AMENDMENT NO. 3
TO CREDIT AGREEMENT
THIS AMENDMENT NO. 3 TO CREDIT AGREEMENT (this "Amendment"), dated and
effective as of the 11th day of June, 2003, is made by and among:
COVENANT ASSET MANAGEMENT, INC., a Nevada corporation (the "Borrower");
COVENANT TRANSPORT, INC., a Nevada corporation and the owner of 100% of the
issued and outstanding common stock of the Borrower (the "Parent");
BANK OF AMERICA, N.A., a national banking association organized and
existing under the laws of the United States, in its capacity as a Lender ("Bank
of America"), and each other financial institution which is a party to the
Credit Agreement (as defined below) and has executed and delivered a signature
page hereto (hereinafter such financial institutions may be referred to
individually as a "Lender" or collectively as the "Lenders"); and
BANK OF AMERICA, N.A., a national banking association organized and
existing under the laws of the United States, in its capacity as agent for the
Lenders (in such capacity, the "Agent").
W I T N E S S E T H:
WHEREAS, the Borrower, the Parent, the Lenders and the Agent are parties to
that certain Credit Agreement dated as of December 13, 2000 (as amended by that
certain Amendment No. 1 to Credit Agreement dated as of August 28, 2001
("Amendment No.1"), and by that certain Amendment No. 2 to Credit Agreement
dated as of February 26, 2003 ("Amendment No. 2"), and as further amended,
restated, supplemented or otherwise modified, the "Credit Agreement"), pursuant
to which the Lenders agreed to make available to the Borrower a revolving credit
facility including (i) a letter of credit subfacility for the issuance of
standby and commercial letters of credit and (ii) a swing line subfacility; and
WHEREAS, the Borrower desires to enter into a proposed trailer transaction
that has been negotiated with Transport International Pool ("TIP"), a subsidiary
of General Electric Capital Corporation (the "TIP Transaction"), that includes
the following: (i) the sale of 2,585 dry van trailers to TIP for approximately
$20.5 million and the subsequental rental of such trailers from TIP until
physical delivery of such trailers to TIP, (ii) the sale and leaseback of 1,266
dry van trailers to TIP for $15.6 million, and (iii) the lease of 3,600 new
trailers from TIP; and the Lenders and Agent desire to permit the TIP
Transaction;
NOW, THEREFORE, in consideration of the mutual covenants and the
fulfillment of the conditions set forth herein, the parties hereto do hereby
agree as follows:
1. Definitions. All capitalized terms used herein without definition shall
have the meanings set forth in the Credit Agreement.
2. Amendment to the Credit Agreement.
(a) Section 10.5(d) of the Credit Agreement is hereby amended and
restated in its entirety to read as follows:
"(d) Transfers of assets necessary to give effect to merger or
consolidation transactions permitted by Section 10.7 or to sale and
leaseback transactions permitted by Section 10.13, and"
(b) Section 2.1(f)(i)(ii) of the Credit Agreement is hereby amended
and restated in its entirety to read as follows:
"(ii) no increase in or added Revolving Credit Commitments
pursuant to this Section 2.1(f) shall result in the Total Revolving
Credit Commitment exceeding $140,000,000,"
3. Waiver and Consent. Subject to the terms and conditions hereof, the
Required Lenders hereby consent to the following:
(a) the Required Lenders hereby waive the requirements of Section
10.13 of the Credit Agreement with respect to the TIP Transaction. This is
a one-time waiver only with respect to the TIP Transaction, and shall in no
way serve to waive any obligations of the Borrower, other than as expressly
set forth above, including but not limited to all future obligations to
comply with Section 10.13 and all other provisions of the Credit Agreement.
4. Conditions to Effectiveness. As a condition to the effectiveness of this
Amendment the Borrower shall cause the following to be delivered to the Agent:
(a) Six (6) original counterparts of this Amendment executed by the
Borrower, the Parent, the Guarantors and each Required Lender;
5. Guarantors. Each of the Guarantors has joined in the execution of this
Amendment for the purpose of consenting to the amendment and to the waiver and
consent contained herein, and reaffirming its guaranty of the Obligations
pursuant to the terms of the Parent Guaranty Agreement and the Subsidiary
Guaranty Agreement.
6. Representations and Warranties. The Borrower and Parent hereby certify
that:
(a) The representations and warranties made by Borrower and Parent in
Article VIII of the Credit Agreement are true on and as of the date hereof
except that (i) the financial statements referred to in Section 8.6 shall
be those most recently furnished to the Agent pursuant to Section 9.1, and
(ii) the proviso at the end of Section 8.1(b) is no longer applicable, as
CTI is now qualified to transact business in the State of Ohio;
(b) There has been no material adverse change in the condition,
financial or otherwise, of the Borrower, the Parent, or their Subsidiaries,
taken as a whole, since the date of the most recent financial reports of
the Parent and its Subsidiaries received by the Agent and each Lender under
Section 9.1 thereof; and
2
(c) No event has occurred and no condition exists which, upon the
consummation of the transaction contemplated hereby, constitutes a Default
or an Event of Default on the part of the Borrower or the Parent under the
Credit Agreement, the Notes or any other Loan Document either immediately
or with the lapse of time or the giving of notice, or both.
