Summary
This 8-K filing reports on AutoZone, Inc.'s significant refinancing activities as of July 9, 2009. The company entered into a new $800 million Revolving Credit Agreement, which can be increased to $1 billion, replacing its previous $1 billion in credit facilities. This new agreement has a termination date of July 15, 2012, with a potential extension to July 15, 2013. The document details the terms of the new facility, including interest rate calculations based on Eurodollar and base rates plus an "Applicable Margin" tied to AutoZone's credit default swap spread and long-term debt ratings. It also outlines sublimits for swingline loans and letters of credit, as well as covenants related to debt-to-EBITDAR and EBITDAR-to-interest and rent expense ratios.
Key Highlights
- 1AutoZone entered into a new $800 million Revolving Credit Agreement, which can be expanded to $1 billion.
- 2The new agreement replaces prior credit facilities totaling $1 billion, indicating a refinancing and potential adjustment in credit capacity.
- 3The termination date for the new agreement is July 15, 2012, with an option for AutoZone to request an extension to July 15, 2013.
- 4Interest rates will be determined by fluctuating base or Eurodollar rates plus an 'Applicable Margin' linked to AutoZone's credit default swap spread and debt ratings.
- 5The agreement includes specific sublimits: $50 million for swingline loans and $200 million for letters of credit.
- 6Key financial covenants require AutoZone to maintain a Consolidated Adjusted Debt to Consolidated Adjusted EBITDAR ratio not exceeding 3.10:1.00 and a Consolidated EBITDAR to Consolidated Interest Expense plus Consolidated Rents ratio of at least 2.50:1.00.