Covenant Transportation ups revolver to $95 million, extends maturity

By Toni Weeks

San Luis Obispo, Calif., Jan. 30 - Covenant Transportation Group, Inc. extended the maturity date of its revolving credit facility to September 2017 from September 2014 and increased the commitments to $95 million from $85 million, according to a press release detailing the company's financial and operating results for the fourth quarter and year ended Dec. 31.

The amendments were made on Dec. 31 with lead banks Bank of America and JPMorgan.

The company said in the release that the facility's pricing grid was reduced, providing for at least $500,000 of annual interest savings.

According to the release, Covenant Transportation secured more financial flexibility by eliminating the leverage ratio coverage and the $15 million minimum availability requirement. In addition, the fixed-charge coverage will be tested only if excess revolver availability is less than $11.9 million, the release noted.

Commenting on the amendments, chairman, president and chief executive officer David R. Parker said in the release: "Giving effect to the amendment's terms, pro forma borrowing availability under the revolving facility at Dec. 31, assuming the $39.6 million in letters of credit and approximately zero borrowings outstanding at such date, would have been $52.7 million."

Covenant Transportation is a Chattanooga, Tenn.-based provider of truckload transportation services.

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