Summary
AutoZone, Inc. (AZO) filed an 8-K on September 13, 2011, to report the entry into an Amended and Restated Credit Agreement. This agreement, effective September 13, 2011, significantly modifies the company's existing revolving credit facility. The key changes include an increase in the total committed credit amount from $800 million to $1 billion, with an option to extend this to $1.25 billion under certain conditions. The maturity date has been extended to September 13, 2016. Furthermore, the agreement lowers facility fees and applicable interest rate margins on both Base Rate and Eurodollar loans, indicating potentially more favorable borrowing terms for AutoZone. This strategic move enhances AutoZone's financial flexibility and access to capital.
Key Highlights
- 1AutoZone entered into an Amended and Restated Credit Agreement on September 13, 2011.
- 2The committed credit amount has been increased from $800 million to $1 billion, with a potential to reach $1.25 billion.
- 3The maturity date of the revolving credit facility has been extended to September 13, 2016.
- 4Facility fees and applicable margins on loans have been reduced, suggesting improved borrowing costs.
- 5The agreement includes sublimits for Swingline Loans ($75 million) and letters of credit ($200 million).
- 6Key financial covenants include maintaining a ratio of Consolidated Adjusted Debt to Consolidated Adjusted EBITDAR no greater than 3.25:1.00 and a minimum ratio of Consolidated EBITDAR to Consolidated Interest Expense plus Consolidated Rents of 2.50:1.00.