Guarantor Subsidiaries | 9 Months Ended |
Sep. 30, 2013 |
Guarantor Subsidiaries | ' |
17. Guarantor Subsidiaries |
At and during the nine months ended September 30, 2013, there were outstanding 2018 Notes that were issued by our subsidiaries, QD LLC and QD Capital. The payment obligations of QD LLC and QD Capital under the 2018 Notes are guaranteed by QDI and by all of its domestic subsidiaries other than immaterial subsidiaries as further described below. |
The 2018 Notes are the senior obligations of our subsidiaries, QD LLC and QD Capital, and are secured by a subordinated, second-priority lien on assets that secure our ABL Facility through a collateral agreement that is separate from the indenture under which these notes were issued. Pursuant to an intercreditor agreement, the liens on the collateral securing the 2018 Notes rank junior in right of payment to the ABL Facility and obligations under certain hedging agreements and cash management obligations and certain other first-lien obligations. Decisions regarding the maintenance and release of the collateral secured by the collateral agreement are made by the lenders under our ABL Facility, and neither the indenture trustee nor the holders of the 2018 Notes have control of decisions regarding the release of the collateral. |
The 2018 Notes are also guaranteed on a second-priority senior secured basis, jointly and severally, by QDI, subsidiary guarantors, and certain of our future U.S. restricted subsidiaries. The guarantees of the subsidiary guarantors are full and unconditional subject to customary release provisions for sales of a subsidiary in compliance with other provisions of the indenture for the 2018 Notes (the “Notes Indenture”), foreclosures of a pledge of the equity interests of the subsidiary, the right to designate a subsidiary as unrestricted under the terms of the Notes Indenture, the discharge of the 2018 Notes or the defeasance of the Notes Indenture. The guarantee of QDI is full and unconditional. |
The subsidiary guarantors of all of the 2018 Notes are all of our direct and indirect domestic subsidiaries other than immaterial subsidiaries. No non-domestic subsidiaries are guarantor subsidiaries. QD Capital has no material assets or operations. QD LLC, all of the subsidiary guarantors and QD Capital are 100% owned by QDI. The subsidiary guarantors are 100% owned subsidiaries of QD LLC. QD LLC conducts substantially all of its business through and derives virtually all of its income from its subsidiaries. Therefore, its ability to make required principal and interest payments with respect to its indebtedness depends on the earnings of subsidiaries and its ability to receive funds from its subsidiaries through dividend and other payments. |
QDI has no significant restrictions on its ability to receive funds from its subsidiaries. The ABL Facility and the indenture governing our 2018 Notes contain certain limitations on QD LLC’s ability to make distributions to QDI. We do not consider these restrictions to be significant, because QDI is a holding company with no significant operations or assets, other than ownership of 100% of QD LLC’s membership units. QD LLC’s direct and indirect wholly-owned subsidiaries are generally permitted to make distributions to QD LLC, which is the principal obligor under the ABL Facility and the 2018 Notes. We do not believe that additional financial or narrative information about QDI, QD LLC, QD Capital or the subsidiary guarantors would be material to evaluating the guarantees. |
The following condensed consolidating financial information for QDI, QD LLC, and QD Capital, which has no assets or operations, non-guarantor subsidiaries and combined guarantor subsidiaries presents: |
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| • | | Condensed consolidating balance sheets at September 30, 2013 and December 31, 2012 and condensed consolidating statements of operations for the three and nine-month periods ended September 30, 2013 and 2012, and the condensed consolidating statements of cash flows for each of the nine-month periods ended September 30, 2013 and 2012. | | | | | | | | | | | | | | | | | | | | | |
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| • | | Elimination entries necessary to consolidate the parent company and all its subsidiaries. | | | | | | | | | | | | | | | | | | | | | |
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QUALITY DISTRIBUTION, INC. AND SUBSIDIARIES |
