8-KMaterial AgreementsFinancial Events

OLD DOMINION FREIGHT LINE, INC. 8-K Report, Material Agreement (Mar 3, 2005)

Filed March 3, 2005For Securities:ODFL

Summary

Old Dominion Freight Line, Inc. (ODFL) announced on February 25, 2005, the issuance of $50 million in privately-placed Series A Senior Notes, Tranche A, with an additional $25 million, Tranche B, set to be issued on May 25, 2005. These notes carry a fixed interest rate of 4.68% and mature in 2015. The proceeds from the initial issuance were used to refinance existing debt and for general corporate purposes, signaling a strategic move to manage its capital structure. The financing, facilitated by Banc of America Securities, LLC, includes a guarantee from ODIS, Inc., a wholly-owned subsidiary, and allows for potential future private note issuances up to $300 million. The agreement also incorporates customary financial covenants, including limitations on debt incurrence and maintenance of a minimum fixed charge coverage ratio. ODFL also amended its existing credit agreement to accommodate this new debt, demonstrating proactive financial management.

Key Highlights

  • 1Issued $50 million in Series A Senior Notes, Tranche A, with another $25 million planned for May 2005.
  • 2Notes carry a fixed interest rate of 4.68% and mature on February 25, 2015.
  • 3Proceeds used for refinancing existing debt and general corporate purposes.
  • 4Financing includes a guarantee from subsidiary ODIS, Inc.
  • 5Potential for up to $300 million in future private note issuances under the same agreement.
  • 6Agreement includes financial covenants related to debt limits and fixed charge coverage.
  • 7Existing credit agreement amended to permit the incurrence of this new debt.

Frequently Asked Questions

Old Dominion Freight Line, Inc. issued $50 million of Series A Senior Notes, Tranche A on February 25, 2005, and plans to issue an additional $25 million of Series A Senior Notes, Tranche B on May 25, 2005, for a total of $75 million initially.

The Series A Senior Notes have a fixed interest rate of 4.68% per annum and mature on February 25, 2015.

The proceeds from the sale of the Tranche A Notes were used to refinance existing indebtedness and for general corporate purposes.

Yes, the agreement includes financial covenants such as a limitation on incurring new debt unless the consolidated debt to total capitalization ratio does not exceed 60%, a limit on priority debt, and a minimum fixed charge coverage ratio of 1.75 to 1.00. It also includes covenants regarding liens, asset sales, and mergers.