KNIGHT-SWIFT TRANSPORT HOLDINGS INC. : Entering into a material definitive agreement, terminating a material definitive arrangement, creating a direct financial obligation or obligation under an off-balance sheet arrangement of a registrant (Form 8-K)
SECTION 1.01 ACCESS TO A MATERIAL DEFINITIVE AGREEMENT
September 3, 2021(the "Closing Date"), Knight-Swift Transportation Holdings Inc.(the "Company") entered into a $2.3 billionunsecured credit facility with the lenders thereto, Bank of America, N.A. as Administrative Agent, Swingline Lender, and Issuing Lenderand Wells Fargo Bank, National Associationand PNC Bank National Associationas Co-Syndication Agents (the "2021 Debt Agreement"), replacing the Company's previous $1.1 billionunsecured credit facility (the "2017 Debt Agreement") and the $1.2 billionunsecured term loan (the "2021 Term Loan"). The 2021 Debt Agreement includes the following facilities: •$1.1 billion revolving line of credit (the "2021 Revolver"), $350.0 millionof which was drawn upon the Closing Date, maturing September 3, 2026•$0.2 billion term loan (the "2021 Term Loan A-1"), maturing December 3, 2022•$0.2 billion term loan (the "2021 Term Loan A-2"), maturing September 3, 2024•$0.8 billion term loan (the "2021 Term Loan A-3"), maturing September 3, 2026There are no scheduled principal payments due on the 2021 Revolver, the 2021 Term Loan A-1, or the 2021 Term Loan A-2 until the respective maturity dates noted above. For the 2021 Term Loan A-3, scheduled principal payments commence on September 30, 2024, payable in equal quarterly installments of $10.0 million, with the remaining outstanding balance due at the final maturity date on September 3, 2026. The interest rates applicable to the 2021 Debt Agreement are subject to leverage-based grids and as of the Closing Date were equal to the Bloomberg Short-term Bank Yield ("BSBY") rate plus 1.125% for the 2021 Revolver and 2021 Term Loan A-3 and the BSBY rate plus 1.000% for the 2021 Term Loan A-1 and 2021 Term Loan A-2. The 2021 Debt Agreement includes certain financial covenants with respect to a maximum consolidated net leverage ratio and a minimum consolidated interest coverage ratio. The 2021 Debt Agreement includes usual and customary events of default for a facility of this nature and provides that, upon the occurrence and continuation of an event of default, payment of all amounts payable under the 2021 Debt Agreement may be accelerated, and the lenders' commitments may be terminated. The 2021 Debt Agreement contains certain usual and customary restrictions and covenants relating to, among other things, dividends (which would be restricted only if a default or event of default had occurred and was continuing or would result therefrom), liens, affiliate transactions, and other indebtedness. The foregoing description of the 2021 Debt Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the 2021 Debt Agreement, which will be filed with the Company's Form 10-Q for the quarter ended September 30, 2021. ITEM 1.02 TERMINATION OF A MATERIAL DEFINITIVE AGREEMENT Concurrently with entering into the 2021 Debt Agreement on the Closing Date, the Company paid off and terminated the 2017 Debt Agreement and the 2021 Term Loan. The 2017 Debt Agreement was by and among the Company as the borrower, as well as Wells Fargo Bank, National Associationas Administrative Agent, Swingline Lender and Issuing Lender, and Bank of America, N.A. and PNC Bank National Associationas Co-Syndication Agents. The 2017 Debt Agreement included a $0.8 billionrevolving credit facility (of which $350.6 millionface value was outstanding as of the Closing Date) and a $0.3 billionterm loan, which were each scheduled to mature on October 3, 2022. As of September 3, 2021, there was $1.2 billionoutstanding under the previous 2021 Term Loan, an agreement that was by and among the Company as the borrower and Bank of America, N.A. as the lender. The previous 2021 Term Loan was scheduled to mature on October 3, 2022. Upon the Closing Date, proceeds from the 2021 Term Loans A-1, A-2, and A-3, $350.0 milliondrawn under the 2021 Revolver, and $4.7 millionof cash on hand were used to pay off the then-outstanding balances and accrued interest and fees under the 2017 Debt Agreement and the 2021 Term Loan, as well as certain transaction fees and expenses associated with the 2021 Debt Agreement. ITEM 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT
The information set out in Item 1.01 above relating to the 2021 Loan Agreement is incorporated by reference in this Item 2.03.
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