Driven Brands subsidiary enters $300 million five-year revolver

By Marisa Wong

Los Angeles, May 27 – Driven Brands Holdings Inc. indirect wholly owned subsidiary Driven Holdings, LLC entered into a $300 million revolving credit facility on Thursday with JPMorgan Chase Bank, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

The revolver matures on May 27, 2026.

Borrowings will bear interest at Libor plus an applicable margin ranging from 150 basis points to 175 bps, based on the company’s net first-lien leverage ratio, subject to a 0% Libor floor.

In addition, there is a 37.5-bps commitment fee for unused commitments under the credit facility.

The borrower is also subject to a springing financial maintenance covenant, applicable only to the revolving credit commitments, which requires the borrower and its subsidiaries to not exceed a specified net first-lien leverage ratio, initially set at 2.00 to 1.00 (subject to upward adjustments, up to a net first-lien leverage ratio of 4.75 to 1.00). The springing financial maintenance covenant will only apply, beginning with the second full fiscal quarter ending after the closing, to the extent as of the last day of the relevant fiscal quarter, the aggregate amount of the outstanding loans under the revolver and issued letters of credit (excluding up to $10 million of any undrawn letters of credit and any letters of credit that have been cash collateralized or backstopped) exceeds an amount equal to 35% of the revolving facility commitments at that time.

There were no borrowings under the credit agreement as of closing.

Loan proceeds may be used for general corporate purposes.

Driven Brands is a Charlotte, N.C.-based holding company of automotive services businesses.

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