What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-02-20 compared with 2025-02-26 · 279 added, 211 removed, 1433 unchanged (25% of the section changed)

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generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 26, 2025 expressed an adverse opinion thereon.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 20, 2026 expressed an unqualified opinion thereon.

Basis for Opinion

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The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Goodwill and Manufacturer Franchise Rights Interim Quantitative Impairment Assessment

Description of the Matter At December 31, 2024, the Company’s goodwill and manufacturer franchise rights had an aggregate carrying value of approximately $2,044.7 million and $1,911.7 million, respectively, as disclosed in Note 10 of the consolidated financial statements.

Manufacturer franchise rights and goodwill are assessed for impairment annually as of October 1st, or more often if events or circumstances indicate that impairment may have occurred.

If the fair value of a franchise right or a goodwill reporting unit is less than its carrying amount, an impairment loss is recognized in an amount equal to the difference.

We identified as a critical audit matter the assessment of the Company’s projected cash flows utilized in the interim quantitative impairment tests over certain manufacturer franchise rights and the goodwill of the Arizona and Utah reporting units.

In connection with its interim quantitative impairment assessment performed during the second quarter 2024, the Company recorded impairment charges of $134.1 million related to manufacturer franchise rights, as disclosed in Note 10 of the consolidated financial statements, and there was no impairment charge recorded related to goodwill as the carrying values of the Arizona and Utah reporting units did not exceed their fair value.

Auditing the Company's fair value estimates used in its impairment assessment was complex due to the estimation uncertainty required to determine the fair value of the franchise rights and the fair value of the reporting units subject to the interim quantitative impairment assessment.

The Company's model for estimating the fair value of these assets was sensitive to changes in significant market participant assumptions related to the cash flows directly attributable to the franchise rights and goodwill reporting units, including the revenue growth rates, which are forward-looking and affected by expectations about economic, industry and company-specific factors.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company’s controls over the goodwill and manufacturer franchise rights fair value estimates used in conjunction with its interim quantitative impairment assessments.

This included testing controls over management’s review of the model, significant assumptions, other inputs and the completeness and accuracy of the data used in the measurements.

Procedures performed to test the fair value of the Company's goodwill and manufacturer franchise rights as part of the interim quantitative impairment assessments included, among others, evaluating the Company's use of the discounted cash flows method, testing of the revenue growth assumption used in the valuation model used to develop the projected financial information, involving our valuation specialists to assist in the testing of the appropriateness of the model used, and testing the completeness and accuracy of the underlying data.

We compared the assumptions to current industry, market and economic trends, as well as to the Company's historical results.

In addition, we assessed the accuracy of the Company’s projections by comparing them to actual operating results and evaluated the Company’s intent and ability to carry out a particular course of action by evaluating the Company’s past history of carrying out its stated intentions.

We also performed a sensitivity analysis of the revenue growth assumption to evaluate the potential change in the fair value of the goodwill and manufacturer franchise rights resulting from changes in underlying assumptions.

Valuation of Manufacturer Franchise Rights

Description of the Matter At December 31, 2025, the manufacturer franchise rights balance was $2.1 billion.

As disclosed in Note 10 of the consolidated financial statements, the manufacturer franchise rights are assessed for impairment annually as of October 1st, or more often if events or circumstances indicate that impairment may have occurred.

If the fair value of a franchise right is less than its carrying amount, an impairment loss is recognized in an amount equal to the difference.

Auditing the Company’s calculation of the fair value for certain manufacturer franchise rights based on our risk assessment procedures was complex and required significant judgment.

In particular, the determination of the fair value of certain manufacturer franchise rights described above using the discounted cash flows method required management to develop certain significant assumptions, including future EBITDA margins and weighted average cost of capital, which are forward looking and affected by expectations about economic conditions, industry factors and dealer-specific factors.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company’s controls over the certain manufacturer franchise rights fair value estimates described above, including controls over the significant assumptions described above.

To test the fair value of certain manufacturer franchise rights described above, we tested the significant assumptions described above.

We compared those significant assumptions to current industry, market and economic trends, as well as to the Company's historical results.

In addition, we assessed the accuracy of the Company’s projections by comparing them to actual operating results.

We also performed a sensitivity analysis of the significant assumptions described above to evaluate the potential change in the fair value of certain manufacturer franchise rights resulting from changes in underlying assumptions.

We also involved our valuation specialists to assist in evaluating the valuation methodologies and certain significant assumptions used in the valuation models.

/s/ Ernst & Young LLP

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We have audited Asbury Automotive Group, Inc.’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, because of the effect of the material weakness described below on the achievement of the objectives of the control criteria, Asbury Automotive Group, Inc.

(the Company) has not maintained effective internal control over financial reporting as of December 31, 2024, based on the COSO criteria.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

The following material weakness has been identified and included in management’s assessment.

Management identified a material weakness in internal control over financial reporting in Jim Koons Automotive Companies business (“Koons”).

The design of information technology general controls for an information technology (“IT”) application that is used across all significant processes within the Koons business was not effective, specifically pertaining to insufficient control activities at a third-party system administrator.

As a result, automated and business process controls that are dependent on the completeness and accuracy of information derived from the affected IT system were also ineffective because they could have been adversely impacted.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2024 and 2023, the related consolidated statements of income, comprehensive income, shareholders' equity and cash flows for each of the three years in the period ended December 31, 2024, and the related notes.

This material weakness was considered in determining the nature, timing and extent of audit tests applied in our audit of the 2024 consolidated financial statements, and this report does not affect our report dated February 26, 2025, which expressed an unqualified opinion thereon.

In our opinion, Asbury Automotive Group, Inc.

(the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on the COSO criteria.

As indicated in the accompanying Management’s Report on Internal Control Over Financial Reporting, management’s assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of The Herb Chambers Companies, which is included in the 2025 consolidated financial statements of the Company and constituted $1.89 billion of total assets as of December 31, 2025 and $1.16 billion of revenues for the year then ended.

Our audit of internal control over financial reporting of the Company also did not include an evaluation of the internal control over financial reporting of The Herb Chambers Companies.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income, shareholders' equity and cash flows for each of the three years in the period ended December 31, 2025, and the related notes and our report dated February 20, 2026 expressed an unqualified opinion thereon.

Basis for Opinion

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Asset impairments 141.0 149.5 117.2

Other operating income, net — — ( 4.4 )

INCOME FROM OPERATIONS 860.6 835.6 953.5

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Gain on dealership divestitures, net ( 80.2 ) ( 8.6 ) ( 13.5 )

Total other expenses (income), net 260.3 152.2 ( 46.5 )

Total other expenses, net 198.4 260.3 152.2

INCOME BEFORE INCOME TAXES 662.2 575.3 801.3

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Basic 19.5 19.9 20.9

Restricted stock — — 0.1

Performance share units 0.1 0.1 0.1

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Net income $ 492.0 $ 430.3 $ 602.5

Other comprehensive (loss) income:

Other comprehensive income (loss) - net of tax:

Change in fair value of cash flow swaps ( 29.6 ) ( 3.2 ) ( 22.6 )

Unrealized (losses) gains on available-for-sale debt securities ( 2.5 ) 5.2 ( 4.0 )

Income tax benefit (expense) associated with other comprehensive income items 1.4 4.0 ( 24.3 )

Income tax benefit associated with cash flow swaps 7.1 0.9 5.1

Unrealized gains (losses) on available-for-sale debt securities 8.1 ( 2.5 ) 5.2

Income tax (expense) benefit associated with available-for-sale debt securities ( 1.9 ) 0.6 ( 1.1 )

Comprehensive income $ 475.7 $ 426.1 $ 589.1

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Net income — — — 602.5 — — — 602.5

Change in fair value of cash flow swaps, net of reclassification adjustment and $ 25.1 million tax expense

Change in fair value of cash flow swaps, net of reclassification adjustment and $ 5.1 million tax benefit

— — — — — — ( 17.5 ) ( 17.5 )

Unrealized loss on changes in fair value of debt securities, net of $ 0.8 million tax benefit

Unrealized gain on changes in fair value of debt securities, net of $ 1.1 million tax expense

— — — — — — 4.1 4.1

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— — — — — — ( 2.3 ) ( 2.3 )

Unrealized gain on changes in fair value of debt securities, net of $ 1.1 million tax expense

Unrealized loss on changes in fair value of debt securities, net of $ 0.6 million tax benefit

— — — — — — ( 1.9 ) ( 1.9 )

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— — — — — — ( 22.5 ) ( 22.5 )

Unrealized gain on changes in fair value of debt securities, net of $ 0.6 million tax benefit

Unrealized gain on changes in fair value of debt securities, net of $ 1.9 million tax expense

— — — — — — 6.2 6.2

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Asset impairments 141.0 149.5 117.2

Unrealized (gain) loss on investments ( 0.6 ) ( 2.1 ) 14.1

Loaner vehicle amortization 56.8 47.2 34.8

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Purchases of debt securities—available-for-sale ( 189.4 ) ( 165.0 ) ( 195.2 )

Purchases of equity securities — — ( 41.4 )

Proceeds from the sale of debt securities—available-for-sale 132.8 149.8 60.3

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Proceeds from the sale of assets — 6.5 16.3

Net cash (used in) provided by investing activities ( 137.2 ) ( 1,678.4 ) 464.7

Net cash (used in) investing activities ( 1,457.2 ) ( 137.2 ) ( 1,678.4 )

CASH FLOW FROM FINANCING ACTIVITIES:

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Floor plan repayments—divestitures ( 90.7 ) ( 34.1 ) —

Proceeds from borrowings 546.5 — —

Repayments of borrowings ( 234.1 ) ( 71.4 ) ( 126.0 )

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Repayments of revolving credit facility ( 2,032.7 ) ( 1,213.5 ) ( 329.0 )

Proceeds from issuance of common stock — — 1.4

Payment of debt issuance costs ( 5.7 ) — ( 1.2 )

Purchase of treasury stock ( 99.9 ) ( 183.0 ) ( 267.7 )

For the Year Ended December 31,

2025 2024 2023

Purchase of treasury stock ( 183.0 ) ( 267.7 ) ( 287.4 )

Repurchases of common stock, including amounts associated with net share settlements of employee share-based awards ( 12.8 ) ( 10.2 ) ( 11.4 )

Net cash (used in) provided by financing activities ( 510.3 ) 1,175.8 ( 1,104.3 )

Net increase (decrease) in cash and cash equivalents 23.7 ( 189.6 ) 56.4

Net cash provided by (used in) financing activities 653.1 ( 510.3 ) 1,175.8

Net (decrease) increase in cash and cash equivalents

( 29.0 ) 23.7 ( 189.6 )

CASH AND CASH EQUIVALENTS, beginning of period 69.4 45.7 235.3

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DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Asbury Automotive Group, Inc., a Delaware corporation organized in 2002, is one of the largest automotive retailers in the United States.