Condensed Consolidating Statements of Operations |
and Statements of Comprehensive Income (Loss) |
Three Months Ended September 30, 2013 |
Unaudited—(In 000’s) |
|
| | | | | | | | | | | | | | | | | | | | | | | | |
| | QDI | | | QD LLC and | | | Guarantor | | | Non-Guarantor | | | Eliminations | | | Consolidated | |
QD Capital | Subsidiaries | Subsidiaries |
Operating revenues: | | | | | | | | | | | | | | | | | | | | | | | | |
Transportation | | $ | — | | | $ | — | | | $ | 171,899 | | | $ | — | | | $ | — | | | $ | 171,899 | |
Service revenue | | | — | | | | — | | | | 32,147 | | | | 22 | | | | — | | | | 32,169 | |
Fuel surcharge | | | — | | | | — | | | | 31,603 | | | | — | | | | — | | | | 31,603 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total operating revenues | | | — | | | | — | | | | 235,649 | | | | 22 | | | | — | | | | 235,671 | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | |
Purchased transportation | | | — | | | | — | | | | 153,153 | | | | — | | | | — | | | | 153,153 | |
Compensation | | | — | | | | — | | | | 24,431 | | | | — | | | | — | | | | 24,431 | |
Fuel, supplies and maintenance | | | — | | | | — | | | | 26,212 | | | | — | | | | — | | | | 26,212 | |
Depreciation and amortization | | | — | | | | — | | | | 6,318 | | | | — | | | | — | | | | 6,318 | |
Selling and administrative | | | — | | | | 16 | | | | 8,305 | | | | 10 | | | | — | | | | 8,331 | |
Insurance costs | | | — | | | | — | | | | 4,600 | | | | 7 | | | | — | | | | 4,607 | |
Taxes and licenses | | | — | | | | — | | | | 1,086 | | | | — | | | | — | | | | 1,086 | |
Communication and utilities | | | — | | | | — | | | | 930 | | | | — | | | | — | | | | 930 | |
Gain on disposal of property and equipment | | | — | | | | — | | | | (142 | ) | | | (872 | ) | | | — | | | | (1,014 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
Operating (loss) income | | | — | | | | (16 | ) | | | 10,756 | | | | 877 | | | | — | | | | 11,617 | |
Interest expense (income), non-related party, net | | | — | | | | 7,702 | | | | 255 | | | | (2 | ) | | | — | | | | 7,955 | |
Interest (income) expense, related party, net | | | — | | | | (7,702 | ) | | | 7,784 | | | | (82 | ) | | | — | | | | — | |
Write-off of debt issuance costs | | | — | | | | 521 | | | | — | | | | — | | | | — | | | | 521 | |
Other expense (income), net | | | 476 | | | | — | | | | (548 | ) | | | (30 | ) | | | — | | | | (102 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
(Loss) income before income taxes | | | (476 | ) | | | (537 | ) | | | 3,265 | | | | 991 | | | | — | | | | 3,243 | |
(Benefit from) provision for income taxes | | | (35 | ) | | | — | | | | 336 | | | | 179 | | | | — | | | | 480 | |
Equity in earnings of subsidiaries | | | 3,204 | | | | 3,741 | | | | — | | | | — | | | | (6,945 | ) | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net income | | $ | 2,763 | | | $ | 3,204 | | | $ | 2,929 | | | $ | 812 | | | $ | (6,945 | ) | | $ | 2,763 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total other comprehensive income (loss), net of tax | | | 349 | | | | 349 | | | | 386 | | | | (37 | ) | | | (698 | ) | | | 349 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Comprehensive income | | $ | 3,112 | | | $ | 3,553 | | | $ | 3,315 | | | $ | 775 | | | $ | (7,643 | ) | | $ | 3,112 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
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QUALITY DISTRIBUTION, INC. AND SUBSIDIARIES |
Condensed Consolidating Statements of Operations |
and Statements of Comprehensive Income (Loss) |
Three Months Ended September 30, 2012 |
Unaudited—(In 000’s) |
|
| | | | | | | | | | | | | | | | | | | | | | | | |
| | QDI | | | QD LLC and | | | Guarantor | | | Non-Guarantor | | | Eliminations | | | Consolidated | |
QD Capital | Subsidiaries | Subsidiaries |
Operating revenues: | | | | | | | | | | | | | | | | | | | | | | | | |
Transportation | | $ | — | | | $ | — | | | $ | 160,079 | | | $ | — | | | $ | — | | | $ | 160,079 | |
Service revenue | | | — | | | | — | | | | 31,447 | | | | 103 | | | | — | | | | 31,550 | |
Fuel surcharge | | | — | | | | — | | | | 30,449 | | | | — | | | | — | | | | 30,449 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total operating revenues | | | — | | | | — | | | | 221,975 | | | | 103 | | | | — | | | | 222,078 | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | |
Purchased transportation | | | — | | | | — | | | | 143,036 | | | | — | | | | — | | | | 143,036 | |
Compensation | | | — | | | | — | | | | 22,522 | | | | — | | | | — | | | | 22,522 | |
