on Lithia’s leverage ratio.

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

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