Asbury Automotive Group, Inc., a Delaware corporation organized in 2002 (the "Company"), is one of the largest automotive retailers in the United States.

Our store operations are conducted by our subsidiaries.

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and finance and insurance ("F&I") products, including arranging vehicle financing through third parties and aftermarket products, such as extended service contracts, guaranteed asset protection ("GAP") debt cancellation and prepaid maintenance.

The finance and insurance products are provided by Total Care Auto, Powered by Landcar ("TCA") and independent third parties.

The finance and insurance products are provided by Total Care Auto, Powered by Asbury ("TCA") and independent third parties.

The Company manages its operations in two reportable segments:

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Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"), and reflect the consolidated accounts of Asbury Automotive Group, Inc.

(the "Company") and our wholly owned subsidiaries.

All intercompany transactions have been eliminated in consolidation.

If necessary, reclassifications of amounts previously reported have been made to the accompanying consolidated financial statements in order to conform to current presentation.

Amounts presented have been calculated using non-rounded amounts for all periods presented and therefore certain amounts may not compute due to rounding.

Amounts presented have been calculated using non-rounded amounts for all periods presented and therefore certain amounts may not compute.

Use of Estimates

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Premiums and discounts on debt securities classified as short-term investments are amortized or accreted using the effective interest method over the period from the purchase date to the expected maturity or call date of the related security and are reported in net income.

Investments consist of available-for-sale debt securities and other investments.

Investments consist of available-for-sale debt securities.

These securities are classified as non-current investments as they are not intended to fund current operations or have stated call dates or maturity dates beyond the next 12 months.

We sold all equity securities during the year ended December 31, 2023.

The Company only holds debt securities as of December 31, 2024 and 2023.

Debt securities classified as non-current investments are designated as available-for-sale as management intends to hold these securities for indefinite periods of time or may sell the securities in response to changes in interest rates, prepayments, or other similar factors.

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Upon the completion of purchase accounting, the fair value of our manufacturer franchise rights are determined as of the acquisition date, by discounting the projected cash flows specific to each franchise.

Included in this analysis are market participant assumptions related to the cash flows directly attributable to the franchise rights, including year-over-year and terminal growth rates, working capital requirements, weighted average cost of capital, future gross margins, and future selling, general and administrative expenses.

Goodwill and Franchise Rights

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Goodwill associated with TCA is tested for impairment at the operating segment level which is the same as the reporting unit for this business.

Our only significant identifiable intangible assets, other than goodwill, are our rights under franchise agreements with manufacturers, which are recorded at an individual franchise level.

The fair value of our manufacturer franchise rights are determined as of the acquisition date, by discounting the projected cash flows specific to each franchise.

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that goodwill becomes impaired due to decreases in the fair value of our automotive retail business or manufacturer franchise rights become impaired due to decreases in the fair value of our individual franchises.

Our identifiable intangible assets, other than goodwill, are our rights under franchise agreements with manufacturers, which are recorded at an individual franchise level, and the value of business acquired ("VOBA") which is recorded at the TCA segment level.

We recorded VOBA of $ 5.6 million in connection with the acquisition of TCA in 2021.

VOBA reflects the estimated fair value of the expected future profits in unearned premium for in-force service contracts acquired in the LHM acquisition.

VOBA is reflected in other long-term assets within the consolidated balance sheets and is amortized over 5 years, which represents the approximate term of the underlying contracts.

Debt Issuance Costs

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Payment is typically received when control of the parts and accessories transfers to the customer or within 30 days of such time.

When the Company performs shipping and handling activities after the transfer of control to the customer (e.g., when control transfers prior to delivery), they are considered as fulfillment activities, and accordingly, the costs are accrued when the related revenue is recognized.

When the Company performs shipping and handling activities after the transfer of control to the customer (e.g., when control transfers

prior to delivery), they are considered as fulfillment activities, and accordingly, the costs are accrued when the related revenue is recognized.

Vehicle repair and maintenance services

The Company provides vehicle repair and maintenance services to its customers pursuant to the terms and conditions included within the customer contract ("repair order").

Payment for services are typically received upon completion of the services or within 30 days following the completion of the services.

Payments for services are typically received upon completion of the services or within 30 days following the completion of the services.

Satisfaction of this performance obligation creates an asset with no alternative use for which an enforceable right to payment for performance to date exists within our contractual agreements.

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We earn and recognize premium revenue related to the TCA segment over the period of the related service contract.

Accordingly, we record deferred revenue and ratably recognize revenue over the service contract period.

Accordingly, we record deferred revenue and we ratably recognize revenue over the service contract period.

Unpaid Losses and Loss Adjustment Expense Reserve

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Those estimates are subject to the effects of trends in loss severity and frequency.

Although considerable variability is inherent in such estimates, management believes the reserves for losses and loss adjustment expenses are adequate.

Although considerable variability is inherent in such estimates, management believes the reserves for losses and loss

adjustment expenses are adequate.

The estimates are continually reviewed and adjusted as necessary as experience develops or new information becomes known;

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Diluted earnings per common share is computed by dividing net income by the weighted-average common shares and common share equivalents outstanding during the period.

The Company excluded 4,718 , 1,349 , and 2,086 restricted share units and 159 , 1,898 , and 60 performance share units issued under the Asbury Automotive Group, Inc.

2019 Equity and Incentive Compensation Plan from its computation of diluted earnings per share for the years ended December 31, 2025, 2024 and 2023, respectively, because they were anti-dilutive.

For all periods presented, there were no adjustments to the numerator necessary to compute diluted earnings per share.

We expense costs of advertising as incurred and production costs when the advertising initially takes place, net of certain advertising credits and other discounts received from certain automobile manufacturers.

Advertising expense totaled $ 61.8 million , $ 47.5 million and $ 50.1 million for the years ended December 31, 2024, 2023 and 2022, which was net of earned advertising credits of $ 40.7 million , $ 36.5 million and $ 35.5 million, respectively, and is included in selling, general and administrative expense in the accompanying consolidated statements of income.

Advertising expense totaled $ 68.9 million, $ 61.8 million and $ 47.5 million for the years ended December 31, 2025, 2024 and 2023, which was net of earned

advertising credits of $ 41.1 million, $ 40.7 million and $ 36.5 million, respectively, and is included in selling, general and administrative expense in the accompanying consolidated statements of income.

We use the liability method to account for income taxes.

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As of December 31, 2025, we had total debt of $ 3.59 billion, which excludes floor plan notes payable, debt issuance costs, and the debt premium on the 4.5 % Senior Notes (the " 4.5 % Notes") and 4.75 % Senior Notes (the " 4.75 % Notes") due 2028 and 2030, respectively.

In addition, we and our subsidiaries have the ability to

obtain additional debt from time to time to finance acquisitions, real property purchases, capital expenditures, share repurchases or for other purposes, although such borrowings are subject to the restrictions contained in the fourth amended and restated senior secured credit agreement with Bank of America, N.A.

("Bank of America"), as administrative agent, and the other lenders party thereto (the "2023 Senior Credit Facility"), the indentures governing our 4.5 % Notes, 4.625 % Notes, 4.75 % Notes and 5.0 % Notes (the "Indentures"), and our other debt instruments.

In addition, we and our subsidiaries have the ability to obtain additional debt from time to time to finance acquisitions, real property purchases, capital expenditures, share repurchases or for other purposes, although such borrowings are subject to the restrictions contained in the fourth amended and restated senior secured credit agreement with Bank of America, N.A.

("Bank of America"), as administrative agent, and the other lenders party thereto (the "2023 Senior Credit Facility"), the indentures governing our 4.5 % Notes, 4.625 % Notes, 4.75 % Notes

and 5.0 % Notes (the "Indentures"), and our other debt instruments.

We will have substantial debt service obligations, consisting of required cash payments of principal and interest, for the foreseeable future.

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(Chrysler, Dodge, Jeep, Ram and Fiat) 8 %

Mercedes-Benz USA, LLC ( Mercedes-Benz and Sprinter )

General Motors Company (Chevrolet, Buick and GMC) 7 %

Hyundai Motor North America ( Hyundai and Genesis )

Mercedes-Benz USA, LLC (Mercedes-Benz, Smart and Sprinter) 7 %

Hyundai Motor America (Hyundai) 6 %

No other manufacturers individually accounted for more than 5 % of our total new vehicle revenue for the year ended December 31, 2025.

Recent Accounting Pronouncements

The Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2024-03, Disaggregation – Income Statement Expenses , in November 2024, which requires additional disclosure of the nature of expenses included in the income statement.

The Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2025-06, Intangibles – Goodwill and Other – Internal-Use Software , in September 2025, which is intended to modernize the internal-use software guidance to adapt to the agile (i.e.

iterative and flexible) basis predominantly employed to develop software today.

The new standard amends the recognition threshold for capitalizing internal-use software costs and clarifies the presentation and disclosure requirements associated with internal-use software.

The guidance is effective for interim and annual periods beginning after December 15, 2027 and may be applied prospectively, retrospectively or on a modified prospective basis.

We are evaluating the impact of this new guidance on our consolidated financial statements.

In July 2025, the FASB issued ASU 2025-05, Measurement of Credit Losses for Accounts Receivable and Contract Assets.

The standard provides a practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract assets.