Fuel, supplies and maintenance | | | — | | | | — | | | | 24,085 | | | | — | | | | — | | | | 24,085 | |
Depreciation and amortization | | | — | | | | — | | | | 6,039 | | | | — | | | | — | | | | 6,039 | |
Selling and administrative | | | — | | | | 8 | | | | 8,228 | | | | 22 | | | | — | | | | 8,258 | |
Insurance costs | | | — | | | | — | | | | 4,374 | | | | — | | | | — | | | | 4,374 | |
Taxes and licenses | | | — | | | | — | | | | 807 | | | | — | | | | — | | | | 807 | |
Communication and utilities | | | — | | | | — | | | | 980 | | | | — | | | | — | | | | 980 | |
Loss on disposal of property and equipment | | | — | | | | — | | | | 360 | | | | — | | | | — | | | | 360 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Operating (loss) income | | | — | | | | (8 | ) | | | 11,544 | | | | 81 | | | | — | | | | 11,617 | |
Interest expense (income), non-related party, net | | | — | | | | 7,232 | | | | 251 | | | | (4 | ) | | | — | | | | 7,479 | |
Interest (income) expense, related party, net | | | — | | | | (7,232 | ) | | | 7,336 | | | | (104 | ) | | | — | | | | — | |
Other income | | | — | | | | — | | | | (45 | ) | | | (67 | ) | | | — | | | | (112 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
(Loss) income before income taxes | | | — | | | | (8 | ) | | | 4,002 | | | | 256 | | | | — | | | | 4,250 | |
(Benefit from) provision for income taxes | | | — | | | | — | | | | (4,651 | ) | | | 38 | | | | — | | | | (4,613 | ) |
Equity in earnings of subsidiaries | | | 8,863 | | | | 8,871 | | | | — | | | | — | | | | (17,734 | ) | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net income | | $ | 8,863 | | | $ | 8,863 | | | $ | 8,653 | | | $ | 218 | | | $ | (17,734 | ) | | $ | 8,863 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total other comprehensive income (loss), net of tax | | | 317 | | | | 317 | | | | 388 | | | | (71 | ) | | | (634 | ) | | | 317 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Comprehensive income | | $ | 9,180 | | | $ | 9,180 | | | $ | 9,041 | | | $ | 147 | | | $ | (18,368 | ) | | $ | 9,180 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
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QUALITY DISTRIBUTION, INC. AND SUBSIDIARIES |
Condensed Consolidating Statements of Operations |
and Statements of Comprehensive Income (Loss) |
Nine Months Ended September 30, 2013 |
Unaudited—(In 000’s) |
|
| | | | | | | | | | | | | | | | | | | | | | | | |
| | QDI | | | QD LLC and | | | Guarantor | | | Non-Guarantor | | | Eliminations | | | Consolidated | |
QD Capital | Subsidiaries | Subsidiaries |
Operating revenues: | | | | | | | | | | | | | | | | | | | | | | | | |
Transportation | | $ | — | | | $ | — | | | $ | 510,540 | | | $ | — | | | $ | — | | | $ | 510,540 | |
Service revenue | | | — | | | | — | | | | 98,180 | | | | 148 | | | | — | | | | 98,328 | |
Fuel surcharge | | | — | | | | — | | | | 95,521 | | | | — | | | | — | | | | 95,521 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total operating revenues | | | — | | | | — | | | | 704,241 | | | | 148 | | | | — | | | | 704,389 | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | |
Purchased transportation | | | — | | | | — | | | | 446,405 | | | | — | | | | — | | | | 446,405 | |
Compensation | | | — | | | | — | | | | 76,402 | | | | — | | | | — | | | | 76,402 | |
Fuel, supplies and maintenance | | | — | | | | — | | | | 79,550 | | | | 8 | | | | — | | | | 79,558 | |
Depreciation and amortization | | | — | | | | — | | | | 19,740 | | | | — | | | | — | | | | 19,740 | |
Selling and administrative | | | — | | | | 148 | | | | 23,781 | | | | 36 | | | | — | | | | 23,965 | |
Insurance costs | | | — | | | | — | | | | 13,454 | | | | 23 | | | | — | | | | 13,477 | |
Taxes and licenses | | | — | | | | — | | | | 3,337 | | | | — | | | | — | | | | 3,337 | |
Communication and utilities | | | — | | | | — | | | | 2,947 | | | | — | | | | — | | | | 2,947 | |
Gain on disposal of property and equipment | | | — | | | | — | | | | (1,590 | ) | | | (922 | ) | | | — | | | | (2,512 | ) |
Impairment charges | | | | | | | | | | | 55,692 | | | | | | | | | | | | 55,692 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Operating (loss) income | | | — | | | | (148 | ) | | | (15,477 | ) | | | 1,003 | | | | — | | | | (14,622 | ) |
Interest expense (income), non-related party, net | | | — | | | | 22,518 | | | | 601 | | | | (2 | ) | | | — | | | | 23,117 | |
Interest (income) expense, related party, net | | | — | | | | (22,518 | ) | | | 22,767 | | | | (249 | ) | | | — | | | | — | |