7. Entire Agreement. This Amendment, together with Credit Agreement, and
other Loan Documents, sets forth the entire understanding and agreement of the
parties hereto in relation to the subject matter hereof and supersedes any prior
negotiations and agreements among the parties relative to such subject matter.
No promise, condition, representation or warranty, express or implied, not
herein set forth shall bind any party hereto, and not one of them has relied on
any such promise, condition, representation or warranty. Each of the parties
hereto acknowledges that, except as otherwise expressly stated in the Credit
Agreement, and other Loan Documents, no representations, warranties or
commitments, express or implied, have been made by any party to the other. None
of the terms or conditions of this Amendment may be changed, modified, waived or
canceled orally or otherwise, except as permitted pursuant to Section 13.6 of
the Credit Agreement.
8. Full Force and Effect of Agreement. Except as hereby specifically
amended, modified or supplemented, and as previously amended, modified and
supplemented by Amendment No.1 and by Amendment No. 2, the Credit Agreement and
all other Loan Documents are hereby confirmed and ratified in all respects by
each party hereto and shall be and remain in full force and effect according to
their respective terms.
9. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original as against any party
whose signature appears thereon, and all of which shall together constitute one
and the same instrument.
10. Governing Law. This Amendment shall in all respects be governed by, and
construed in accordance with, the laws of the State of Tennessee.
11. Enforceability. Should any one or more of the provisions of this
Amendment be determined to be illegal or unenforceable as to one or more of the
parties hereto, all other provisions nevertheless shall remain effective and
binding on the parties hereto.
12. References. All references in any of the Loan Documents to the "Credit
Agreement" shall mean the Credit Agreement as amended by this Amendment and
Amendment No.1.
13. Successors and Assigns. This Amendment shall be binding upon and inure
to the benefit of the Borrower, the Parent, the Lenders, the Agent and their
respective successors, assigns and legal representatives; provided, however,
that neither the Borrower nor the Parent, without the prior consent of the
Lenders, may assign any rights, powers, duties or obligations hereunder.
14. Expenses. Borrower agrees to pay to the Agent all reasonable
out-of-pocket expenses (including reasonable legal fees and expenses of special
counsel to the Agent) incurred or arising in connection with the negotiation and
preparation of this Amendment.
3
[Remainder of page intentionally left blank.]
4
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their duly authorized officers, all as of the day and year
first above written.
BORROWER:
COVENANT ASSET MANAGEMENT, INC.
By: /s/ Xxxx X. Xxxxx
----------------------------------
Name: Xxxx X. Xxxxx
--------------------------------
Title: Senior VP/CFO
-------------------------------
PARENT:
COVENANT TRANSPORT, INC., a Nevada
corporation
By: /s/ Xxxx X. Xxxxx
----------------------------------
Name: Xxxx X. Xxxxx
--------------------------------
Title: Senior VP/CFO
-------------------------------
GUARANTORS:
COVENANT TRANSPORT, INC., a Nevada
corporation
XXXXXX XXXX TRUCKING CO.
TERMINAL TRUCK BROKER, INC.
XXXXXXXX.XXX, INC.
CIP, INC.
SOUTHERN REFRIGERATED TRANSPORT, INC.
XXXX XXXXX TRUCKING, INC.
COVENANT TRANSPORT, INC., a Tennessee
corporation
By: /s/ Xxxx X. Xxxxx
----------------------------------
Name: Xxxx X. Xxxxx
--------------------------------
Title: Senior VP/CFO
-------------------------------
AMENDMENT NO. 3 TO CREDIT AGREEMENT
Signature Page 1 of 2
AGENT:
BANK OF AMERICA, N.A.
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxx X. Xxxxxxx
------------------------------------------
Title: Agency Officer, Assistant Vice President
-----------------------------------------
LENDERS:
BANK OF AMERICA, N.A.
By: /s/ Xxxx X. Xxxx
--------------------------------------------
Name: Xxxx X. Xxxx
------------------------------------------
Title: Senior Vice President
-----------------------------------------
FLEET NATIONAL BANK
By: /s/ Xxxxxxxxxxx X. Xxxxx
--------------------------------------------
Name: Xxxxxxxxxxx Xxxxx
------------------------------------------
Title: Vice President
-----------------------------------------
SUNTRUST BANK
By: /s/ Xxxxxxx X. Xxxxxxxx
--------------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
------------------------------------------
Title: Director
-----------------------------------------
BRANCH BANKING AND TRUST COMPANY
By: /s/ R. Xxxxxx Xxxx
--------------------------------------------
Name: R. Xxxxxx Xxxx
------------------------------------------
Title: Senior VP
-----------------------------------------
AMENDMENT NO. 3 TO CREDIT AGREEMENT
Signature Page 2 of 2