The practical expedient assumes that conditions as of the balance sheet date do not change for the remaining life of the accounts receivable and contract assets when forecasting estimated credit losses.

An entity is required to disclose whether it has applied the practical expedient.

The guidance is effective for interim and annual periods beginning after

December 15, 2025 and should be applied prospectively.

Early adoption is permitted.

We are evaluating the impact of this new guidance on our consolidated financial statements.

The FASB issued ASU 2024-03, Disaggregation – Income Statement Expenses , in November 2024, which requires additional disclosure of the nature of expenses included in the income statement.

The new standard requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses.

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In December 2023, the FASB issued final guidance in ASU 2023-09, Improvements to Income Tax Disclosures , which primarily expands the disclosures related to the effective tax rate reconciliation and income taxes paid.

The guidance is effective for annual periods beginning after December 15, 2024 and should be applied prospectively with the option of retrospective

We do not expect the adoption of this accounting standard to have a significant impact on our consolidated financial statements, but it will require certain additional disclosures.

I n November 2023, the FASB issued ASU 2023-07, Segment Reporting:

Improvements to Reportable Segment Disclosures ("ASU 2023-07"), which enhances the disclosures primarily around segment expenses.

In addition, the amendments expand the scope of quarterly financial reporting by requiring disclosure of both existing annual segment reporting disclosures and the expanded disclosures outlined in ASU 2023-07.

The guidance should be applied retrospectively and is effective for fiscal years beginning after December 15, 2023, and for interim periods beginning after December 15, 2024.

We adopted this new guidance for the year ended December 31, 2024.

See Note 20, "Segment Information".

The guidance is effective for annual periods beginning after December 15, 2024 and should be applied prospectively with the option of retrospective application.

We adopted this new guidance for the year ended December 31, 2025 following the retrospective application.

See Note 16, "Income Taxes".

REVENUE RECOGNITION

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Vehicle repair and maintenance services 1,995.3 1,838.5 1,585.3

Parts and services 2,354.7 2,081.5 2,074.2

Parts and service 2,506.8 2,354.7 2,081.5

Finance and insurance, net 770.6 766.0 676.2

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ACQUISITIONS AND DIVESTITURES

Herb Chambers Acquisition

On July 21, 2025, we completed the acquisition of The Herb Chambers Companies (collectively, the "Businesses").

The Herb Chambers acquisition continues Asbury's geographic expansion into the northeast region of the United States.

As a result of the Herb Chambers acquisition, we acquired substantially all of the assets including the real property related thereto, for a total preliminary purchase price of approximately $ 1.76 billion, which includes $ 292.0 million of new vehicle floor plan financing, $ 300.0 million of used vehicle financing, $ 623.3 million of borrowings under a revolving credit facility, and $ 546.5 million of borrowings under a real estate facility.

The Businesses comprise 33 dealerships, 52 franchises and three collision centers.

The Businesses are included in our Dealerships segment.

The sources of the preliminary purchase consideration are as follows:

(In millions)

New vehicle floor plan facility $ 292.0

Used vehicle floor plan facility 300.0

Revolving credit facility 623.3

Real estate facility 546.5

Preliminary purchase price $ 1,761.8

Under the acquisition method of accounting, the tangible and intangible assets acquired and liabilities assumed are recorded at their estimated fair value based on information currently available.

The following table summarizes the amounts recorded based on preliminary estimates of fair value:

Summary of Assets Acquired and Liabilities Assumed

(In millions)

Inventories, net $ 372.1

Other current assets 56.6

Total current assets 428.7

Property and equipment, net 605.5

Goodwill 341.7

Intangible franchise rights 428.5

Operating lease right-of-use assets 39.8

Total assets acquired $ 1,844.2

Operating lease liabilities 39.8

Other liabilities 42.6

Total liabilities assumed 82.4

Net assets acquired $ 1,761.8

The estimated fair values of the assets acquired and liabilities assumed and the related preliminary acquisition accounting are based on management’s estimates and assumptions, as well as other information compiled by management, including the books and records of the Businesses.

The effects of measurement period adjustments on our consolidated statement of income for the year ended December 31, 2025 were not material.

Furthermore, we recorded a $ 34.7 million measurement period adjustment to reflect the fair value of franchise rights acquired, with a corresponding increase to goodwill, within our consolidated balance sheets during the three months ended December 31, 2025.

We believe that the information gathered to date provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed.

We continue to analyze the estimated values of all assets acquired and liabilities assumed including, among other things, finalizing third-party valuations;

therefore, the allocation of the purchase price remains preliminary and subject to revision during the measurement period, not to exceed one year from the acquisition date.

Approximately $ 428.5 million of the purchase price was assigned to the indefinite lived franchise rights intangible assets related to the dealer agreements applicable to each new vehicle dealership.

In addition, goodwill of $ 341.7 million was recognized and is primarily attributable to the anticipated synergies that Asbury expects to derive from the Herb Chambers acquisition as well as the acquired assembled workforce of the Businesses.

The Company recorded $ 16.5 million of acquisition related costs during the year ended December 31, 2025.

These costs are included in selling, general, and administrative expenses in the consolidated statements of income.

Goodwill and manufacturer franchise rights associated with our Dealerships segment acquisitions are deductible for federal and state income tax purposes ratably over a 15-year period.

The Company's consolidated statements of income included revenue and net income attributable to the Businesses from July 21, 2025 through December 31, 2025 of $ 1.16 billion and $ 35.4 million, respectively.

The following represents the unaudited pro forma information as if the Herb Chambers acquisition had been included in the consolidated results of the Company since January 1, 2024:

For the Year Ended December 31,

(In millions)

Pro forma revenue $ 20,330.9 $ 19,865.3

Pro forma net income $ 479.4 $ 418.3

The above pro forma financial information adjusts the revenue and net income related to the Herb Chambers acquisition primarily for depreciation, rent and interest expense, assuming that the fair value adjustments and indebtedness incurred in connection with the Herb Chambers acquisition had occurred on January 1, 2024.

They have also been adjusted to reflect the $ 16.5 million of acquisition related costs during the year ended December 31, 2025, as having occurred on January 1, 2024.

The pro forma information also assumes that the July 2025 divestiture of two Lexus and two General Motors dealerships occurred on January 1, 2024, due to manufacturer requirements upon the consummation of the Herb Chambers acquisition.

The pro forma net income for the year ended December 31, 2025 and 2024 includes $ 141.0 million and $ 149.5 million, respectively, of asset impairments recorded by the Company.

Koons Acquisition

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Measurement period adjustments recorded during the year ended December 31, 2024 and their related effects on our consolidated statements of income were not material.

Furthermore, we recorded a $ 26.7 million measurement period adjustment to reflect the fair value of franchise rights acquired, with a corresponding increase to goodwill, within our consolidated balance sheet during the year ended December 31, 2024.

Approximately $ 401.0 million of the purchase price was assigned to the indefinite lived franchise rights intangible assets related to the dealer agreements applicable to each new vehicle dealership.

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Pro forma net income $ 660.8 $ 1,092.9

The above pro forma financial information adjusts the revenue and net income related to the Koons acquisition primarily for (1) depreciation and interest expense assuming that the fair value adjustments and indebtedness incurred in connection with the Koons acquisition had occurred on January 1, 2022 and (2) the exclusion of Koons Lexus of Wilmington, which is classified as

assets held for sale as of December 31, 2023.

The pro forma net income for the year ended December 31, 2023 includes $ 117.2 million of asset impairments recorded by the Company during the fourth quarter of 2023.

Other Acquisitions and Divestitures

On February 14, 2025, the Company, through one of its subsidiaries, entered into a Transaction Agreement with various entities that comprise the Herb Chambers Dealerships.

See Note 23 "Subsequent Event” for more information.

There were no other acquisitions during the years ended December 31, 2025, 2024 and 2023.

During the year ended December 31, 2024, we sold one Lexus franchise ( one dealership location) in Wilmington, Delaware due to OEM requirements in connection with the Koons acquisition, one Nissan franchise ( one dealership location) in Denver, Colorado, one Nissan franchise ( one dealership location) in Atlanta, Georgia, one Chevrolet franchise ( one dealership location) in Atlanta, Georgia and one Honda franchise ( one dealership location) in Spokane, Washington.

During the year ended December 31, 2025, we sold the following franchises:

Manufacturer Franchises Locations States

Toyota 3 3 California;

Nissan 1 1 Colorado

Chrysler Jeep Dodge Ram 12 4 Colorado;

Volvo 1 1 South Carolina

Lexus 2 2 Utah

Chevrolet Buick GMC 4 3 Utah;

Ford 1 1 Utah

The Company recorded a pre-tax gain totaling $ 80.2 million which is presented in our accompanying consolidated statements of income as a gain on dealership divestitures, net.

During the year ended December 31, 2024, we sold the following franchises:

Manufacturer Franchises Locations States

Nissan 2 2 Colorado;

Lexus 1 1 Delaware

Chevrolet 1 1 Georgia

Honda 1 1 Washington

The Company recorded a pre-tax gain totaling $ 8.6 million which is presented in our accompanying consolidated statements of income as a gain on dealership divestitures, net.

During the year ended December 31, 2023, we sold one franchise ( one dealership location) in Austin, Texas.

The Company recorded a pre-tax gain totaling $ 13.5 million.

During the year ended December 31, 2022, we sold one franchise ( one dealership location) in St.

Louis, Missouri, three franchises ( three dealership locations) and one collision center in Denver, Colorado, two franchises ( two dealership locations) in Spokane, Washington, one franchise ( one dealership location) in Albuquerque, New Mexico and 11 franchises ( nine dealership locations) and two collision centers in North Carolina.

The Company recorded a pre-tax gain totaling $ 207.1 million.

ACCOUNTS RECEIVABLE

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____________________________

(a) Inventories, net as of December 31, 2024 and December 31, 2023, excluded $ 58.7 million and $ 84.5 million classified as assets held for sale, respectively.

(a) Inventories, net as of December 31, 2025 and 2024, excluded $ 96.5 million and $ 58.7 million classified as assets held for sale, respectively.