Write-off of debt issuance costs | | | — | | | | 521 | | | | — | | | | — | | | | — | | | | 521 | |
Other expense (income) | | | 476 | | | | — | | | | (7,884 | ) | | | 63 | | | | — | | | | (7,345 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
(Loss) income before income taxes | | | (476 | ) | | | (669 | ) | | | (30,961 | ) | | | 1,191 | | | | — | | | | (30,915 | ) |
(Benefit from) provision for income taxes | | | (29 | ) | | | — | | | | (11,878 | ) | | | 232 | | | | — | | | | (11,675 | ) |
Equity in loss of subsidiaries | | | (18,793 | ) | | | (18,124 | ) | | | — | | | | — | | | | 36,917 | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net (loss) income | | $ | (19,240 | ) | | $ | (18,793 | ) | | $ | (19,083 | ) | | $ | 959 | | | $ | 36,917 | | | $ | (19,240 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total other comprehensive income, net of tax | | | 1,213 | | | | 1,213 | | | | 1,159 | | | | 54 | | | | (2,426 | ) | | | 1,213 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Comprehensive (loss) income | | $ | (18,027 | ) | | $ | (17,580 | ) | | $ | (17,924 | ) | | $ | 1,013 | | | $ | 34,491 | | | $ | (18,027 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
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QUALITY DISTRIBUTION, INC. AND SUBSIDIARIES |
Condensed Consolidating Statements of Operations |
and Statements of Comprehensive Income (Loss) |
Nine Months Ended September 30, 2012 |
Unaudited—(In 000’s) |
|
| | | | | | | | | | | | | | | | | | | | | | | | |
| | QDI | | | QD LLC and | | | Guarantor | | | Non-Guarantor | | | Eliminations | | | Consolidated | |
QD Capital | Subsidiaries | Subsidiaries |
Operating revenues: | | | | | | | | | | | | | | | | | | | | | | | | |
Transportation | | $ | — | | | $ | — | | | $ | 443,804 | | | $ | — | | | $ | — | | | $ | 443,804 | |
Service revenue | | | — | | | | — | | | | 89,264 | | | | 305 | | | | — | | | | 89,569 | |
Fuel surcharge | | | — | | | | — | | | | 93,353 | | | | — | | | | — | | | | 93,353 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total operating revenues | | | — | | | | — | | | | 626,421 | | | | 305 | | | | — | | | | 626,726 | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | | | |
Purchased transportation | | | — | | | | — | | | | 417,222 | | | | — | | | | — | | | | 417,222 | |
Compensation | | | — | | | | — | | | | 57,669 | | | | — | | | | — | | | | 57,669 | |
Fuel, supplies and maintenance | | | — | | | | — | | | | 56,996 | | | | — | | | | — | | | | 56,996 | |
Depreciation and amortization | | | — | | | | — | | | | 14,452 | | | | — | | | | — | | | | 14,452 | |
Selling and administrative | | | — | | | | 25 | | | | 24,782 | | | | 50 | | | | — | | | | 24,857 | |
Insurance costs | | | — | | | | — | | | | 11,732 | | | | — | | | | — | | | | 11,732 | |
Taxes and licenses | | | — | | | | — | | | | 2,179 | | | | — | | | | — | | | | 2,179 | |
Communication and utilities | | | — | | | | — | | | | 2,724 | | | | — | | | | — | | | | 2,724 | |
Gain on disposal of property and equipment | | | — | | | | — | | | | (4 | ) | | | — | | | | — | | | | (4 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
Operating (loss) income | | | — | | | | (25 | ) | | | 38,669 | | | | 255 | | | | — | | | | 38,899 | |
Interest expense (income), non-related party, net | | | — | | | | 20,959 | | | | 491 | | | | (10 | ) | | | — | | | | 21,440 | |
Interest (income) expense, related party, net | | | — | | | | (20,959 | ) | | | 21,271 | | | | (312 | ) | | | — | | | | — | |
Other income | | | — | | | | — | | | | (218 | ) | | | (58 | ) | | | — | | | | (276 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
(Loss) income before income taxes | | | — | | | | (25 | ) | | | 17,125 | | | | 635 | | | | — | | | | 17,735 | |
(Benefit from) provision for income taxes | | | — | | | | — | | | | (26,741 | ) | | | 109 | | | | — | | | | (26,632 | ) |
Equity in earnings of subsidiaries | | | 44,367 | | | | 44,392 | | | | — | | | | — | | | | (88,759 | ) | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net income | | $ | 44,367 | | | $ | 44,367 | | | $ | 43,866 | | | $ | 526 | | | $ | (88,759 | ) | | $ | 44,367 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total other comprehensive income (loss), net of tax | | | 1,099 | | | | 1,099 | | | | 1,164 | | | | (65 | ) | | | (2,198 | ) | | | 1,099 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Comprehensive income | | $ | 45,466 | | | $ | 45,466 | | | $ | 45,030 | | | $ | 461 | | | $ | (90,957 | ) | | $ | 45,466 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
