ITEM 1.01. Entry into a Material Definitive Agreement.
On November 4, 2022, Schneider National Leasing, Inc. (the “Borrower”), a wholly-owned subsidiary of Schneider National, Inc. (“Schneider”), entered into a $250 million Credit Agreement among the Borrower, Schneider, and certain other subsidiaries of Schneider (as guarantors), the lenders party thereto (the “Lenders”), and JPMorgan Chase Bank, N.A., as administrative agent (the “2022 Credit Facility”) and terminated its existing $250 million Credit Agreement dated as of August 6, 2018 (the “Existing Credit Facility”).
The 2022 Credit Facility matures on November 4, 2027 and allows the Borrower to request an increase in the total commitment by up to $150 million, for a total potential commitment of $400 million. The 2022 Credit Facility also provides a sublimit of $100 million to be used for the issuance of letters of credit. The applicable interest rate under the 2022 Credit Facility is based on (i) the Prime Rate, (ii) the Federal Funds Effective Rate, or (iii) the forward-looking term Secured Overnight Financing Rate (SOFR) published by CME Group Benchmark Administration Limited plus 0.10%, depending upon the specific type of borrowing, plus, in each case, an applicable margin based on the consolidated net debt coverage ratio as of the end of each fiscal quarter.
The 2022 Credit Facility contains representations, warranties, covenants, and events of default substantially similar to the Existing Credit Facility. The covenants contained in the 2022 Credit Facility include required minimum consolidated net worth (subject to termination when the terms of other material debt of Schneider or its subsidiaries does not contain a consolidated net worth covenant), consolidated net debt, limitations on indebtedness, transactions with affiliates, shareholder debt, restricted payments, and upon termination of the consolidated net worth covenant as described above, consolidated interest coverage.
The foregoing description of the 2022 Credit Facility does not purport to be complete and is qualified in its entirety by reference to the full text of the 2022 Credit Facility, which is filed as Exhibit 10.1 to this report, and is incorporated by reference herein.
In the ordinary course of their respective businesses, the Lenders and their affiliates have engaged, and may in the future engage, in commercial banking, investment banking, financial advisory, or other services with the Borrower, Schneider National and its other subsidiaries for which they have in the past or may in the future receive customary compensation and expense reimbursement.