The lower of cost and net realizable value reserves reduced total inventory cost by $ 9.0 million and $ 9.7 million, respectively, as of December 31, 2025 and 2024.

1 unchanged sentence

ASSETS HELD FOR SALE

Assets and liabilities classified as held for sale include assets and liabilities associated with pending dealership disposals, and real estate not currently used in our operations that we are actively marketing to sell.

Assets and liabilities classified as held for sale include assets and liabilities associated with pending dealership disposals, and real estate that we are actively marketing to sell.

A summary of assets held for sale and liabilities associated with assets held for sale is as follows:

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Net assets held for sale $ 267.0 $ 172.4

As of December 31, 2024, assets held for sale consisted of seven franchises ( six dealership locations) in a ddit ion to one real estate property not currently used in our operations.

As of December 31, 2023, assets held for sale consisted of 11 franchises ( 11 dealership locations) in addition to one real estate property not currently used in our operations.

As of December 31, 2025, assets held for sale consisted of 15 franchises ( 11 dealership locations) in addition to two real estate properties.

In March 2025, the Company recognized a $ 14.3 million pre-tax non-cash franchise rights impairment charge in connection with five dealerships that were classified as assets held for sale in March 2025.

In September 2025, the Company recognized an $ 11.7 million pre-tax non-cash franchise rights impairment charge in connection with a dealership that met the assets held for sale criteria in October 2025.

The quantitative assessment for each disposal group included a comparison of the estimated fair value to the carrying value of the disposal group less costs to sell.

The Company determined the estimated fair value of each disposal group based on estimated sales proceeds less costs to sell.

These franchise rights impairment charges are reflected in asset impairments in our consolidated statement of income for the year ended December 31, 2025.

As of December 31, 2024, assets held for sale consisted of seven franchises ( six dealership locations) in addition to one real estate property.

During the year ended December 31, 2025, the Company sold 24 franchises ( 15 dealership locations) for a pre-tax gain totaling $ 80.2 million.

During the year ended December 31, 2024, the Company sold five franchises ( five dealership locations) for a pre-tax gain totaling $ 8.6 million.

During the year ended December 31, 2023, the Company sold one franchise ( one dealership location) for a pre-tax gain totaling $ 13.5 million.

OTHER CURRENT ASSETS

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Our investment portfolio is primarily funded by product premiums from the sale of our TCA F&I products.

The amortized cost, gross unrealized gains and losses and estimated fair values of debt securities available-for-sale and other investments measured at net asset value are as follows:

The amortized cost, gross unrealized gains and losses and estimated fair values of debt securities available-for-sale measured at net asset value are as follows:

As of December 31, 2025

2 unchanged sentences

Short-term investments $ 0.5 $ — $ — $ 0.5

U.S Treasury 2.6 — — 2.6

Treasuries 2.6 — — 2.6

Municipal 4.9 0.1 — 5.0

6 unchanged sentences

Short-term investments $ 14.4 $ — $ — $ 14.4

U.S Treasury 13.6 0.1 ( 0.1 ) 13.5

Treasuries 2.6 — — 2.6

Municipal 10.6 0.1 ( 0.1 ) 10.6

6 unchanged sentences

As of December 31, 2025

Amortized Costs Fair Value

Amortized Cost Fair Value

(In millions)

8 unchanged sentences

During the year ended December 31, 2024, we recorded $ 1.2 million gross gains and $ 0.6 million gross losses realized related to the sales of available-for-sale debt securities carried at fair value.

During the year ended December 31, 2023, we recorded $ 3.7 million gross gains and $ 0.9 million gross losses realized related to the sales of equity securities carried at fair value.

During the year ended December 31, 2023, we recorded $ 0.5 million gross gains and $ 1.5 million gross losses realized related to the sales of available-for-sale debt securities carried at fair value.

9 unchanged sentences

Short-term investments $ — $ — $ 0.5 $ — $ 0.5 $ —

U.S Treasury 1.1 — 1.4 — 2.5 —

Municipal 3.4 ( 0.1 ) 1.6 — 4.9 ( 0.1 )

Treasuries — — 0.8 — 0.8 —

Corporate 4.8 — — — 4.8 —

6 unchanged sentences

Short-term investments $ 0.3 $ — $ 3.9 $ — $ 4.1 $ —

U.S Treasury 3.4 ( 0.1 ) 5.0 ( 0.1 ) 8.5 ( 0.1 )

Treasuries 1.1 — 1.4 — 2.5 —

Municipal 3.4 ( 0.1 ) 1.6 — 4.9 ( 0.1 )

28 unchanged sentences

Intangible franchise rights is an asset representing our rights under franchise agreements with vehicle manufacturers.

In connection with the Koons acquisition, we recorded goodwill of $ 272.4 million and franchise rights of $ 401.0 million.

Goodwill related to the Koons acquisition was allocated to the Dealerships segment.

In connection with the Herb Chambers acquisition, we recorded goodwill of $ 341.7 million and franchise rights of $ 428.5 million.

Goodwill related to the Herb Chambers acquisition was allocated to the Dealerships segment.

The changes in goodwill and intangible franchise rights for the years ended December 31, 2025 and 2024 are as follows:

8 unchanged sentences

Balance as of December 31, 2024 (a) $ 1,508.1 $ 536.6 $ 2,044.7

Reclassified from assets held for sale 29.6 — 29.6

Acquisitions 341.7 — 341.7

Divestitures ( 71.8 ) — ( 71.8 )

Impairments ( 1.3 ) — ( 1.3 )

Reclassified to assets held for sale ( 33.3 ) — ( 33.3 )

5 unchanged sentences

Balance as of December 31, 2023 $ 2,095.8

Reclassified from assets held for sale 71.9

Acquisitions - measurement-period adjustments ( 26.7 )

Divestitures ( 74.6 )

Impairments ( 148.2 )

2 unchanged sentences

Reclassified from assets held for sale 23.1

Acquisitions - measurement-period adjustments ( 26.7 )

Acquisitions 428.5

Divestitures ( 120.2 )

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The Company estimates fair value by using a discounted cash flow model (income approach) based on market participant assumptions related to the cash flows directly attributable to the franchise.

These assumptions include year-over-year and terminal growth rates, weighted average cost of capital, future gross margins, and future selling, general and administrative expenses.

These assumptions include year-over-year and terminal growth rates, weighted average cost of capital and future EBITDA margins.

We performed a quantitative impairment test for certain underperforming stores as of our annual impairment testing date, October 1, 2025.

The results of the quantitative impairment testing identified that the carrying values of certain of our franchise rights intangible assets exceeded their fair value by $ 115.0 million and the related impairment charge was recorded during the three months ended December 31, 2025.

Taking into account the $ 26.0 million of franchise rights impairments discussed in Note 6, Assets Held for Sale, in total, we recognized a $ 141.0 million pre-tax non-cash impairment charge related to our franchise rights intangible assets during the year ended December 31, 2025.

Based on the underperformance of certain stores, we performed quantitative impairment tests in the second quarter of 2024 and as of our annual impairment testing date, October 1, 2024.

1 unchanged sentence

In total, we recognized a $ 148.2 million pre-tax non-cash impairment charge related to our franchise rights intangible assets during the year ended December 31, 2024.

Based on the underperformance of certain stores, limited primarily to two brands, along with an increase in discount rates, we performed quantitative impairment tests of franchise rights for certain stores in our Dealerships segment as of October 1, 2023.

The results of the quantitative impairment testing identified that the carrying values of certain of our franchise rights intangible assets exceeded their fair value.

As a result, we recognized a $ 73.1 million pre-tax non-cash impairment charge related to our franchise rights intangible assets during the year ended December 31, 2023.

We also performed qualitative impairment assessments on the remaining franchise rights as of October 1, 2025 and 2024, respectively.

The results of our qualitative impairment assessments on the remaining franchise rights indicated that the fair values of the franchise rights related to those dealerships more likely than not exceeded their carrying values.

Additionally, in connection with changes in reporting units in our Dealerships segment, we performed qualitative and quantitative impairment tests of goodwill for the affected reporting units as of October 1, 2024 and 2023, both before and after the change in reporting units.

We performed qualitative impairment tests of goodwill for all reporting units as of October 1, 2025.

The results of our qualitative goodwill impairment assessments for all reporting units indicated that the fair values of the reporting units more likely than not exceeded their carrying values.

Additionally, in connection with changes in reporting units in our Dealerships segment, we performed qualitative and quantitative impairment tests of goodwill for the affected reporting units as of October 1, 2024, both before and after the change in reporting units.

Lastly, we performed an interim quantitative impairment test of goodwill for two reporting units in the second quarter of 2024.

The quantitative impairment tests of goodwill included a comparison of the estimated fair value to the carrying value of the reporting unit.

The quantitative impairment tests of goodwill, related to certain reporting units, as of October 1, 2024, and during the second quarter of 2024 included a comparison of the estimated fair value to the carrying value of the reporting unit.

The Company estimates fair value by using a discounted cash flow model (income approach) based on market participant assumptions.

These assumptions include year-over-year and terminal growth rates, weighted average cost of capital, future gross margins, and future selling, general and administrative expenses.

The results of our quantitative goodwill impairment tests during the second quarter of 2024 and as of October 1, 2024 and 2023 related to certain reporting units indicated that the fair value of these reporting units exceeded their carrying values.

We performed qualitative impairment assessments on the remaining reporting units as of October 1, 2024 and 2023, respectively.

The results of our quantitative goodwill impairment tests during the second quarter of 2024 and as of October 1, 2024, indicated that the fair value of these reporting units exceeded their carrying values.

We performed qualitative impairment assessments on the remaining reporting units as of October 1, 2024.

The results of our qualitative impairment assessments of goodwill related to the remaining reporting units indicated that the fair values of the reporting units more likely than not exceeded their carrying values.

We also recorded a goodwill impairment charge of $ 1.3 million during the year ended December 31, 2024 related to one dealership that met the assets held for sale criteria in June 2024.

The quantitative impairment test of the disposal group included a comparison of the estimated fair value to the carrying value of the disposal group less cost to sell.

