Form 8-K CREDIT ACCEPTANCE CORP For: Dec 20
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E-mailUNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 20, 2017
CREDIT ACCEPTANCE CORPORATION
(Exact name of registrant as specified in its charter)
Michigan | 000-20202 | 38-1999511 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||
25505 West Twelve Mile Road | ||||
Southfield, Michigan | 48034-8339 | |||
(Address of principal executive offices) | (Zip Code) | |||
Registrant’s telephone number, including area code: 248-353-2700
Not Applicable | ||
(Former name or former address, if changed since last report) | ||
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company [ ]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. *
Item 1.01 Entry into a Material Definitive Agreement.
The information set forth below under Item 2.03 is hereby incorporated by reference into this Item 1.01.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
On December 20, 2017 Credit Acceptance Corporation (referred to as the “Company”, “Credit Acceptance”, “we”, “our”, or “us”) executed Amendment No. 1 to the Sixth Amended and Restated Loan and Security Agreement (“Warehouse Amendment”) dated as of December 20, 2017, among the Company, CAC Warehouse Funding Corporation II and Wells Fargo Bank, National Association. The Warehouse Amendment extends the date on which our $400.0 million revolving secured warehouse facility will cease to revolve from June 23, 2019 to December 20, 2020. The interest rate on borrowings under the facility has been decreased from LIBOR plus 225 basis points to LIBOR plus 175 basis points. There were no other material changes to the terms of the facility.
As of December 20, 2017, we did not have a balance outstanding under the facility. The terms and conditions of this transaction are set forth in the agreement attached hereto as Exhibit 4.100 to this Form 8-K and incorporated herein by reference.
On December 20, 2017, we issued a press release announcing the execution of the Warehouse Amendment. The press release is attached as Exhibit 99.1 to this Form 8-K and incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
CREDIT ACCEPTANCE CORPORATION | |||
Date: December 21, 2017 | By: | /s/ Douglas W. Busk | |
Douglas W. Busk | |||
Senior Vice President and Treasurer | |||
AMENDMENT NO. 1 TO LOAN AND SECURITY AGREEMENT
This AMENDMENT NO. 1 TO THE SIXTH AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Amendment”) is made as of December 20, 2017, by and among CAC WAREHOUSE FUNDING CORPORATION II, as the borrower (the “Borrower”), CREDIT ACCEPTANCE CORPORATION, as the servicer (in such capacity, the “Servicer”) and as the custodian (in such capacity, the “Custodian”), WELLS FARGO BANK, NATIONAL ASSOCIATION, as a lender (the “WF Lender”), the LENDERS FROM TIME TO TIME PARTY THERETO, as lenders (together with WF Lender, the “Lenders”), WELLS FARGO BANK, NATIONAL ASSOCIATION, as the deal agent (in such capacity, together with its successors and assigns, the “Deal Agent”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, as the backup servicer (in such capacity, together with its successors and assigns, the “Backup Servicer”) and as the collateral agent (in such capacity, together with its successors and assigns, the “Collateral Agent”). Capitalized terms used and not otherwise defined herein shall have the meanings given to such terms in the Agreement (as defined below).
R E C I T A L S
WHEREAS, the Borrower, the Servicer, the Lenders, the Deal Agent, the Backup Servicer and the Collateral Agent entered into that certain Sixth Amended and Restated Loan and Security Agreement, dated as of June 23, 2016 (as amended and restated from time to time, the “Agreement”); and
WHEREAS, the parties hereto desire to amend the Agreement pursuant to Section 14.1 thereof in certain respects as provided herein;
NOW, THEREFORE, based upon the above Recitals, the mutual premises and agreements contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:
SECTION 1.Amendments.
(a) Section 1.1 of the Agreement is hereby amended by deleting the definition of “Borrowing Base” in its entirety and replacing it with the following:
“Borrowing Base: On any date of determination, (a) the product of (i) the Aggregate Outstanding Eligible Loan Net Balance and (ii) the Net Advance Rate, minus (b) the Overconcentration Loan Amount.”
(b) Section 1.1 of the Agreement is hereby amended by deleting “June 23, 2019 from the definition of “Commitment Termination Date” and replacing it with “December 20, 2020”.
SECTION 2. Agreement in Full Force and Effect as Amended.
Except as specifically amended hereby, all provisions of the Agreement shall remain in full force and effect. After this Amendment becomes effective, all references to the Agreement, the “Loan and Security Agreement,” “hereof,” “herein,” or words of similar effect referring to the Agreement shall be deemed to mean the Agreement as amended hereby. This Amendment shall not constitute a novation of the Agreement, but shall constitute an amendment thereof. This Amendment shall not be deemed to expressly or impliedly waive, amend or supplement any provision of the Agreement other than as expressly set forth herein.
SECTION 3. Representations.
