Business Context and Reporting Period
This Form 8-K filed by Ford Motor Company on May 20, 2026, reports the closing of a Joint Venture Disposition Agreement involving BlueOval SK, LLC ("BOSK"). The transaction marks the exit of Ford from the joint venture with SK On and SK Battery America, Inc., originally formed to build EV battery plants in Tennessee and Kentucky.
Key Financial Metrics and Obligations
- Debt Assumption: Ford assumed a promissory note payable to the U.S. Department of Energy (DOE) in the amount of $3,805,040,000 related to a single Kentucky battery plant.
- Interest Rate: The assumed loan carries an interest rate of 4.814% per annum.
- Repayment Terms: Quarterly interest-only payments are required through January 15, 2030. Quarterly principal and interest payments commence April 15, 2030, with a final maturity date of July 15, 2040.
- Liquidity Covenant: The new loan agreement requires Ford to maintain Available Liquidity of at least $4,000,000,000.
- Capital Contribution Relief: Ford's requirement to contribute up to $6.6 billion in capital to BOSK over a five-year period was terminated.
Material Changes Versus Prior Period
- Joint Venture Exit: Ford's membership interest in BOSK was redeemed, and Ford was released from its obligations under the Sponsor Support, Share Retention and Subordination Agreement (SSA), including the guarantee of 50% of BOSK's payment obligations.
- Asset Acquisition: Ford Energy Battery LLC ("FEB"), a wholly owned subsidiary of Ford, acquired all of BOSK's interests in the two Kentucky battery plants, subject to existing DOE liens.
- Liability Restructuring: While Ford exited the joint venture structure, it directly assumed the debt obligation for the Kentucky plant previously held by BOSK.
Outlook, Risks, and Covenants
The new Ford DOE Loan Agreement includes affirmative covenants regarding financial statement delivery and maintenance of corporate existence. Negative covenants limit mergers, liens, sale-leaseback transactions, and specific transactions by FEB.
Events of Default include:
- Materially incorrect representations or warranties.
- Breach of covenants (subject to grace periods).
- Cross-payment default or cross-acceleration regarding debt of $1,000,000,000 or more.
- Bankruptcy of Ford, Ford Motor Credit Company LLC, Ford Canada, or significant guarantors.
- U.S. judgments against Ford or guarantors exceeding $100,000,000 (single) or $200,000,000 (aggregate).
The filing text does not provide specific revenue, profit, or cash flow figures for the reporting period, as this is a current report focused on a specific transaction.
Investor Verification Checklist
- Verify the exact status of the Tennessee battery plant, as the filing specifies the acquisition of interests in the two Kentucky plants only.
- Confirm the impact of the $3.8 billion debt assumption on Ford's total leverage ratios and credit rating.
- Review the definition of "Available Liquidity" in the new agreement to ensure compliance with the $4 billion minimum threshold.
- Assess the operational integration of the Kentucky plants under Ford Energy Battery LLC versus the previous joint venture structure.