Notes Payable - Floor Plan

12 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Notes Payable - Floor Plan

Notes Payable — Floor Plan

The Company maintains an ongoing wholesale marine products inventory financing program with a syndicate of banks. The program is administered by Wells Fargo Commercial Distribution Finance, LLC (“Wells Fargo”). On February 14, 2023, the Company and certain of its subsidiaries entered into the Fourth Amendment to the Seventh Amended and Restated Inventory Financing Agreement (as amended, the “ Seventh Inventory Financing Facility") with Wells Fargo and the other financial institutions party thereto to increase the maximum borrowing amount available under the Seventh Inventory Financing Facility to $550.0 million. The Seventh Inventory Financing Facility was set to expire on December 1, 2023. On November 14, 2023 the Company entered into the Eighth Amended and Restated Inventory Financing Agreement to, among other things, increase the maximum borrowing amount available to $650.0 million and extend the term. See Note 20 for additional information regarding the new agreement. The outstanding balance of the facility was $489.0 million and $267.1 million, as of September 30, 2023 and 2022, respectively.

Interest on new boats and for rental units is calculated using the Adjusted 30-Day Average SOFR (as defined in the Inventory Financing Facility) (“SOFR”) plus an applicable margin of 2.75% to 5.00% depending on the age of the inventory. Interest on pre-owned boats in calculated at the new boat rate plus 0.25%. Wells Fargo will finance 100.0% of the vendor invoice price for new boats, engines, and trailers. As of September 30, 2023 the interest rate on the Seventh Inventory Financing Facility ranged from 8.18% to 10.43% for new inventory and 8.43% to 10.68% for pre-owned inventory. As of September 30, 2022 the interest rate on the Seventh Inventory Financing Facility ranged from 5.33% to 7.58% for new inventory and 5.58% to 7.83% for pre-owned inventory. Borrowing capacity available at September 30, 2023 and September 30, 2022 was $61.0 million and $232.9 million, respectively.

The Seventh Inventory Financing Facility has certain financial and non-financial covenants as specified in the agreement. The financial covenants include requirements to comply with a maximum funded debt to EBITDA ratio (as defined in the Seventh Inventory Financing Facility). In addition, certain non-financial covenants could restrict the Company’s ability to sell assets (excluding inventory in the normal course of business), engage in certain mergers and acquisitions, incur additional debt and pay cash dividends or distributions, among others. The Company was in compliance with all covenants at September 30, 2023.

The collateral for the Seventh Inventory Financing Facility consists primarily of our inventory that is financed through the Seventh Inventory Financing Facility and related assets, including accounts receivable, bank accounts and proceeds of the foregoing, and excludes the collateral that underlies the term note payable to Truist Bank.