UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
January 31, 2005
CENTRAL FREIGHT LINES, INC.
(Exact name of registrant as specified in its charter)
Nevada 000-50485 74-2914331
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
5601 West Waco Drive, Waco, TX 76710
(Address of principal executive offices) (Zip Code)
(254) 772-2120
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement.
See the information set forth in Item 2.03 of this Current Report on Form
8-K, which is incorporated by reference herein.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
On January 31, 2005, Central Freight Lines, Inc, a Texas corporation and
the operating subsidiary of the registrant (the "Borrower"), entered into a
four-year senior secured revolving credit facility and letter of credit
sub-facility (the "New Credit Facility") with Bank of America, N.A., as Agent,
and certain other lenders from time to time party to the New Credit Facility, in
the aggregate principal amount of up to $70.0 million. The New Credit Facility
replaces both the Borrower's $30.0 million amended and restated revolving credit
facility with SunTrust Bank, originally dated July 28, 2004, and the Borrower's
$40.0 million revolving accounts receivable securitization facility with
SunTrust Bank, originally dated April 30, 2002. The New Credit Facility
terminates on January 31, 2009.
Subject to the terms of the New Credit Facility, the maximum revolving
borrowing limit under the New Credit Facility is the lesser of (a) $70.0
million, or (b) 85% of Borrower's eligible accounts receivable, plus 85% of the
net orderly liquidation value of Borrower's eligible rolling stock owned as of
January 31, 2005, plus 85% of the cost of eligible rolling stock acquired by
Borrower after January 31, 2005. Letters of Credit under the New Credit Facility
are subject to a sub-limit of $40.0 million.
Borrowings under the New Credit Facility bear interest at the base rate, as
defined, plus an applicable margin of 0.00% to 1.00%, or LIBOR plus an
applicable margin of 1.50% to 2.75%, based on the average quarterly availability
under the New Credit Facility. Letters of credit under the New Credit Facility
are subject to an applicable letter of credit margin of 1.25% to 2.50%, based on
the average quarterly availability under the New Credit Facility. The New Credit
Facility also prescribes additional fees for letter of credit transactions, and
an unused line fee of 0.25% to 0.375%, based on aggregate amounts outstanding.
The registrant, as the parent corporation of the Borrower, has guaranteed
the obligations of the Borrower under the New Credit Facility. The New Credit
Facility is secured by substantially all of the Borrower's assets, other than
certain revenue equipment and real estate that is (or may in the future become)
subject to other financing, and by the registrant's pledge of the stock of the
Borrower.
The New Credit Facility contains certain restrictions and covenants
relating to, among other things, fixed charge coverage ratio, cash flow, capital
expenditures, acquisitions and dispositions, sale-leaseback transactions,
additional indebtedness, additional liens, dividends and distributions,
investment transactions, and transactions with affiliates. The New Credit
Facility includes usual and customary events of default for a facility of this
nature and provides that, upon the occurrence and continuation of an event of
default, payment of all amounts payable under the New Credit Facility may be
accelerated, and the lenders' commitments may be terminated.
A copy of the Credit Agreement for the New Credit Facility, and a copy of
the registrant's guaranty of the Borrower's obligations under the New Credit
Facility, are filed as exhibits to this Current Report on Form 8-K.
Item 9.01 Financial Statements and Exhibits.
(a) Financial statement of business acquired.
Not applicable.
(b) Pro forma financial information.
Not applicable.
(c) Exhibits:
EXHIBIT
NUMBER EXHIBIT DESCRIPTION
10.24Credit Agreement dated January 31, 2005, among the Financial
Institutions named Therein as the Lenders, Bank of America, N.A. as
the Agent, and Central Freight Lines, Inc., a Texas corporation, as
the Borrower.
10.25Obligation Guaranty dated January 31, 2005, by Central Freight Lines,
Inc., a Nevada corporation, for the benefit of Bank of America, N.A.,
in its capacity as Agent for the benefit of the Lenders.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CENTRAL FREIGHT LINES, INC.
Date: February __, 2005 By:
--------------------------------------------
Jeff Hale
Senior Vice President and
Chief Financial Officer
EXHIBIT INDEX
EXHIBIT
NUMBER EXHIBIT DESCRIPTION
10.24Credit Agreement dated January 31, 2005, among the Financial
Institutions named Therein as the Lenders, Bank of America, N.A. as
the Agent, and Central Freight Lines, Inc., a Texas corporation, as
the Borrower.
10.25Obligation Guaranty dated January 31, 2005, by Central Freight Lines,
Inc., a Nevada corporation, for the benefit of Bank of America, N.A.,
in its capacity as Agent for the benefit of the Lenders.