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QUALITY DISTRIBUTION, INC. AND SUBSIDIARIES |
Condensed Consolidating Balance Sheet |
September 30, 2013 |
Unaudited—(In 000’s) |
|
| | | | | | | | | | | | | | | | | | | | | | | | |
| | QDI | | | QD LLC and | | | Guarantor | | | Non-Guarantor | | | Eliminations | | | Consolidated | |
QD Capital | Subsidiaries | Subsidiaries |
ASSETS | | | | | | | | | | | | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | $ | — | | | $ | — | | | $ | 2,365 | | | $ | 897 | | | $ | — | | | $ | 3,262 | |
Accounts receivable, net | | | — | | | | — | | | | 130,083 | | | | 16 | | | | — | | | | 130,099 | |
Prepaid expenses | | | — | | | | (17 | ) | | | 12,817 | | | | 30 | | | | — | | | | 12,830 | |
Deferred tax asset, net | | | — | | | | — | | | | 20,944 | | | | — | | | | — | | | | 20,944 | |
Intercompany | | | — | | | | — | | | | 395,745 | | | | 108 | | | | (395,853 | ) | | | — | |
Other | | | 50 | | | | — | | | | 10,710 | | | | 2 | | | | — | | | | 10,762 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total current assets | | | 50 | | | | (17 | ) | | | 572,664 | | | | 1,053 | | | | (395,853 | ) | | | 177,897 | |
Property and equipment, net | | | — | | | | — | | | | 170,083 | | | | — | | | | — | | | | 170,083 | |
Assets held-for-sale | | | — | | | | — | | | | 1,848 | | | | — | | | | — | | | | 1,848 | |
Goodwill | | | — | | | | — | | | | 50,553 | | | | — | | | | — | | | | 50,553 | |
Intangibles, net | | | — | | | | — | | | | 35,050 | | | | — | | | | — | | | | 35,050 | |
Non-current deferred tax asset, net | | | (2,270 | ) | | | — | | | | 22,682 | | | | — | | | | — | | | | 20,412 | |
Investment in subsidiaries | | | (103,919 | ) | | | 408,691 | | | | — | | | | — | | | | (304,772 | ) | | | — | |
Intercompany | | | 141,002 | | | | 209,009 | | | | 365,096 | | | | 12,039 | | | | (727,146 | ) | | | — | |
Other assets | | | — | | | | 8,217 | | | | 992 | | | | — | | | | — | | | | 9,209 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total assets | | $ | 34,863 | | | $ | 625,900 | | | $ | 1,218,968 | | | $ | 13,092 | | | $ | (1,427,771 | ) | | $ | 465,052 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
LIABILITIES AND SHAREHOLDERS’ (DEFICIT) EQUITY | | | | | | | | | | | | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | | | | | | | | | | | | |
Current maturities of indebtedness | | $ | — | | | $ | 3,889 | | | $ | 3,335 | | | $ | — | | | $ | — | | | $ | 7,224 | |
Current maturities of capital lease obligations | | | — | | | | — | | | | 1,618 | | | | — | | | | — | | | | 1,618 | |
Accounts payable | | | — | | | | — | | | | 9,834 | | | | (13 | ) | | | — | | | | 9,821 | |
Intercompany | | | 72,715 | | | | — | | | | 323,138 | | | | — | | | | (395,853 | ) | | | — | |
Independent affiliates and independent owner-operators payable | | | — | | | | — | | | | 18,723 | | | | — | | | | — | | | | 18,723 | |
Accrued expenses | | | 286 | | | | 8,831 | | | | 26,756 | | | | 36 | | | | — | | | | 35,909 | |
Environmental liabilities | | | — | | | | — | | | | 4,327 | | | | — | | | | — | | | | 4,327 | |
Accrued loss and damage claims | | | — | | | | — | | | | 7,960 | | | | — | | | | — | | | | 7,960 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total current liabilities | | | 73,001 | | | | 12,720 | | | | 395,691 | | | | 23 | | | | (395,853 | ) | | | 85,582 | |
Long-term indebtedness, less current maturities | | | — | | | | 356,605 | | | | 22,964 | | | | — | | | | — | | | | 379,569 | |
Capital lease obligations, less current maturities | | | — | | | | — | | | | 626 | | | | — | | | | — | | | | 626 | |
Environmental liabilities | | | — | | | | — | | | | 4,675 | | | | — | | | | — | | | | 4,675 | |
Accrued loss and damage claims | | | — | | | | — | | | | 10,143 | | | | — | | | | — | | | | 10,143 | |
Intercompany | | | — | | | | 360,494 | | | | 362,050 | | | | 4,602 | | | | (727,146 | ) | | | — | |
Other non-current liabilities | | | — | | | | — | | | | 22,556 | | | | 39 | | | | — | | | | 22,595 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total liabilities | | | 73,001 | | | | 729,819 | | | | 818,705 | | | | 4,664 | | | | (1,122,999 | ) | | | 503,190 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Shareholders’ (deficit) equity: | | | | | | | | | | | | | | | | | | | | | | | | |
Common stock | | | 440,001 | | | | 354,963 | | | | 390,760 | | | | 4,191 | | | | (749,914 | ) | | | 440,001 | |