In December 2023, certain dealerships met the held for sale criteria and the assets and liabilities associated with these dealerships were reclassified as assets held for sale and liabilities associated with assets held for sale in our consolidated balance sheets.

As a result, we evaluated the disposal groups to ensure their recording at the lower of their carrying value or fair value less costs to sell.

The quantitative impairment tests of each disposal group included a comparison of the estimated fair value to the carrying value of the disposal group less costs to sell.

The Company determined the estimated fair value of each disposal group based on the estimated sales proceeds less cost to sell.

As a result of this analysis, we recorded asset impairment charges of $ 44.1 million in 2023.

These asset impairment charges are reflected in asset impairments in our consolidated statements of income.

Since the resulting impairment charges and the decision to dispose of these dealerships represented a triggering event for goodwill, we performed quantitative impairment tests of goodwill for the affected reporting units in December 2023.

The results of our quantitative goodwill impairment tests for the affected reporting units indicated that the fair value of these reporting units exceeded their carrying values.

In total, we recognized asset impairments of $ 149.5 million and $ 117.2 million during the years ended December 31, 2024 and 2023, respectively.

These asset impairment charges are reflected in asset impairments in our consolidated statements of income.

FLOOR PLAN NOTES PAYABLE—TRADE

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The 2023 Senior Credit Facility amended and restated the Company’s pre-existing third amended and restated credit agreement, dated as of September 25, 2019, among the Company, certain of its subsidiaries, Bank of America, as administrative agent, and the other lenders party thereto.

The 2023 Senior Credit Facility provides for the following, in each case subject to limitations on availability as set forth therein:

• $ 500.0 million revolving credit facility (the "Revolving Credit Facility");

• $ 1.93 billion new vehicle revolving floorplan facility (the "New Vehicle Floorplan Facility");

• $ 375.0 million used vehicle revolving floorplan facility (the "Used Vehicle Floorplan Facility").

Proceeds from borrowings under the 2023 Senior Credit Facility will be used, among other things, (i) to finance the purchase of new and used vehicles by the Company and certain of its subsidiaries, (ii) for working capital needs of the Company and certain of its subsidiaries, and (iii) for other general corporate purposes of the Company and certain of its subsidiaries.

On April 9, 2025, the Company obtained an amendment (the “Amendment”) to the 2023 Senior Credit Facility, by and among the Company, as a borrower, certain of its subsidiaries, as vehicle borrowers, Bank of America, N.A., ("Bank of America") as administrative agent, and the other lenders party thereto.

The Amendment, among other things, provided for the following, subject to satisfaction of certain other customary conditions in each case:

• an increase of the aggregate commitments under the revolving credit facility, from $ 500.0 million to $ 925.0 million;

• an increase of the aggregate commitments under the new vehicle floor plan facility, from $ 1.93 billion to $ 2.25 billion.

Aggregate commitments of $ 375.0 million under the used vehicle revolving floorplan facility did not change as a result of the Amendment .

The increases under the Amendment were effective concurrently with the consummation of the Herb Chambers acquisition, which occurred on July 21, 2025.

Subject to compliance with certain conditions, the 2023 Senior Credit Facility provides that we have the ability, at our option and subject to the receipt of additional commitments from existing or new lenders, to increase the size of the facilities by up to $ 750.0 million in the aggregate.

38 unchanged sentences

Accrued advertising 11.8 6.1

Acquisition related liabilities 0.2 6.4

Other 35.1 38.6

10 unchanged sentences

2025 Real Estate Facility 537.4 —

2021 Real Estate Facility 442.1 579.9

2021 BofA Real Estate Facility 151.2 158.6

2 unchanged sentences

2015 Wells Fargo Master Loan Facility — 32.0

2023 Syndicated Revolving Credit Facility 120.0 —

Finance lease liability 8.3 8.4

38 unchanged sentences

The Company completed the registration of the 2028 Notes and 2030 Notes in October 2020.

We are a holding company with no independent assets or operations.

For all relevant periods presented, our 2028 Notes and 2030 Notes have been fully and unconditionally guaranteed, on a joint and several basis, by substantially all of our subsidiaries other than the TCA Non-Guarantor Subsidiaries.

3 unchanged sentences

In addition, the interest rate was amended to 5.8 % over the revised term.

As of December 31, 2024, and 2023, we had total mortgage notes payable outstanding of $ 29.6 million and $ 31.9 million, respectively, that are collateralized by the associated real estate, which excludes amounts classified as liabilities associated with assets held for sale.

As of December 31, 2025, and 2024, we had total mortgage notes payable outstanding of $ 27.2 million and $ 29.6 million, respectively, that are collateralized by the associated real estate.

2025 Wells Fargo Real Estate Facility

On July 21, 2025, certain subsidiaries of the Company borrowed $ 546.5 million under the 2025 Real Estate Facility, dated as of July 21, 2025 (the “Real Estate Credit Agreement”) by and among the Company, certain of the Company’s subsidiaries that own or lease the real estate financed thereunder, as borrowers, Wells Fargo, as administrative agent, and the various financial institutions parties thereto, as lenders.

The Real Estate Facility matures ten years from the initial funding date.

The Company used the proceeds from these borrowings, together with other available funds, to finance the Herb Chambers acquisition.

Term loans under the 2025 Real Estate Facility bear interest, at our option, based on (1) SOFR plus 2 % per annum or (2) the Base Rate (as described below) plus 1 % per annum.

The Base Rate is the highest of (a) the Prime Rate, (b) the Federal Funds Rate plus .50 % and (c) Term SOFR for a one month tenor in effect on such date plus 1 %.

We are required to make 118 consecutive monthly principal payments, commencing September 1, 2025, with a balloon repayment of the outstanding principal amount of loans due on the Maturity Date.

Borrowings und er the 2025 Real Estate Facility are guaranteed by the Company and certain of the Company’s subsidiaries, and are collateralized by first priority liens, subject to certain permitted exceptions, on all of the real property financed thereunder.

The representations, warranties and covenants in the Real Estate Credit Agreement are customary for financing transactions of this nature, including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case as set out in the Real Estate Credit Agreement.

In addition, certain other covenants could restrict our ability to incur additional debt, pay dividends or acquire or dispose of assets.

The Real Estate Credit Agreement also provides for events of default that are customary for financing transactions of this

nature, including cross-defaults to other material indebtedness.

Upon the occurrence of an event of default, we could be required by the Real Estate Credit Agreement to immediately repay all amounts outstanding thereunder.

As of December 31, 2025, we had $ 537.4 million in term loans outstanding under the 2025 Real Estate Facility.

2021 Real Estate Facility

8 unchanged sentences

2021 BofA Real Estate Facility

On May 25, 2022, we entered into the second amendment to the credit agreement to, among other things, revise the benchmark interest rate payable on term loans under our 2021 BofA Real Estate Facility.

Interest is payable, at our option, based on (1) SOFR plus 0.10 %, plus 1.65 % per annum or (2) the Base Rate plus 0.65 % per annum.

The Base Rate is the highest of (i) the Federal Funds rate plus 0.50 %, (ii) the Bank of America prime rate, (iii) SOFR plus 0.10 %, plus 1.00 %, and (iv) 1.00 %.

On May 20, 2021, the Company and certain of its subsidiaries borrowed $ 184.4 million under a real estate term loan credit agreement, dated as of May 10, 2021 (the "2021 BofA Real Estate Credit Agreement"), by and among the Company and certain of its subsidiaries, Bank of America, N.A., as administrative agent and the various financial institutions party thereto, as lenders, which provides for term loans in an aggregate amount equal to $ 184.4 million, subject to customary terms and conditions (the "2021 BofA Real Estate Facility").

1 unchanged sentence

The Company completed the purchase of the leased real property on May 20, 2021.

Interest is payable, at our option, based on (1) SOFR plus 0.10 %, plus 1.65 % per annum or (2) the Base Rate plus 0.65 % per annum.

The Base Rate is the highest of (i) the Federal Funds rate plus 0.50 %, (ii) the Bank of America prime rate, (iii) SOFR plus 0.10 %, plus 1.00 %, and (iv) 1.00 %.

We are required to make 39 consecutive quarterly principal payments of 1.00 % of the initial amount of each loan, with a balloon repayment of the outstanding principal amount of loans due on the maturity date.

7 unchanged sentences

2018 BofA Real Estate Facility

On May 25, 2022, we entered into the third amendment to the credit agreement to revise the benchmark interest rate payable on term loans under our 2018 BofA Real Estate Facility.

Interest is payable, at our option, based on SOFR plus 0.10 %, plus 1.50 % or the Base Rate plus 0.50 %.

The Base Rate is the highest of (i) the Federal Funds rate plus 0.50 %, (ii) the Bank of America prime rate, (iii) SOFR plus 0.10 %, plus 1.00 %, and (iv) 1.00 %.

On November 13, 2018, we entered into a real estate term loan credit agreement (as amended, restated or supplemented from time to time, the "2018 BofA Real Estate Credit Agreement") with Bank of America, as lender, providing for term loans in an aggregate amount not to exceed $ 128.1 million, subject to customary terms and conditions (the "2018 BofA Real Estate Facility").

2 unchanged sentences

Borrowings under the 2018 BofA Real Estate Facility are guaranteed by each of our operating dealership subsidiaries whose real estate is financed under the 2018 BofA Real Estate Facility, and are collateralized by first priority liens, subject to certain permitted exceptions, on all of the real property financed thereunder.

As of December 31, 2024 and 2023, we had $ 37.9 million and $ 50.3 million, respectively, in term loans outstanding under the 2018 BofA Real Estate Facility, which excludes amounts classified as liabilities associated with assets held for sale.

On May 25, 2022, we entered into the third amendment to the credit agreement to revise the benchmark interest rate payable on term loans under our 2018 BofA Real Estate Facility.

Interest is payable, at our option, based on SOFR plus 0.10 %, plus 1.50 % or the Base Rate plus 0.50 %.

The Base Rate is the highest of (i) the Federal Funds rate plus 0.50 %, (ii) the Bank of America prime rate, (iii) SOFR plus 0.10 %, plus 1.00 %, and (iv) 1.00 %.

