Item 1.01 Entry into a Material Definitive Agreement.
Revolving Credit Facility
Radiant Logistics, Inc. (the “Company,” “we” or “us”) and Radiant Global Logistics, Inc. (“RGLI”) entered into a USD$200.0 million syndicated, revolving credit facility (the “Credit Facility”) pursuant to a Credit Agreement dated as of August 5, 2022 (the “Credit Agreement”). The Credit Facility was entered into with Bank of America, N.A. and BMO Capital Markets Corp. as joint book runners and joint lead arrangers, Bank of America, N.A. as Administrative Agent, Swingline Lender and Letter of Credit Issuer, Bank of Montreal as syndication agent, KeyBank National Association and MUFG Union Bank, N.A. as co-documentation agents and Bank of America, N. A., Bank of Montreal, Keybank National Association, MFUG Union Bank, N.A. and Washington Federal Bank, National Association as lenders (such named lenders are collectively referred to herein as “Lenders”). This replaces our USD$150.0 million facility dated March 13, 2020.
The Credit Facility has a term of five years and is collateralized by a first-priority security interest in the accounts receivable and other assets of the Company and the guarantors named below on a parity basis with the security interest held by Fiera Private Debt Fund IV LP and Fiera Private Debt Fund V LP described below. Borrowings under the Credit Facility accrue interest (at the Company’s option), at a) the Lenders’ base rate plus 0.75 and can be subsequently adjusted based on the Company’s consolidated net leverage ratio under the facility at the Lenders’ base rate plus 0.5% to 1.50%: b) Term SOFR plus 1.65% and can be subsequently adjusted based on the Company’s consolidated net leverage ratio under the facility at Term SOFR plus 1.40% to 2.40%; and c) Term SOFR Daily Floating Rate plus 1.65% and can be subsequently adjusted based on the Company’s consolidated net leverage ratio under the facility at Term SOFR Daily Floating Rate plus .40% to 12.40%. The guarantors of the Credit Facility are Adcom Express, Inc., Radiant Road & Rail, Inc., DBA Distribution Services, Inc., Radiant Trade Services, Inc., Radiant Transportation Services, Inc., Radiant Off-Shore Holdings LLC, Service by Air, Inc., International Freight Systems (of Oregon), Inc., Green Acquisition Company, Inc., Highways & Skyways, Inc., Radiant Global Logistics (CA), Inc., On Time Express, Inc., Radiant Customs Services, Inc., 2062698 Ontario Inc., Radiant Global Logistics (Canada) Inc., Radiant Logistics Global Services, Inc., Navegate, Inc., Radiant World Trade Services, Inc., Centrade, Inc., Navegate Logistics, Ltd., Radiant Logistics Domestic Services, Inc., Navegate Domestic, LLC, and Radiant Logistics Partners, LLC.
The Credit Facility includes a $75.0 million accordion feature to support future acquisition opportunities. For general borrowings under the Credit Facility, the Company is subject to the maximum consolidated net leverage ratio of 3.00 and minimum consolidated interest coverage ratio of 3.00. Additional minimum availability requirements and financial covenants apply in the event the Company seeks to use advances under the Credit Facility to pursue acquisitions or repurchase its common stock.
The foregoing description of the Credit Facility does not purport to be complete and is qualified in its entirety by reference to the full text of the Credit Agreement, a copy of which is filed herewith as Exhibit 10.1, and is incorporated by reference herein.
Amendment and Restatement of Existing Fiera Private Debt Fund IV LP Term Loan and Existing Fiera Private Debt Fund V LP Term Loan
The Company currently has two term loan facilities outstanding; one with Fiera Private Debt Fund IV LP (formerly, Integrated Private Debt Fund IV LP), as lender, for $29,000,000 and the other with Fiera Private Debt Fund V LP (formerly, Integrated Private Debt Fund V LP), as lender, for $10,000,000. Concurrently with entering into new Credit Facility, the Company amended and restated each such term loan to make the financial and other covenants in such term loans consistent with those contained in the new Credit Facility.
The foregoing description does not purport to be complete and is qualified in its entirety by reference to the full text of the $29,000,000 Credit Facilities Amended and Restated Loan Agreement, dated as of August 5, 2022, by and among Radiant Global Logistics (Canada) Inc., the affiliates of Radiant Global Logistics (Canada) Inc. a party thereto and Fiera Private Debt Fund IV LP and the $10,000,000 Credit Facilities Amended and Restated Loan Agreement, dated as of August 5, 2022, by and among Radiant Global Logistics (Canada) Inc., the affiliates of Radiant Global Logistics (Canada) Inc. a party thereto and Fiera Private Debt Fund V LP, which are filed herewith as Exhibits 10.2 and 10.3, respectively, and are incorporated by reference herein.
Intercreditor Agreement
The Lenders under the Credit Facility, on the one hand, and Fiera Private Debt Fund IV LP and Fiera Private Debt Fund V LP (collectively, “Fiera”), on the other hand, have entered into the First Lien Pari Passu Intercreditor Agreement, dated as of August 5, 2022 and acknowledged by the Company and its subsidiaries who are parties to such facilities (the “Intercreditor Agreement”). Pursuant to the Intercreditor Agreement, the Lenders and Fiera acknowledge that they both have first priority liens on substantially all of the assets of the Company and its subsidiaries who are parties to such facilities (“Shared Collateral”). The Intercreditor Agreement sets forth certain agreements between the Lenders and Fiera in dealing with such Shared Collateral, including notices of claims and defaults, enforcement actions upon any default and the disposition of any funds generated from any such enforcement actions or otherwise from the liquidation of any Shared Collateral upon any default.
The foregoing description of the Intercreditor Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the agreement, a copy of which is filed herewith as Exhibit 10.4, and is incorporated by reference herein.