Treasury stock | | | (10,329 | ) | | | — | | | | — | | | | — | | | | — | | | | (10,329 | ) |
Accumulated (deficit) retained earnings | | | (247,707 | ) | | | (239,251 | ) | | | 38,547 | | | | 5,315 | | | | 195,389 | | | | (247,707 | ) |
Stock recapitalization | | | (189,589 | ) | | | (189,589 | ) | | | — | | | | (55 | ) | | | 189,644 | | | | (189,589 | ) |
Accumulated other comprehensive loss | | | (30,539 | ) | | | (30,067 | ) | | | (29,044 | ) | | | (1,023 | ) | | | 60,134 | | | | (30,539 | ) |
Stock purchase warrants | | | 25 | | | | 25 | | | | — | | | | — | | | | (25 | ) | | | 25 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total shareholders’ (deficit) equity | | | (38,138 | ) | | | (103,919 | ) | | | 400,263 | | | | 8,428 | | | | (304,772 | ) | | | (38,138 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total liabilities and shareholders’ (deficit) equity | | $ | 34,863 | | | $ | 625,900 | | | $ | 1,218,968 | | | $ | 13,092 | | | $ | (1,427,771 | ) | | $ | 465,052 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
|
QUALITY DISTRIBUTION, INC. AND SUBSIDIARIES |
Condensed Consolidating Balance Sheet |
December 31, 2012 |
Unaudited—(In 000’s) |
|
| | | | | | | | | | | | | | | | | | | | | | | | |
| | QDI | | | QD LLC and | | | Guarantor | | | Non-Guarantor | | | Eliminations | | | Consolidated | |
QD Capital | Subsidiaries | Subsidiaries |
ASSETS | | | | | | | | | | | | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | $ | — | | | $ | — | | | $ | 2,580 | | | $ | 124 | | | $ | — | | | $ | 2,704 | |
Accounts receivable, net | | | — | | | | — | | | | 113,863 | | | | 43 | | | | — | | | | 113,906 | |
Prepaid expenses | | | — | | | | (19 | ) | | | 14,648 | | | | 22 | | | | — | | | | 14,651 | |
Deferred tax asset, net | | | — | | | | — | | | | 16,609 | | | | — | | | | — | | | | 16,609 | |
Intercompany | | | — | | | | — | | | | 369,458 | | | | 88 | | | | (369,546 | ) | | | — | |
Other | | | 44 | | | | — | | | | 9,679 | | | | (29 | ) | | | — | | | | 9,694 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total current assets | | | 44 | | | | (19 | ) | | | 526,837 | | | | 248 | | | | (369,546 | ) | | | 157,564 | |
Property and equipment, net | | | — | | | | — | | | | 190,342 | | | | — | | | | — | | | | 190,342 | |
Goodwill | | | — | | | | — | | | | 104,294 | | | | — | | | | — | | | | 104,294 | |
Intangibles, net | | | — | | | | — | | | | 37,654 | | | | — | | | | — | | | | 37,654 | |
Non-current deferred tax asset, net | | | (2,300 | ) | | | — | | | | 14,013 | | | | — | | | | — | | | | 11,713 | |
Investment in subsidiaries | | | (86,339 | ) | | | 425,602 | | | | — | | | | — | | | | (339,263 | ) | | | — | |
Intercompany | | | 144,738 | | | | 252,732 | | | | 389,289 | | | | 11,582 | | | | (798,341 | ) | | | — | |
Other assets | | | — | | | | 9,510 | | | | 2,526 | | | | — | | | | — | | | | 12,036 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total assets | | $ | 56,143 | | | $ | 687,825 | | | $ | 1,264,955 | | | $ | 11,830 | | | $ | (1,507,150 | ) | | $ | 513,603 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
LIABILITIES AND SHAREHOLDERS’ (DEFICIT) EQUITY | | | | | | | | | | | | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | | | | | | | | | | | | |
Current maturities of indebtedness | | $ | — | | | $ | — | | | $ | 3,918 | | | $ | — | | | $ | — | | | $ | 3,918 | |
Current maturities of capital lease obligations | | | — | | | | — | | | | 3,913 | | | | — | | | | — | | | | 3,913 | |
Accounts payable | | | — | | | | — | | | | 9,977 | | | | (11 | ) | | | — | | | | 9,966 | |
Intercompany | | | 74,583 | | | | — | | | | 294,963 | | | | — | | | | (369,546 | ) | | | — | |
Independent affiliates and independent owner-operators payable | | | — | | | | — | | | | 14,243 | | | | — | | | | — | | | | 14,243 | |
Accrued expenses | | | — | | | | 4,294 | | | | 33,567 | | | | 28 | | | | — | | | | 37,889 | |
Environmental liabilities | | | — | | | | — | | | | 2,739 | | | | — | | | | — | | | | 2,739 | |
Accrued loss and damage claims | | | — | | | | — | | | | 7,326 | | | | — | | | | — | | | | 7,326 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total current liabilities | | | 74,583 | | | | 4,294 | | | | 370,646 | | | | 17 | | | | (369,546 | ) | | | 79,994 | |
Long-term indebtedness, less current maturities | | | — | | | | 384,935 | | | | 23,915 | | | | — | | | | — | | | | 408,850 | |
Capital lease obligations, less current maturities | | | — | | | | — | | | | 2,125 | | | | — | | | | — | | | | 2,125 | |