In November 2025, we paid off the aggregate principal amounts remaining under the 2018 BofA Real Estate Facility for an aggregate amount of approximately $ 34.2 million.

As of December 31, 2024, we had $ 37.9 million in term loans outstanding under the 2018 BofA Real Estate Facility.

2018 Wells Fargo Master Loan Facility

On June 1, 2022, certain of our subsidiaries entered into the second amendment to the master loan agreement that revised interest payable from a LIBOR reference rate to SOFR plus 0.10 %, plus an applicable margin based on a pricing grid ranging from 1.50 % to 1.85 % per annum based on our consolidated total lease adjusted leverage ratio.

On November 16, 2018, certain of our subsidiaries entered into a master loan agreement (the "2018 Wells Fargo Master Loan Agreement" and, together with the 2013 BofA Real Estate Credit Agreement, the 2015 Wells Fargo Master Loan Agreement and the 2018 BofA Real Estate Agreement, the "Existing Real Estate Credit Agreements") with Wells Fargo Bank, National Association, as lender, which provides for term loans to certain of our subsidiaries that are borrowers under the Wells Fargo Master Loan Agreement in an aggregate amount not to exceed $ 100.0 million (the "Wells Fargo Master Loan Facility"), subject to customary terms and conditions (the "2018 Wells Fargo Master Loan Facility").

3 unchanged sentences

Borrowings under the 2018 Wells Fargo Master Loan Facility are guaranteed by us pursuant to an unconditional guaranty, and all of the real property financed by any of our operating dealership subsidiaries under the 2018 Wells Fargo Master Loan Facility is collateralized by first priority liens, subject to certain permitted exceptions.

As of December 31, 2025 and 2024, we had $ 57.2 million and $ 62.2 million, respectively, outstanding borrowings under the 2018 Wells Fargo Master Loan Facility.

2015 Wells Fargo Master Loan Facility

On February 3, 2015, certain of our subsidiaries entered into an amended and restated master loan agreement (as amended, restated or supplemented from time to time, the "2015 Wells Fargo Master Loan Agreement") with Wells Fargo Bank, National Association ("Wells Fargo"), as lender, which provides form term loans to certain of our subsidiaries that are borrowers under the 2015 Wells Fargo Master Loan Agreement in an aggregate amount not to exceed $ 100.0 million (the "2015 Wells Fargo Master Loan Facility").

1 unchanged sentence

We are required to make quarterly principal payments with respect to the initial amount of each loan in 108 equal monthly principal payments based on a hypothetical nineteen-year amortization schedule, with a balloon repayment of the outstanding principal amount of loans due on February 1, 2025.

On February 21, 2025, the agreement was modified and the maturity date was extended to June 1, 2025.

Borrowings under the 2015 Wells Fargo Master Loan Facility can be voluntarily prepaid in whole or in part any time without premium or penalty.

Borrowings under the 2015 Wells Fargo Master Loan Facility are guaranteed by us pursuant to an unconditional guaranty, and all of the real property financed by any of our operating

dealership subsidiaries under the 2015 Wells Fargo Master Loan Facility is collateralized by first priority liens, subject to certain permitted exceptions.

As of December 31, 2024 and 2023, we had $ 32.0 million and $ 37.2 million, respectively, outstanding under the 2015 Wells Fargo Master Loan Facility.

Borrowings under the 2015 Wells Fargo Master Loan Facility are guaranteed by us pursuant to an unconditional guaranty, and all of the real property financed by any of our operating dealership subsidiaries under the 2015 Wells Fargo Master Loan Facility is collateralized by first priority liens, subject to certain permitted exceptions.

The outstanding balance under this agreement in the amount of $ 31.6 million was paid off in May 2025.

As of December 31, 2024 we had $ 32.0 million outstanding under the 2015 Wells Fargo Master Loan Facility.

2013 BofA Real Estate Facility

On May 25, 2022, we entered into the third amendment to the credit agreement to revise the benchmark interest rate payable on term loans under our 2013 BofA Real Estate Facility.

Interest is payable, at our option, based on SOFR plus 0.10 %, plus 1.50 % or the Base Rate plus 0.50 %.

The Base Rate is the highest of (i) the Federal Funds rate plus 0.50 %, (ii) the Bank of America prime rate, (iii) SOFR plus 0.10 %, plus 1.00 %, and (iv) 1.00 %.

Our right to make draws under the 2013 BofA Real Estate Facility terminated on December 26, 2013.

On September 26, 2013, we entered into a real estate term loan credit agreement (the "2013 BofA Real Estate Credit Agreement") with Bank of America, N.A.

2 unchanged sentences

In June 2023, the Company prepaid the aggregate principal amounts remaining under the 2013 BofA Real Estate Facility for an aggregate amount of approximately $ 23.9 million with cash on hand.

On May 25, 2022, we entered into the third amendment to the credit agreement to revise the benchmark interest rate payable on term loans under our 2013 BofA Real Estate Facility.

Interest is payable, at our option, based on SOFR plus 0.10 %, plus 1.50 % or the Base Rate plus 0.50 %.

The Base Rate is the highest of (i) the Federal Funds rate plus 0.50 %, (ii) the Bank of America prime rate, (iii) SOFR plus 0.10 %, plus 1.00 %, and (iv) 1.00 %.

Our right to make draws under the 2013 BofA Real Estate Facility terminated on December 26, 2013.

Summary of Mortgages

3 unchanged sentences

Captive mortgages $ 27.2 $ 84.2 2034 $ 29.6 $ 84.9 2034

2025 Real Estate Facility 537.4 591.4 2035 — — N/A

2021 Real Estate Facility 442.1 694.9 2026 579.9 845.9 2026

2021 BofA Real Estate Facility 151.2 191.2 2031 158.6 195.0 2031

2018 BofA Real Estate Facility 37.9 59.4 2025 50.3 72.7 2025

2018 Wells Fargo Master Loan Facility 62.2 94.4 2028 72.0 103.6 2028

2018 BofA Real Estate Facility — — N/A 37.9 59.4 2025

2018 Wells Fargo Master Loan Facility 57.2 81.6 2028 62.2 94.4 2028

2015 Wells Fargo Master Loan Facility — — N/A 32.0 93.4 2025

Total mortgage debt $ 1,215.1 $ 1,643.3 $ 900.2 $ 1,362.8

3 unchanged sentences

Availability under the Revolving Credit Facility is limited by borrowing base calculations and is reduced on a dollar-for-dollar basis by the aggregate face amount of any outstanding letters of credit.

As of December 31, 2025, we had $ 25.2 million in outstanding letters of credit, $ 120.0 million of outstanding borrowings, and $ 747.3 million of borrowing availability, with an additional $ 495.0 million available to convert from our new vehicle floorplan facility.

As of December 31, 2024, we had $ 14.0 million in outstanding letters of credit, nothing drawn on our Revolving Credit Facility and $ 486.0 million of borrowing availability.

As of December 31, 2023, we had $ 14.0 million in outstanding letters of credit, nothing drawn on our Revolving Credit Facility and $ 332.1 million of borrowing availability, with an additional $ 389.0 million available to convert from our new vehicle floorplan facility.

Proceeds from borrowings from time to time under the revolving credit facility may be used for among other things, acquisitions, working capital and capital expenditures.

Stock Repurchase and Dividend Restrictions

The 2023 Senior Credit Facility and the Indentures currently allow for restricted payments without limit so long as our Consolidated Total Leverage Ratio (as defined in the 2023 Senior Credit Facility and the Indentures) is not greater than 3.0 to

1.0 after giving effect to such proposed restricted payments.

Restricted payments generally include items such as dividends, share repurchases, unscheduled repayments of subordinated debt, or purchases of certain investments.

Subject to our continued compliance with a consolidated fixed charge coverage ratio and a maximum consolidated total lease adjusted leverage ratio, in each case as set out in the Indentures, restricted payments capacity additions (or subtractions if negative) equal to a base level plus the cumulative amount of (i) 50 % of our net income (as defined in the 2023 Senior Credit Facility) plus (ii) 100 % of any cash proceeds we receive from the sale of equity interests minus (iii) the dollar amount of share purchases made and dividends paid during the defined measurement periods, subject to certain exceptions.

Subject to our continued compliance with a consolidated fixed charge coverage ratio and a maximum consolidated total lease adjusted leverage ratio, in

each case as set out in the Indentures, restricted payments capacity additions (or subtractions if negative) equal to a base level plus the cumulative amount of (i) 50 % of our net income (as defined in the 2023 Senior Credit Facility) plus (ii) 100 % of any cash proceeds we receive from the sale of equity interests minus (iii) the dollar amount of share purchases made and dividends paid during the defined measurement periods, subject to certain exceptions.

In the event that our Consolidated Total Leverage Ratio does (or would) exceed 3.0 to 1.0, the 2023 Senior Credit Facility and the Indentures would then also allow for restricted payments under mutually exclusive parameters, subject to certain exclusions.

13 unchanged sentences

Upon the occurrence of an event of default, the Company could be required to immediately repay all amounts outstanding under the applicable facility.

The representations and covenants contained in the 2025 Real Estate Facility are customary for financing transactions of this nature, including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case as set out in the 2025 Real Estate Facility.

In addition, certain other covenants could restrict our ability to incur additional debt, pay dividends or acquire or dispose of assets.

The 2025 Real Estate Facility also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness.

Upon the occurrence of an event of default, we could be required to immediately repay all amounts outstanding thereunder.

The representations and covenants contained in the 2021 BofA Real Estate Facility are customary for financing transactions of this nature, including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case as set out in the 2021 BofA Real Estate Facility.

6 unchanged sentences

Upon the occurrence of an event of default, we could be required to immediately repay all amounts outstanding thereunder.

The representations and covenants contained in the 2018 BofA Real Estate Credit Agreement are customary for financing transactions of this nature, including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio, in each case as set out in the 2018 BofA Real Estate Credit Agreement.

In addition, certain other covenants could restrict our ability to incur additional debt, pay dividends or acquire or dispose of assets.

