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Note 7 - Floor Plan Notes Payable and Lines of Credit | 12 Months Ended
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Dec. 31, 2024
Notes to Financial Statements |
Debt Disclosure [Text Block] |
7. | FLOOR PLAN NOTES PAYABLE AND LINE OF CREDIT:
Floor Plan Notes Payable Floor plan notes are financing agreements to facilitate the Company’s purchase of new and used commercial vehicle inventory. These notes are collateralized by the inventory purchased, and accounts receivable arising from the sale thereof. The Company’s BMO Floor Plan Credit Agreement with BMO Bank, N.A. provides for a loan commitment of up to $675.0million. The interest rate under the BMO Floor Plan Credit Agreement is the one-month SOFR, plus 1.20%. The effective interest rate applicable to the BMO Floor Plan Credit Agreement was approximately 5.69% as of December 31, 2024. The Company utilizes its excess cash on hand to pay down its outstanding borrowings under its BMO Floor Plan Credit Agreement, and the resulting interest earned is recognized as an offset to the Company’s gross interest expense under the BMO Floor Plan Credit Agreement. The Company’s PFC Floor Plan Credit Agreement with PFC provides for a loan commitment of up to $800.0 million. The interest rate under the PFC Floor Plan Credit Agreement is the prime rate, minus 2.10%. The effective interest rate applicable to the PFC Floor Plan Credit Agreement was approximately 5.4% as of December 31, 2024. The Company utilizes its excess cash on hand to pay down its outstanding borrowings under the PFC Floor Plan Credit Agreement, and the resulting interest earned is recognized as an offset to the Company’s gross interest expense under the PFC Floor Plan Credit Agreement. The Company’s RTC Canada Floor Plan Credit Agreement provides for a loan commitment of up to $116.7 million CAD of revolving credit loans to finance RTC Canada’s purchase of new and used vehicle inventory. Loans to purchase used vehicle inventory are limited to twenty percent (20%) of the credit limit available at such time. RTC Canada may borrow, repay and reborrow loans from time to time until the maturity date, provided, however, that the outstanding principal amount on any date shall not exceed the credit limits set forth above with respect to new and used vehicles. Advances under the RTC Canada Floor Plan Credit Agreement bear interest per annum, payable on the first business day of each calendar month, payable monthly, at CORRA, plus 1.27%. The Company finances all of the purchase price of its new commercial vehicle inventory and the loan value of its used commercial vehicle inventory under the PFC Floor Plan Credit Agreement, the BMO Floor Plan Credit Agreement and the RTC Canada Floor Plan Agreement, under which BMO Bank, N.A., PFC and BMO pay the manufacturer directly with respect to new commercial vehicles. Amounts borrowed under the agreements are due when the related commercial vehicle inventory (collateral) is sold. The BMO Floor Plan Credit Agreement expires December 31, 2029, although BMO Bank, N.A. has the right to terminate the BMO Floor Plan Credit Agreement at any time upon 360 days written notice and the Company may terminate at any time, subject to specified limited exceptions. The PFC Floor Plan Credit Agreement expires December 16, 2029, although either party has the right to terminate the PFC Floor Plan Credit Agreement at any time upon 360 days written notice. On December 31, 2024, we had approximately $492.7 million outstanding under the PFC Floor Plan Credit Agreement. On December 31, 2024, the Company had approximately $389.3 million outstanding under its BMO Floor Plan Credit Agreement. The Company’s RTC Canada Floor Plan Credit Agreement expires September 14, 2026. On December 31, 2024, the Company had approximately $78.2 million CAD outstanding under the RTC Canada Floor Plan Agreement. The Company’s weighted average interest rate for floor plan notes payable was 4.4% for the year ended December 31, 2024, and 3.3% for the year ended December 31, 2023, which is net of interest related to prepayments of new and used inventory loans. Assets pledged as collateral were as follows (in thousands):
|  | December 31, |
|  | 2024 |  |  | 2023 |
Inventories, new and used vehicles at cost based on specific identification, net of allowance |  | $ | 1,427,196 |  |  | $ | 1,423,521 |
Vehicle sale-related accounts receivable |  |  | 197,186 |  |  |  | 119,575 |
Total |  | $ | 1,624,382 |  |  | $ | 1,543,096 |
Floor plan notes payable related to vehicles |  | $ | 1,081,199 |  |  | $ | 1,139,744 |
Line of Credit The Company has a line of credit that provides for a maximum borrowing of $25.0 million. There were no advances outstanding under this secured line of credit as of December 31, 2024, however, $18.8 million was pledged to secure various letters of credit related to self-insurance products, leaving $6.2 million available for future borrowings as of December 31, 2024.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481544/470-10-50-6 Reference 2: 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