Radiant Logistics enters into commitment letters for three facilities

By Marisa Wong

Madison, Wis., Jan. 23 – Radiant Logistics, Inc. entered into a series of commitment letters on Jan. 19 for a new $65 million senior secured revolving cross-border credit facility with Bank of America, NA, a C$29 million senior secured Canadian term loan from Integrated Private Debt Fund IV LP and a $25 million subordinated secured term loan from Alcentra Capital Corp. and Triangle Capital Corp., according to an 8-K filing with the Securities and Exchange Commission.

The $65 million revolver replaces the company’s existing $30 million facility.

Proceeds of the facilities will be used to pay a portion of the consideration for Radiant’s arrangement agreement with Wheels Group Inc. and for general corporate purposes, including potential future acquisitions. Under the arrangement agreement, Radiant’s newly formed indirect wholly owned subsidiary will acquire all of Wheels’ outstanding common shares.

The commitments are subject to various conditions, including consummation of the arrangement.

Senior secured revolver

The senior credit facility with Bank of America will mature on Aug. 9. 2018.

Interest is equal to Libor (or Canadian BA rate, if applicable) plus 150 basis points to 225 bps, depending on the company’s fixed-charge coverage ratio.

There is also an unused line fee equal to 37.5 bps, and letter-of-credit fees are equal to the applicable Libor margin.

The facility includes a covenant requiring compliance with a minimum fixed-charge coverage ratio.

Canadian term loan

The Canadian term loan has a term of nine years and an eight-year amortization schedule beginning 12 months after funding of the loan.

Interest is equal to the greater of (a) 6.65% and (b) the yield on equivalent term Government of Canada bonds plus 450 bps.

Subordinated term loan

The subordinated debt from Alcentra and Triangle has a term of six years.

Interest is 12% cash payable quarterly from the closing date for at least the first six months. After that, the interest rate is Libor plus 1,100 basis points, adjustable to Libor plus 950 bps or Libor plus 1,025 bps depending on total leverage, subject to a 1% Libor floor.

The debt may be prepaid at any time after the first year, subject to a 3% call premium in year two.

Closing is slated for March 31.

Radiant is a Bellevue, Wash.-based non-asset-based transportation and logistics services company that provides domestic and international freight-forwarding services.

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