Accounts Receivable Securitization

6 Months Ended

Jun. 30, 2011

Accounts Receivable Securitization [Abstract]

Accounts Receivable Securitization

Note 8. Accounts Receivable Securitization

On June 8, 2011, Swift Receivables Company II, LLC, a Delaware limited liability company (“SRCII”), a wholly-owned bankruptcy-remote special purpose subsidiary, entered into a receivables sale agreement (the “2011 RSA”) with unrelated financial entities (the “Purchasers”) to replace the Company’s prior accounts receivable sale facility and to sell, on a revolving basis, undivided interests in the Company’s accounts receivable. Pursuant to the 2011 RSA, the Company’s receivable originator subsidiaries will sell all of their eligible accounts receivable to SRCII, which in turn, sells a variable percentage ownership interest in its accounts receivable to the Purchasers. The 2011 RSA provides for up to $275 million initially in borrowing capacity, subject to eligible receivables and reserve requirements, secured by the receivables. The 2011 RSA terminates on June 8, 2014 and is subject to customary fees and contains various customary affirmative and negative covenants, representations and warranties, and default and termination provisions. Outstanding balances under the 2011 RSA accrue program fees generally at commercial paper rates plus 125 basis points and unused capacity is subject to an unused commitment fee of 40 basis points. Pursuant to the 2011 RSA, collections on the underlying receivables by the Company are held for the benefit of SRCII and the Purchasers in the facility and are unavailable to satisfy claims of the Company and its subsidiaries. The facility qualifies for treatment as a secured borrowing under Topic 860, “Transfers and Servicing,” and as such, outstanding amounts are carried on the Company’s balance sheet as a liability with program fees recorded in interest expense.

Additionally, on June 8, 2011, in connection with the entry into the 2011 RSA discussed above, the Company terminated its prior receivables sale agreement, dated as of July 30, 2008 (the “2008 RSA”). The maximum amount available under the 2008 RSA was $210 million and outstanding balances under the 2008 RSA accrued interest at a yield of LIBOR plus 300 basis points or Prime plus 200 basis points, at the Company’s discretion.

For the three and six months ended June 30, 2011, the Company incurred program fee expenses of $1.1 million and $2.4 million, respectively, associated with the 2011 RSA and 2008 RSA, which was recorded in interest expense. For the three and six months ended June 30, 2010, the Company incurred program fee expenses of $1.3 million and $2.4 million, respectively, associated with the 2008 RSA, which was recorded in interest expense. As of June 30, 2011, the outstanding borrowing under the 2011 RSA was $176.0 million against a total available borrowing base of $256.9 million, leaving $80.9 million available.