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Item 1.01
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Entry into a Material Definitive Agreement.
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On
November 28, 2018, Celadon Group, Inc. (the “Company”) entered into a Twelfth Amendment to Amended and Restated Credit Agreement (the “Amendment”) by and among the Company, certain subsidiaries of the Company as guarantors, Bank of America, N.A., as lender and Administrative Agent, Wells Fargo Bank, N.A., and Citizens Bank, N.A., both as lenders, which amends the Company's existing Amended and Restated Credit Agreement dated December 12, 2014, among the same parties (as amended, the “Credit Agreement”). Among other changes, the Amendment:
(i) extends the maturity date of the Credit Agreement to June 28, 2019; (ii) changes the aggregate lender commitments and maximum amount of outstanding indebtedness under the Credit Agreement, including loans and letters of credit, to $238,240,000 as of November 28, 2018, $178,240,000 as of January 31, 2019, $128,240,000 as of February 28, 2019, and $93,240,000 as of March 31, 2019; (iii) changes the existing loan sub-limit to $203,240,000 as of November 28, 2018, $143,240,000 as of January 31, 2019, $93,240,000 as of February 28, 2019, and $58,240,000 as of March 31, 2019; (iv) requires the Company to certify to the lenders, on or before March 31, 2019, that the Company has executed one or more letters of intent and paid the necessary due diligence or similar upfront fees required thereunder in connection with a prospective transaction or transactions that would repay the Credit Agreement in full on or before the maturity date; (v) amends the asset coverage ratio financial covenant so that a ratio of 1.0 to 1.0 is required through the maturity of the Credit Agreement and increases the cap on the aggregate value of real property that can be included in the calculation of the ratio from $85.0 million to $93.0 million; (vi) amends the Fixed Charge Coverage Ratio financial covenant to be measured on a trailing twelve-month basis instead of a trailing six-month basis; (vii) amends the Lease-Adjusted Total Debt to EBITDAR Ratio, Fixed Charge Coverage Ratio, and Maximum Disbursements financial covenant levels to reflect the Company’s budget plus a customary cushion; (viii) increases the interest rate on letters of credit to 8.0%, effective March 1, 2019; (ix) amends the letter of credit facility to permit the issuance of letters of credit with expiration dates of March 2, 2020 or earlier; (x) increases the amount of cash collateral required to secure letters of credit in the event of a full payoff of the Credit Agreement from 105% to 110%; and (xi) requires a fee (the “Twelfth Amendment Fee”) of 4.0% of the aggregate commitments, which is equal to $9,529,600, of which 40% is due and payable on April 1, 2019, 30% is due and payable May 1, 2019, and the remainder is due and payable on June 3, 2019. If the Credit Agreement is repaid in full on or before January 31, 2019, 100% of the Twelfth Amendment Fee is forgiven, if the Credit Agreement is repaid in full on or before February 28, 2019, 87.5% of the Twelfth Amendment Fee is forgiven, and if the Credit Agreement is repaid in full on or before March 29, 2019, 75% of the Twelfth Amendment Fee is forgiven.
The description of the Amendment does not purport to be complete and is qualified in its entirety by the full text of the Amendment, which is filed herewith as Exhibit 10.1.
