8-KMaterial AgreementsExhibits & Filings

O REILLY AUTOMOTIVE INC 8-K Report, Material Agreement (May 17, 2018)

Filed May 17, 2018For Securities:ORLY

Summary

O'Reilly Automotive, Inc. (ORLY) filed an 8-K report on May 17, 2018, to announce the issuance and sale of $500 million in aggregate principal amount of 4.350% Senior Notes due 2028. These notes are general unsecured senior obligations of the company, ranking equally with existing unsecured and unsubordinated debt, but are effectively junior to any future secured indebtedness. The issuance was made under an existing shelf registration statement. The notes mature on June 1, 2028, with interest payable semi-annually. The company has the option to redeem the notes under specific conditions, including a "Par Call" provision after March 1, 2028. Importantly, the issuance includes provisions for a repurchase offer at 101% of principal if a "Change of Control Triggering Event" occurs, protecting bondholders in such scenarios. The accompanying indenture includes covenants that limit the company's and its subsidiaries' ability to incur certain liens, engage in sale-leaseback transactions, or merge/consolidate, subject to standard exceptions. The filing also details customary event of default provisions.

Key Highlights

  • 1O'Reilly Automotive issued $500 million of 4.350% Senior Notes due 2028 on May 17, 2018.
  • 2The notes are unsecured senior obligations of the company.
  • 3The maturity date for the new notes is June 1, 2028.
  • 4Interest on the notes will be paid at 4.350% annually, semi-annually.
  • 5The company has the option to redeem the notes, with specific pricing before and after March 1, 2028.
  • 6A "Change of Control Triggering Event" allows noteholders to require repurchase at 101% of principal plus accrued interest.
  • 7The indenture includes covenants restricting liens, sale-leaseback transactions, and mergers/consolidations.

Frequently Asked Questions

This 8-K filing is to report the entry into a material definitive agreement, specifically the issuance and sale of $500 million of 4.350% Senior Notes due 2028 by O'Reilly Automotive, Inc.

The notes mature on June 1, 2028, bear interest at 4.350% per year, payable semi-annually on June 1 and December 1. They are general unsecured senior obligations and are redeemable at the company's option under specified conditions. A "Change of Control Triggering Event" gives holders the right to have their notes repurchased at 101% of principal.

The notes are not initially guaranteed by any subsidiaries. However, if any subsidiary incurs or guarantees obligations under the company's credit facility or certain other debt in the future, that subsidiary would be required to guarantee these notes on a senior unsecured basis.

The indenture contains covenants that limit the ability of O'Reilly and its subsidiaries to create certain liens on assets, enter into specific sale and leaseback transactions, and for the company, to merge or consolidate, or transfer substantially all of its property. These restrictions are subject to defined limitations and exceptions.