CDK Global agreed to a $400 million senior unsecured term loan facility with Bank of America, available Dec. 9.
The credit agreement will mature on the fifth anniversary of the closing date and be subject to amortization in equal quarterly installments of 1.25% of the aggregate principal amount of the term loans made on the closing date. Any unpaid principal amount will be due on the maturity date. The agreement restricts CDK Global and its subsidiaries' ability to incur more debt, merge with other companies, incur liens, enter into leaseback transactions or pay dividends.
The facility limits the company's ratio of total consolidated debt to consolidated EBITDA at 3.5 to 1. The ratio of consolidated EBITDA to consolidated interest expense must be a minimum of 3 to 1.
CDK Global also disclosed an accelerated share repurchase agreement to buy approximately 4.5 million shares of its common stock from Morgan Stanley & Co. LLC for $330 million.