SECTION 1. REGISTRANT’S BUSINESS AND OPERATIONS.
Item 1.01. Entry into a Material Definitive Agreement.
On December 30, 2024, Clue Opco LLC (the “Borrower”), a subsidiary of Forward Air Corporation (the “Company”), the revolving lenders
party thereto and Citibank, N.A., as administrative agent and collateral agent, entered into Amendment No. 3 (“Amendment No. 3”) to the Credit Agreement, dated as of December 19, 2023 (as amended, supplemented or otherwise
modified prior to the date of Amendment No. 3, the “Credit Agreement”).
Amendment No. 3 amends the Credit Agreement to:
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modify the financial performance covenant by increasing the maximum consolidated first lien net leverage ratio to
6.75:1.00 for the quarters ending December 31, 2024 through and including September 30, 2025, which steps down by 0.25x for each of the next five quarters through December 31, 2026 and is thereafter maintained at 5.50:1.00;
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reduce the revolving credit commitments available under the Credit Agreement from an aggregate amount of
$340,000,000 to an aggregate amount of $300,000,000; |
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potential to reduce the revolving credit facility by another $50,000,000 to $250,000,000 if the consolidated
first lien net leverage ratio exceeds 6.50:1.00 for any quarter starting in the first quarter of 2025, unless the Company makes a prepayment of its Term B loans in an aggregate amount of at least $50,000,000, at which time such reduction provision
will be nullified for future periods; |
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restrict the Borrower’s ability to make certain restricted payments, unless its consolidated total net
leverage ratio is less than 4.00:1.00; and |
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include an anti-cash hoarding covenant, which will be effective only during the period from the closing date of
Amendment No. 3 through December 31, 2026, requiring Borrower to prepay the revolving credit loans if it has more than $120 million of unrestricted cash on the last day of each calendar month in which revolving credit loans are
outstanding or on the day that is five business days after the date of any borrowing of a revolving credit loan. |
The proceeds from the
Credit Agreement may be used for working capital and general corporate purposes. The primary purpose of Amendment No. 3 is to provide the Company with additional financial flexibility to fund any future growth opportunities in support of the
Company’s long-term strategy.
From time to time, the financial institutions party to the Credit Agreement or their affiliates have performed, and
may in the future perform, various commercial banking, investment banking and other financial advisory services for the Company and its affiliates for which they have received, and will receive, customary fees and expenses.
The description of the Amendment No. 3 does not purport to be complete and is qualified in its entirety by reference to the full text of such agreement,
which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated by reference herein.
SECTION 2. FINANCIAL INFORMATION.
Item 2.02.
Results of Operations and Financial Condition.
On January 6, 2025, the Company issued a press release to reaffirm the Company’s previously
issued financial guidance for the fiscal year ended December 31, 2024. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.
The information furnished pursuant to Items 2.02 and 9.01, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities
Act of 1933, as amended, or the Exchange Act (the “Securities Act”).