Sonic Automotive gets $1.27 billion of amended, restated facilities

By Angela McDaniels

Tacoma, Wash., Dec. 5 – Sonic Automotive, Inc. entered into amended and restated credit agreements on Wednesday that provide for a $250 million revolving credit facility, an $800 million new vehicle revolving floorplan facility and a $215 million used vehicle revolving floorplan facility, according to an 8-K filing with the Securities and Exchange Commission.

Each facility is due Nov. 30, 2021.

The revolver has a $50 million accordion feature.

The credit agreement for the floorplan facilities has a $250 million accordion feature.

The interest rate for the revolver is Libor plus a margin that ranges from 150 basis points to 275 bps based on the company’s leverage. The quarterly commitment fee ranges from 25 bps to 50 bps.

The interest rate for the new vehicle floorplan facility is Libor plus 125 bps, and it is Libor plus 150 bps for the used vehicle floorplan facility. The quarterly commitment fee is 15 bps for both.

The revolver is available for acquisitions, capital expenditures, working capital and general corporate purposes.

The new vehicle floorplan facility provides availability to finance new vehicle inventory.

The used vehicle floorplan facility provides availability to finance the acquisition of used vehicle inventory and other working capital, capital expenditures and general corporate purposes.

Each facility is subject to a borrowing base.

Bank of America, NA is the administrative agent and swingline lender for each facility.

For the revolver, the lenders are Bank of America, Mercedes-Benz Financial Services USA LLC, BMW Financial Services NA, LLC, Toyota Motor Credit Corp., JPMorgan Chase Bank, NA, Comerica Bank, VW Credit, Inc., U.S. Bank, NA, Wells Fargo Bank, NA, World Omni Financial Corp., American Honda Finance Corp., Capital One, NA, MassMutual Asset Finance LLC, PNC Bank, NA and TD Bank, NA.

For the vehicle floorplan facilities, the lenders are Bank of America, JPMorgan, U.S. Bank, Wells Fargo Bank, Mercedes-Benz Financial Services, Comerica Bank, Capital One, Bank of the West, VW Credit and Toyota Motor Credit.

Financial covenants require a consolidated liquidity ratio of not less than 1.05 times, a consolidated fixed charge coverage ratio of not less than 1.2 times and a consolidated total lease-adjusted leverage ratio of not more than 5.75 times.

Sonic is a Charlotte, N.C.-based automotive retailer.

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