Environmental liabilities | | | — | | | | — | | | | 6,302 | | | | — | | | | — | | | | 6,302 | |
Accrued loss and damage claims | | | — | | | | — | | | | 9,494 | | | | — | | | | — | | | | 9,494 | |
Intercompany | | | — | | | | 384,935 | | | | 409,053 | | | | 4,353 | | | | (798,341 | ) | | | — | |
Other non-current liabilities | | | — | | | | — | | | | 25,233 | | | | 45 | | | | — | | | | 25,278 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total liabilities | | | 74,583 | | | | 774,164 | | | | 846,768 | | | | 4,415 | | | | (1,167,887 | ) | | | 532,043 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Shareholders’ (deficit) equity: | | | | | | | | | | | | | | | | | | | | | | | | |
Common stock | | | 437,192 | | | | 354,963 | | | | 390,760 | | | | 4,191 | | | | (749,914 | ) | | | 437,192 | |
Treasury stock | | | (5,849 | ) | | | — | | | | — | | | | — | | | | — | | | | (5,849 | ) |
Accumulated (deficit) retained earnings | | | (228,467 | ) | | | (220,458 | ) | | | 57,630 | | | | 4,356 | | | | 158,472 | | | | (228,467 | ) |
Stock recapitalization | | | (189,589 | ) | | | (189,589 | ) | | | — | | | | (55 | ) | | | 189,644 | | | | (189,589 | ) |
Accumulated other comprehensive loss | | | (31,752 | ) | | | (31,280 | ) | | | (30,203 | ) | | | (1,077 | ) | | | 62,560 | | | | (31,752 | ) |
Stock purchase warrants | | | 25 | | | | 25 | | | | — | | | | — | | | | (25 | ) | | | 25 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total shareholders’ (deficit) equity | | | (18,440 | ) | | | (86,339 | ) | | | 418,187 | | | | 7,415 | | | | (339,263 | ) | | | (18,440 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
Total liabilities and shareholders’ (deficit) equity | | $ | 56,143 | | | $ | 687,825 | | | $ | 1,264,955 | | | $ | 11,830 | | | $ | (1,507,150 | ) | | $ | 513,603 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
|
QUALITY DISTRIBUTION, INC. AND SUBSIDIARIES |
Condensed Consolidating Statements of Cash Flows |
Nine Months Ended September 30, 2013 |
Unaudited—(In 000’s) |
|
| | | | | | | | | | | | | | | | | | | | | | | | |
| | QDI | | | QD LLC and | | | Guarantor | | | Non-Guarantor | | | Eliminations | | | Consolidated | |
QD Capital | Subsidiaries | Subsidiaries |
Cash flows from operating activities: | | | | | | | | | | | | | | | | | | | | | | | | |
Net (loss) income | | | (19,240 | ) | | $ | (18,793 | ) | | $ | (19,083 | ) | | $ | 959 | | | $ | 36,917 | | | $ | (19,240 | ) |
Adjustments for non-cash charges | | | 21,307 | | | | (1,907 | ) | | | 75,974 | | | | (1,891 | ) | | | (36,917 | ) | | | 56,566 | |
Net changes in assets and liabilities | | | 309 | | | | 5,828 | | | | (4,100 | ) | | | (12 | ) | | | — | | | | 2,025 | |
Intercompany activity | | | (2,376 | ) | | | 14,872 | | | | (14,213 | ) | | | 1,717 | | | | — | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net cash provided by operating activities | | | — | | | | — | | | | 38,578 | | | | 773 | | | | — | | | | 39,351 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Cash flows from investing activities: | | | | | | | | | | | | | | | | |
Capital expenditures | | | — | | | | — | | | | (19,156 | ) | | | — | | | | — | | | | (19,156 | ) |
Trojan purchase price adjustment | | | — | | | | — | | | | (857 | ) | | | — | | | | — | | | | (857 | ) |
Acquisition of customer list | | | — | | | | — | | | | (1,000 | ) | | | — | | | | — | | | | (1,000 | ) |
Proceeds from sales of property and equipment | | | — | | | | — | | | | 17,981 | | | | — | | | | — | | | | 17,981 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net cash used in investing activities | | | — | | | | — | | | | (3,032 | ) | | | — | | | | — | | | | (3,032 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
Cash flows from financing activities: | | | | | | | | | | | | | | | | | | | | | | | | |
Proceeds from issuance of long-term debt | | | — | | | | 17,500 | | | | — | | | | — | | | | — | | | | 17,500 | |
Principal payments on long-term debt and capital lease obligations | | | — | | | | (22,500 | ) | | | (4,963 | ) | | | — | | | | — | | | | (27,463 | ) |
Proceeds from revolver | | | — | | | | 163,600 | | | | — | | | | — | | | | — | | | | 163,600 | |
Payments on revolver | | | — | | | | (183,300 | ) | | | — | | | | — | | | | — | | | | (183,300 | ) |
Deferred financing costs | | | — | | | | (935 | ) | | | — | | | | — | | | | — | | | | (935 | ) |
Purchases of treasury stock | | | (4,454 | ) | | | | | | | | | | | | | | | | | | | (4,454 | ) |
Proceeds from exercise of stock options | | | 311 | | | | — | | | | — | | | | — | | | | — | | | | 311 | |
