YRC Worldwide completed an amendment to extend the maturity of its term loan credit agreement with a lender group led by Credit Suisse Cayman Islands Branch from February 2019 to July 2022.
“As our financial performance has improved in recent years, we reduced our debt to the lowest level in more than a decade while at the same time reinvesting back into the company,” said James Welch, CEO of YRC Worldwide. “Extending the term loan is an important step as we continue to position the company for long-term success. We believe it is prudent to take the refinancing risk off the table before the term loan matured in early 2019, to focus on executing operationally and improving our financial results. We plan to continue evaluating additional opportunities to strengthen the company for our customers, employees and investors.”
In addition to the extended maturity, the most substantial changes as a result of the amendment are:
- A reduction of the outstanding principal to $600 million following a $35.2 million payment at the time of closing the amendment
- An increase in the annual amortization from 1% ($7 million) to 3% ($18 million)
- An increase in the interest rate from LIBOR + 750 basis points to LIBOR + 850 basis points
- If contribution deferral agreement notes are not extended to at least late October 2022, the term loan maturity will be reset to within 60 days before the CDA’s scheduled maturity
“Extending the maturity of the term loan and reducing the outstanding principal considerably strengthens our capital structure,” said Stephanie Fisher, CFO of YRC Worldwide. “With the successful extension of the term loan, we have met the conditions for extending the maturity of our asset-based loan facility from February 2019 to June 2021.”
YRC Worldwide is a U.S.-based holding company of freight shipping brands including YRC Freight, YRC Reimer, New Penn, USF Holland and USF Reddaway.