The 2018 BofA Real Estate Credit Agreement also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness.

Upon the occurrence of an event of default, we could be required by the 2018 BofA Real Estate Credit Agreement to immediately repay all amounts outstanding thereunder.

The representations, warranties and covenants contained in the 2018 Wells Fargo Master Loan Agreement and the related documents are customary for financing transactions of this nature, including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio.

In addition, certain other covenants could restrict our ability to incur additional debt, pay dividends or acquire or dispose of assets.

The 2018 Wells Fargo Master Loan Agreement also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness.

Upon the occurrence of an event of default, we could be required by the 2018 Wells Fargo Master Loan Facility to immediately repay all amounts outstanding thereunder.

The representations, warranties and covenants contained in the 2015 Wells Fargo Master Loan Agreement and the related documents are customary for financing transactions of this nature, including, among others, a requirement to comply with a minimum consolidated fixed charge coverage ratio and maximum consolidated total lease adjusted leverage ratio.

In addition, certain other covenants could restrict our ability to incur additional debt, pay dividends or acquire or dispose of assets.

The 2015 Wells Fargo Master Loan Agreement also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness.

2018 Wells Fargo Master Loan Agreement also provides for events of default that are customary for financing transactions of this nature, including cross-defaults to other material indebtedness.

Upon the occurrence of an event of default, we could be required by the 2018 Wells Fargo Master Loan Facility to immediately repay all amounts outstanding thereunder.

19 unchanged sentences

Financial instruments consist primarily of cash and cash equivalents, investments, contracts-in-transit, accounts receivable, cash surrender value of corporate-owned life insurance policies, accounts payable, floor plan notes payable, subordinated long-term debt, mortgage notes payable, and interest rate swap instruments.

The carrying values of our financial instruments, with the exception of subordinated long-term debt and mortgage notes payable, approximate fair value primarily due to (i) their short-term nature, (ii) recently completed market transactions, or (iii) existence of variable interest rates, which approximate market rates.

The carrying values of our financial instruments, with the exception of subordinated long-term debt and mortgage notes payable bearing interest at fixed rates, approximate fair value primarily due to (i) their short-term nature, (ii) recently completed market transactions, or (iii) existence of variable interest rates, which approximate market rates.

The fair value of our subordinated long-term debt is based on reported market prices in an inactive market that reflects Level 2 inputs.

9 unchanged sentences

5.00 % Senior Notes due 2032

Mortgage notes payable 29.6 31.9

Mortgage notes payable bearing interest at fixed rates

Total carrying value $ 2,261.6 $ 2,260.6

4 unchanged sentences

5.00 % Senior Notes due 2032

Mortgage notes payable 29.3 31.9

Mortgage notes payable bearing interest at fixed rates

Total fair value $ 2,218.5 $ 2,115.8

Interest Rate Swap Agreements

We currently have six interest rate swap agreements.

We currently have four interest rate swap agreements.

These swaps are designed to provide a hedge against changes in variable rate cash flows regarding fluctuations in the SOFR rate.

All interest rate swap agreements with an inception date of 2021 and prior were amended on June 1, 2022 to provide a hedge against changes in variable rate cash flows regarding fluctuations in SOFR as compared to the previous benchmark rate of one-month LIBOR.

The revisions to the interest rate swap agreements did not impact our hedge accounting because we applied the accounting expedients outlined in ASU 2020-04 and ASU 2021-01 of ASC Topic 848, Reference Rate Reform .

The following table provides information on the attributes of each swap as of December 31, 2025:

Inception Date Notional Principal at Inception Notional Value as of December 31, 2024

Notional Principal at Maturity Maturity Date

Inception Date Notional Principal at Inception Notional Value as of December 31, 2025 Notional Principal at Maturity Maturity Date

(In millions)

3 unchanged sentences

July 2020 $ 93.5 $ 65.8 $ 50.6 December 2028

July 2020 $ 85.5 $ 62.7 $ 57.3 November 2025

June 2015 $ 100.0 $ 53.5 $ 53.1 February 2025

The fair value of cash flow swaps is calculated as the present value of expected future cash flows, determined on the basis of forward interest rates and present value factors.

10 unchanged sentences

These interest rate swaps are marked to market at each reporting date and any unrealized gains or losses are included in accumulated other comprehensive income and reclassified to interest expense in the same period or periods during which the hedged transactions affect earnings.

Information about the effect of our interest rate swap agreements in the accompanying consolidated statements of income and consolidated statements of comprehensive income, is as follows (in millions):

Information about the

effect of our interest rate swap agreements in the accompanying consolidated statements of income and consolidated statements of comprehensive income, is as follows (in millions):

For the Year Ended December 31, Results Recognized in Accumulated Other Comprehensive Income/(Loss)

(Effective Portion) Location of Results Reclassified from Accumulated Other Comprehensive Loss

(Effective Portion) Location of Results Reclassified from Accumulated Other Comprehensive Income/(Loss) to Earnings

Results Reclassified from Accumulated Other Comprehensive Income/(Loss)

2 unchanged sentences

2023 $ 12.1 Other interest expense, net $ ( 34.7 )

On the basis of yield curve conditions as of December 31, 2024 and including assumptions about future changes in fair value, we expect the amount to be reclassified out of accumulated other comprehensive income into earnings within the next 12 months will be gains of $ 20.3 million.

On the basis of yield curve conditions as of December 31, 2025 and including assumptions about future changes in fair value, we expect the amount to be reclassified out of accumulated other comprehensive income into earnings within the next 12 months will be gains of approximately $ 13.2 million.

The table below presents the Company’s investment securities that are measured at fair value on a recurring basis aggregated by the level in the fair value hierarchy within which those measurements fall:

4 unchanged sentences

Short-term investments 0.5 — — 0.5

U.S Treasury 2.6 — — 2.6

Treasuries 2.6 — — 2.6

Municipal — 5.0 — 5.0

7 unchanged sentences

Short-term investments 3.5 10.9 — 14.4

Treasury 13.5 — — 13.5

Treasuries 2.6 — — 2.6

Municipal — 10.6 — 10.6

6 unchanged sentences

Available-for-sale debt securities are recorded at fair value and any unrealized gains or losses are included in accumulated other comprehensive income and reclassified to finance and insurance, net revenue in the period or periods during which the debt securities are sold and the gains or losses are realized.

Information about the effect of our available-for-sale debt securities in the accompanying consolidated statements of income and consolidated statements of comprehensive income, is as follows (in millions):

Information about the effect of our available-for-sale debt securities

in the accompanying consolidated statements of income and consolidated statements of comprehensive income, is as follows (in millions):

For the Year Ended December 31, Results Recognized in Accumulated Other Comprehensive Income/(Loss)

(Effective Portion) Location of Results Reclassified from Accumulated Other Comprehensive Loss

(Effective Portion) Location of Results Reclassified from Accumulated Other Comprehensive Income/(Loss) to Earnings

Results Reclassified from Accumulated Other Comprehensive Income/(Loss)

17 unchanged sentences

Income tax provision at the statutory rate $ 139.0 21.0 $ 120.8 21.0 $ 168.3 21.0

State income tax expense, net of federal benefit 22.8 4.0 29.8 3.7 42.7 3.2

State income tax expense, net of federal benefit (a)

28.6 4.3 22.8 4.0 29.8 3.7

Non-deductible items 2.9 0.5 2.5 0.4 1.7 0.2

1 unchanged sentence

Income tax expense $ 170.2 25.7 $ 145.0 25.2 $ 198.8 24.8

_____________________________

(a) State taxes in Massachusetts, Florida, and Virginia make up the majority (greater than 50 percent) of the tax effect in this category.

Deferred income tax asset and liability components consisted of the following:

19 unchanged sentences

There were no valuation allowances recorded against the deferred tax assets as of December 31, 2025 or 2024.

As of December 31, 2025, we had an income tax payable of $ 4.4 million included in accounts payable and other accrued liabilities.

As of December 31, 2024, we had an income tax receivable of $ 3.4 million, included in other current assets and an income tax payable of $ 5.7 million included in accounts payable and other accrued liabilities.

As of December 31, 2023, we had income tax receivable of $ 11.5 million, included in Other current assets.

The statutes of limitation related to our consolidated Federal income tax returns are closed for all tax years up to and including 2021.

2 unchanged sentences

We believe that our tax positions comply with applicable tax law and that we have adequately provided for these matters.

During the years ended December 31, 2025, 2024, and 2023 we made income tax payments, net of refunds received, totaling $ 139.8 million, $ 78.7 million, and $ 191.9 million, respectively.

Income Taxes Paid For the Year Ended December 31,

2025 2024 2023

(In millions)

Federal $ 118.3 $ 63.7 $ 158.0

State (a) 21.6 15.0 33.9

Total $ 139.8 $ 78.7 $ 191.9

__________________________

(a) The amount of income taxes paid during the year for individual states does not meet the 5% disaggregation threshold.

OTHER LONG-TERM LIABILITIES

10 unchanged sentences

Included in these interest payments are $ 82.8 million, $ 99.4 million, and $ 4.0 million, of floor plan interest payments for the years ended December 31, 2025, 2024, and 2023, respectively.

During the years ended December 31, 2024, 2023, and 2022 we made income tax payments, net of refunds received, totaling $ 78.7 million , $ 191.9 million, and $ 198.4 million, respectively.

During the years ended December 31, 2025, 2024, and 2023, we transferred $ 507.5 million, $ 489.7 million, and $ 431.2 million, respectively, of loaner vehicles from other current assets to inventory in our consolidated balance sheets.

18 unchanged sentences

Operating Liabilities held for sale 0.4 0.2

Finance Current maturities of long-term debt — —

Operating Operating lease liabilities 221.6 200.0

45 unchanged sentences

Certain of our lease agreements include financial covenants and incorporate by reference the financial covenants set forth in the 2023 Senior Credit Facility.