Other | | | | | | | — | | | | (1,020 | ) | | | — | | | | — | | | | (1,020 | ) |
Intercompany activity | | | 4,143 | | | | 25,635 | | | | (29,778 | ) | | | — | | | | — | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net cash used in financing activities | | | — | | | | — | | | | (35,761 | ) | | | — | | | | — | | | | (35,761 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net (decrease) increase in cash and cash equivalents | | | — | | | | — | | | | (215 | ) | | | 773 | | | | — | | | | 558 | |
Cash and cash equivalents, beginning of period | | | — | | | | — | | | | 2,580 | | | | 124 | | | | — | | | | 2,704 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents, end of period | | $ | — | | | $ | — | | | $ | 2,365 | | | $ | 897 | | | $ | — | | | $ | 3,262 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
|
QUALITY DISTRIBUTION, INC. AND SUBSIDIARIES |
Condensed Consolidating Statements of Cash Flows |
Nine Months Ended September 30, 2012 |
Unaudited—(In 000’s) |
|
| | | | | | | | | | | | | | | | | | | | | | | | |
| | QDI | | | QD LLC and | | | Guarantor | | | Non-Guarantor | | | Eliminations | | | Consolidated | |
QD Capital | Subsidiaries | Subsidiaries |
Cash flows from operating activities: | | | | | | | | | | | | | | | | | | | | | | | | |
Net income | | $ | 44,367 | | | $ | 44,367 | | | $ | 43,866 | | | $ | 526 | | | $ | (88,759 | ) | | $ | 44,367 | |
Adjustments for non-cash charges | | | (41,993 | ) | | | (63,618 | ) | | | 8,440 | | | | (312 | ) | | | 88,759 | | | | (8,724 | ) |
Net changes in assets and liabilities | | | (77 | ) | | | 6,375 | | | | (33,083 | ) | | | (289 | ) | | | — | | | | (27,074 | ) |
Intercompany activity | | | (2,297 | ) | | | 12,876 | | | | (10,717 | ) | | | 138 | | | | — | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net cash provided by operating activities | | | — | | | | — | | | | 8,506 | | | | 63 | | | | — | | | | 8,569 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Cash flows from investing activities: | | | | | | | | | | | | | | | | | | | | | | | | |
Capital expenditures | | | — | | | | — | | | | (27,423 | ) | | | — | | | | — | | | | (27,423 | ) |
Greensville purchase price adjustment | | | — | | | | — | | | | (66 | ) | | | — | | | | — | | | | (66 | ) |
Acquisition of Trojan | | | — | | | | — | | | | (8,657 | ) | | | — | | | | — | | | | (8,657 | ) |
Acquisition of Bice | | | — | | | | — | | | | (52,176 | ) | | | — | | | | — | | | | (52,176 | ) |
Acquisition of Dunn’s | | | — | | | | — | | | | (34,321 | ) | | | — | | | | — | | | | (34,321 | ) |
Proceeds from sales of property and equipment | | | — | | | | — | | | | 7,453 | | | | — | | | | — | | | | 7,453 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net cash used in investing activities | | | — | | | | — | | | | (115,190 | ) | | | — | | | | — | | | | (115,190 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
Cash flows from financing activities: | | | | | | | | | | | | | | | | | | | | | | | | |
Principal payments on long-term debt and capital lease obligations | | | — | | | | — | | | | (6,335 | ) | | | — | | | | — | | | | (6,335 | ) |
Proceeds from revolver | | | — | | | | 179,400 | | | | — | | | | — | | | | — | | | | 179,400 | |
Payments on revolver | | | — | | | | (99,200 | ) | | | — | | | | — | | | | — | | | | (99,200 | ) |
Deferred financing costs | | | — | | | | (846 | ) | | | — | | | | — | | | | — | | | | (846 | ) |
Proceeds from equity offering, net of transaction costs | | | 30,493 | | | | — | | | | — | | | | — | | | | — | | | | 30,493 | |
Proceeds from exercise of stock options | | | 254 | | | | — | | | | — | | | | — | | | | — | | | | 254 | |
Other | | | — | | | | — | | | | 1,730 | | | | — | | | | — | | | | 1,730 | |
Intercompany activity | | | (30,747 | ) | | | (79,354 | ) | | | 110,101 | | | | — | | | | — | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net cash provided by financing activities | | | — | | | | — | | | | 105,496 | | | | — | | | | — | | | | 105,496 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Net (decrease) increase in cash and cash equivalents | | | — | | | | — | | | | (1,188 | ) | | | 63 | | | | — | | | | (1,125 | ) |
Cash and cash equivalents, beginning of period | | | — | | | | — | | | | 3,540 | | | | 513 | | | | — | | | | 4,053 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents, end of period | | $ | — | | | $ | — | | | $ | 2,352 | | | $ | 576 | | | $ | — | | | $ | 2,928 | |
| | | | | | | | | | | | | | | | | | | | | | | | |