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Get filing alertsGentherm enters $550M 5-year revolving credit facility with leverage-based pricing
Filed July 2, 2026 · Period ending June 29, 2026 · ~1 min read
Key Changes
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Secured $550M revolving credit facility replacing prior 2022 agreement, with $50M swing line and $30M letter of credit sublimits, maturing in five years.
Item 1.01 — Entry into a Material Definitive Agreement verify on EDGAR → -
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Interest rates range from SOFR/EURIBOR plus 1.125%-2.000% or base rate plus 0.125%-1.000%, with margins tied to consolidated net leverage ratio.
Item 1.01 — Entry into a Material Definitive Agreement verify on EDGAR → -
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Facility secured by substantially all US borrower and guarantor assets, with guarantees from wholly-owned domestic subsidiaries and certain foreign entities.
Item 1.01 — Entry into a Material Definitive Agreement verify on EDGAR → -
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Agreement requires minimum interest coverage ratio and maximum net leverage ratio compliance, with quarterly commitment fees of 0.150%-0.250% on unused capacity.
Item 1.01 — Entry into a Material Definitive Agreement verify on EDGAR →
Summary
Gentherm replaced its 2022 credit agreement with a new $550 million five-year revolving facility on June 29, 2026. The facility provides enhanced liquidity with sublimits for swing line loans ($50M) and letters of credit ($30M), giving the company flexible access to capital for operations, acquisitions, or other corporate purposes.
The pricing structure incentivizes balance sheet discipline: interest margins decline as Gentherm's leverage ratio improves, ranging from 1.125%-2.000% above benchmark rates. The facility is secured by substantially all US assets and guaranteed by domestic and certain foreign subsidiaries, which is standard for investment-grade industrial credits but does limit the company's ability to pledge those assets elsewhere.
Financial covenants require maintaining minimum interest coverage and maximum leverage ratios, though specific thresholds were not disclosed. For shareholders, this is a routine refinancing that extends Gentherm's credit maturity profile and maintains ample liquidity. The leverage-based pricing gives management a clear incentive to reduce debt, and the five-year term provides stability through 2031. No immediate concerns arise from the structure or terms disclosed.
Section-by-Section Diff
Event · Item 1.01 — Entry into a Material Definitive Agreement
Gentherm entered a $550M 5-year revolving credit facility with interest rates tied to SOFR/EURIBOR plus 1.125%-2.000% margin based on leverage.
Added in current filing · verify on EDGAR →
The obligations under the Credit Agreement are unconditionally guaranteed by certain of Gentherm’s wholly-owned domestic subsidiaries, subject to customary exceptions, and are secured by substantially all of the assets of the US Borrowers and such guarantors, subject to customary exceptions. The German Borrowers and certain other foreign subsidiaries guarantee the obligations of the non-U.S. loan parties under the Credit Agreement.
The credit facility is secured by substantially all assets of US borrowers and guarantors, with guarantees from wholly-owned domestic subsidiaries. German borrowers and other foreign subsidiaries provide guarantees for non-US obligations. This comprehensive collateral package protects lenders but limits Gentherm's flexibility to pledge assets elsewhere.
Added in current filing · verify on EDGAR →
The Credit Agreement also requires that Gentherm maintain a minimum consolidated interest coverage ratio and a maximum consolidated net leverage ratio.
Gentherm must maintain minimum interest coverage and maximum leverage ratios under the agreement. These financial covenants restrict the company's ability to take on additional debt or make certain distributions if financial performance deteriorates. Specific ratio thresholds are not disclosed in this filing.
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Figures/quotes linked to EDGAR · Narrative written by AI · Jul 8, 2026 · How we verify