A breach of any of these covenants could immediately give rise to certain landlord remedies

under our various lease agreements, the most severe of which include the following:

A breach of any of these covenants could immediately give rise to certain landlord remedies under our various lease agreements, the most severe of which include the following:

(i) termination of the applicable lease and/or other leases with the same or an affiliated landlord under a cross-default provision, (ii) eviction from the premises;

6 unchanged sentences

Our Chief Operating Decision Maker (CODM) is our Chief Executive Officer who manages the business, regularly reviews financial information and allocates resources at the geographic region level for our dealerships and at the TCA segment level for our F&I product provider's operations.

The geographic dealership group operating segments have been aggregated into one operating segment disclosed as the Dealerships reportable segment since their operations (i) have similar economic characteristics (our regions all have similar long-term average gross margins), (ii) offer similar products and services (all of our regions offer new and used vehicles, parts and service, and finance and insurance products), (iii) have similar customers, (iv) have similar distribution and marketing practices (all of our regions distribute products and services through dealership facilities that region to customers in similar ways), and (v) operate under similar regulatory environments.

and insurance products), (iii) have similar customers, (iv) have similar distribution and marketing practices (all of our regions distribute products and services through dealership facilities that region to customers in similar ways), and (v) operate under similar regulatory environments.

TCA's vehicle protection products are sold through affiliated dealerships and the revenue from the related commissions is included in finance and insurance, net revenue in the Dealerships segment before consolidation.

5 unchanged sentences

Segment operating income is derived from GAAP operating income, adjusted to exclude the effects of asset impairments and to include floor plan interest expense.

Asset impairments are excluded as they are non-recurring in nature and typically do not arise from the ordinary course of operations.

Asset impairments are excluded as they typically do not arise from the ordinary course of operations.

By removing these charges, segment operating income better represents the underlying operational performance of the segments.

6 unchanged sentences

Therefore, there are no reconciling items between segment operating income and income from operations for the TCA segment.

Goodwill acquired in the Koons acquisition, which closed in December 2023, of $ 272.4 million was allocated to the Dealerships segment.

Goodwill acquired in the Herb Chambers acquisition, which closed in July 2025, of $ 341.7 million was allocated to the Dealerships segment.

The majority of TCA’s revenue arises from sales through our affiliated dealerships.

5 unchanged sentences

Reportable segment financial information for the years ended December 31, 2025, 2024 and 2023 is as follows:

As of and for the year ended December 31, 2024

For the year ended December 31, 2025

Dealerships TCA Total

2 unchanged sentences

Intersegment revenue

F&I 235.1 — 235.1

Parts and service 36.8 — 36.8

Total intersegment revenue 271.9 — 271.9

$ 17,944.8 $ 326.1 $ 18,270.9

33 unchanged sentences

Total assets $ 10,389.5 $ 1,024.3 $ 11,413.8 $ 204.4 $ 11,618.2

As of and for the year ended December 31, 2023

For the year ended December 31, 2024

Dealerships TCA Total

2 unchanged sentences

Intersegment revenue

F&I 183.0 — 183.0

Parts and service 39.5 — 39.5

Total intersegment revenue 222.5 — 222.5

$ 17,107.5 $ 303.6 $ 17,411.1

33 unchanged sentences

Total assets $ 9,227.6 $ 1,049.4 $ 10,277.0 $ 60.1 $ 10,337.0

As of and for the year ended December 31, 2022

For the year ended December 31, 2023

Dealerships TCA Total

2 unchanged sentences

Intersegment revenue

F&I 146.8 — 146.8

Parts and service 34.6 — 34.6

Total intersegment revenue 181.5 — 181.5

$ 14,699.0 $ 285.2 $ 14,984.2

7 unchanged sentences

Finance and insurance — 208.1

Selling, general and administrative expenses

Personnel costs 1,106.5 —

12 unchanged sentences

Total intersegment eliminations 36.1

Other operating income 4.4

Asset impairments ( 117.2 )

Other interest expense, net ( 156.1 )

11 unchanged sentences

We responded to the CID by producing information and documents for the period August 1, 2019 to April 24, 2023.

On February 8, 2024, the FTC staff counsel sent to us a proposed consent order and draft complaint, alleging that the Company and three of our dealerships had violated Section 5 of the Federal Trade Commission Act ("FTC Act") and certain provisions of the Equal Credit Opportunity Act ("ECOA") in connection with the sale of add-on products (e.g., vehicle service contracts, maintenance plans, etc.), and advising that it would recommend the filing of an enforcement action if the Company did not settle the FTC’s claims.

On February 8, 2024, the FTC staff counsel sent to us a proposed consent order and draft complaint, alleging that the Company and three of our dealerships had violated Section 5 of the Federal Trade Commission Act (“FTC Act”) and certain provisions of the Equal Credit Opportunity Act in connection with the sale of add-on products (e.g., vehicle service contracts, maintenance plans, etc.), and advising that it would recommend the filing of an enforcement action if the Company did not settle the FTC’s claims.

On August 16, 2024, after discussions with the FTC stalled, the FTC initiated an administrative proceeding by filing an enforcement action against the Company.

On October 4, 2024, the Company filed suit against the FTC in the United States District Court for the Northern District of Texas, seeking to enjoin the FTC’s administrative proceeding on the ground that the administrative proceeding was unconstitutional.

While the Company disputes the FTC’s allegations that it violated the FTC Act and the ECOA, we are unable to reasonably predict the possible outcome of this matter at this time, or provide a reasonably possible range of loss, if any.

Among other things, the Company’s lawsuit asserts that the FTC’s administrative proceeding violates the Company’s constitutional rights by denying it the right to a jury trial and by allowing the FTC to serve as both prosecutor and judge in the same proceeding.

The Company’s lawsuit also contends that FTC commissioners and in-house administrative law judges are effectively insulated from removal by the President in contravention of the Constitution’s requirements.

The FTC’s administrative proceeding and the Company’s lawsuit remain pending.

While the Company disputes the FTC’s allegations, we are at this time unable to reasonably predict the possible outcome of this matter, or provide a reasonably possible range of loss, if any.

There can be no assurance that the Company will succeed in either the FTC’s administrative proceeding against the Company or in the Company’s lawsuit against the FTC, and the FTC’s allegations, whether meritorious or not, may adversely affect our ability to attract customers, result in the loss of existing customers, harm our reputation and cause us to incur defense costs and other expenses.

20 unchanged sentences

Compliance with these provisions has not had, nor do we expect such compliance to have, any material effect upon our capital expenditures, net earnings, financial condition, liquidity or competitive position.

We believe that our current practices and procedures for the control and disposition of such materials comply with applicable federal, state and local

requirements.

We believe that our current practices and procedures for the control and disposition of such materials comply with applicable federal, state and local requirements.

No assurances can be provided, however, that future laws or regulations, or changes in existing laws or regulations, would not require us to expend significant resources in order to comply therewith.

18 unchanged sentences

As of December 31, 2025, there was $ 20.7 million of total unrecognized share-based compensation expense related to non-vested share-based awards granted under the 2012 Plan and 2019 Plan, and the weighted average period over which it is expected to be recognized is 1.5 years.

Further, we expect to recognize $ 2.6 million of this expense in 2025, $ 9.1 million in 2026, $ 4.6 million in 2027.

Further, we expect to recognize $ 3.0 million of this expense in 2026, $ 11.1 million in 2027, and $ 6.6 million in 2028.

Performance Share Units

During the year ended December 31, 2025, the Compensation and Human Resources Committee of the Board of Directors approved the grant of up to 64,309 performance share units, which represents 150 % of the target award.

Performance share units provide an opportunity for the employee-recipient to receive a number of shares of our common stock based on our performance during a specified year period following the grant as measured against objective performance goals as determined by the Compensation and Human Resources Committee of our Board of Directors.

Performance share units provide an opportunity for the employee-recipient to receive a number of shares of our common stock based on our performance during a specified period following the grant as measured against objective performance goals as determined by the Compensation and Human Resources Committee of our Board of Directors.

The actual number of units earned may range from 0 % to 150 % of the target number of units depending upon achievement of the performance goals.

35 unchanged sentences

As of December 31, 2024 all restricted stock awards have vested.

The following table summarizes information about restricted stock awards for 2024:

Shares Weighted Average Grant

Date Fair Value

Non-vested at January 1, 2024 2,169 $ 69.18

Vested ( 2,169 ) 69.18

Non-vested at December 31, 2024 — $ —

The weighted average grant-date fair value of restricted stock awards and total fair value of restricted stock awards vested are summarized in the following table:

10 unchanged sentences

The Company's expense related to employer matching contributions totaled $ 19.2 million, $ 18.4 million and, $ 16.0 million for the years ended December 31, 2025, 2024 and 2023, respectively.

SUBSEQUENT EVENT

On February 14, 2025, the Company, through one of its subsidiaries, entered into a Purchase and Sale Agreement (the "Transaction Agreement") with various entities that comprise the Herb Chambers automotive group (the "Herb Chambers Dealerships").

Pursuant to the Transaction Agreement, the Company is expected to acquire substantially all of the assets, including all real property and businesses of the Herb Chambers Dealerships (collectively, the "Businesses") for an aggregate purchase price of approximately $ 1.34 billion, which includes $ 750 million for goodwill and approximately $ 590 million for the real estate and leasehold improvements.

In addition, the Company will acquire new vehicles, used vehicles, service loaner vehicles, fixed assets, parts and supplies for a purchase price to be determined at the closing (the "Closing") of the transactions set forth in the Transaction Agreement and will reimburse the Herb Chambers Dealerships for certain dealership construction and development costs incurred prior to the Closing.

The Businesses includes 33 dealerships, 52 franchises and three collision centers.

Herb Chambers will retain ownership of the Mercedes-Benz of Boston dealership in Somerville, Massachusetts (the "MB Boston Dealership").

The Transaction Agreement includes certain restrictions and obligations regarding the sale of the MB Boston Dealership, including a put right obligating the Company to purchase the MB Boston Dealership during the five-year period following the Closing, absent certain circumstances.

The Company's acquisition of the Businesses is anticipated to close in the second quarter of 2025 and is subject to various customary closing conditions, including approval from the applicable automotive manufacturers.

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data