Each of the Borrower and the Servicer represent and warrant as of the date of this Amendment as follows:
(a) it is duly incorporated or organized, validly existing and in good standing under the laws of its jurisdiction of incorporation or organization;
(b) the execution, delivery and performance by it of this Amendment are within its powers, have been duly authorized, and do not contravene (A) its charter, by-laws, or other organizational documents, or (B) any Applicable Law;
(c) no consent, license, permit, approval or authorization of, or registration, filing or declaration with any governmental authority, is required in connection with the execution, delivery, performance, validity or enforceability of this Amendment by or against it;
(d) this Amendment has been duly executed and delivered by it;
(e) this Amendment constitutes its legal, valid and binding obligation enforceable against it in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity;
(f) each of the representations and warranties set forth in Sections 4.1, 4.2 and 4.3 of the Agreement made by it is true and correct; and
(g) no Amortization Event or Termination Event has occurred and is continuing and no event or condition exists that, with the giving of notice and/or passage of time, would constitute an Amortization Event or a Termination Event.
SECTION 4. Conditions to Effectiveness.
This Amendment shall become effective on the date on which each party hereto shall have delivered an executed signature page hereto to the Deal Agent.
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SECTION 5. Miscellaneous.
(a) This Amendment may be executed in any number of counterparts (including by facsimile), and by the different parties hereto on the same or separate counterparts, each of which shall be deemed to be an original instrument but all of which together shall constitute one and the same agreement.
(b) The descriptive headings of the various sections of this Amendment are inserted for convenience of reference only and shall not be deemed to affect the meaning or construction of any of the provisions hereof.
(c) This Amendment may not be amended or otherwise modified except as provided in the Agreement.
(d) The failure or unenforceability of any provision hereof shall not affect the other provisions of this Amendment.
(e) Whenever the context and construction so require, all words used in the singular number herein shall be deemed to have been used in the plural, and vice versa, and the masculine gender shall include the feminine and neuter and the neuter shall include the masculine and feminine.
(f) This Amendment represents the final agreement between the parties only with respect to the subject matter expressly covered hereby and may not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements between the parties. There are no unwritten oral agreements between the parties.
(g) THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties have caused this Amendment to be executed by their respective officers thereunto duly authorized, as of the date first above written.
THE BORROWER: | CAC WAREHOUSE FUNDING CORPORATION II |
By: | /s/ Douglas W. Busk Name: Douglas W. Busk Title: Treasurer |
THE SERVICER AND CUSTODIAN: | CREDIT ACCEPTANCE CORPORATION |
By: | /s/ Douglas W. Busk Name: Douglas W. Busk Title: Senior Vice President & Treasurer |
THE DEAL AGENT: | WELLS FARGO BANK, NATIONAL ASSOCIATION, as Deal Agent |
By: | /s/ Mary Leigh Phillips Name: Mary Leigh Phillips Title: Director |
THE BACKUP SERVICER | WELLS FARGO BANK, NATIONAL ASSOCIATION |
By: | /s/ Julie Tanner Fischer Name: Julie Tanner Fischer Title: Vice President |
THE COLLATERAL AGENT: | WELLS FARGO BANK, NATIONAL ASSOCIATION |
By: | /s/ Julie Tanner Fischer Name: Julie Tanner Fischer Title: Vice President |
THE LENDER: | WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender |
By: | /s/ James B. Brinkley II Name: James B. Brinkley II Title: Managing Director |
Silver Triangle Building
25505 West Twelve Mile Road
Southfield, MI 48034-8339
(248) 353-2700
creditacceptance.com
NEWS RELEASE
FOR IMMEDIATE RELEASE
Date: December 20, 2017
Investor Relations: Douglas W. Busk
Senior Vice President and Treasurer
(248) 353-2700 Ext. 4432
NASDAQ Symbol: CACC
CREDIT ACCEPTANCE ANNOUNCES
EXTENSION OF REVOLVING SECURED WAREHOUSE FACILITY
Southfield, Michigan – December 20, 2017 – Credit Acceptance Corporation (NASDAQ: CACC) (referred to as the “Company”, “Credit Acceptance”, “we”, “our”, or “us”) announced today that we extended the date on which our $400.0 million revolving secured warehouse facility will cease to revolve from June 23, 2019 to December 20, 2020. The interest rate on borrowings under the facility has been decreased from LIBOR plus 225 basis points to LIBOR plus 175 basis points. There were no other material changes to the terms of the facility.
As of December 20, 2017, we did not have a balance outstanding under the facility.
Description of Credit Acceptance Corporation
Since 1972, Credit Acceptance has offered financing programs that enable automobile dealers to sell vehicles to consumers, regardless of their credit history. Our financing programs are offered through a nationwide network of automobile dealers who benefit from sales of vehicles to consumers who otherwise could not obtain financing; from repeat and referral sales generated by these same customers; and from sales to customers responding to advertisements for our financing programs, but who actually end up qualifying for traditional financing.
Without our financing programs, consumers are often unable to purchase vehicles or they purchase unreliable ones. Further, as we report to the three national credit reporting agencies, an important ancillary benefit of our programs is that we provide consumers with an opportunity to improve their lives by improving their credit score and move on to more traditional sources of financing. Credit Acceptance is publicly traded on the NASDAQ under the symbol CACC. For more information, visit creditacceptance.com.
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