FOURTH AMENDMENT TO LOAN AGREEMENT
This FOURTH AMENDMENT TO LOAN AGREEMENT (this "Amendment") is made and
entered into as of the 12th day of April, 1999, between NATIONSBANK, N.A., a
national banking association (the "Lender"), and METROTRANS CORPORATION, a
Georgia corporation (the "Borrower").
W I T N E S S E T H :
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WHEREAS, the Lender and the Borrower have entered into that certain Loan
Agreement dated as of September 5, 1997 (as amended to date, the "Loan
Agreement"); and
WHEREAS, certain Events of Default exist under the Loan Agreement and the
other Loan Documents; and
WHEREAS, the Borrower has requested that the Lender waive such Events of
Default and increase the Commitment under the Loan Agreement; and
WHEREAS, in consideration of such waiver and such increase in the
Commitment, the Borrower has agreed to grant to the Lender a lien on and
security interest in all assets, real and personal, of the Borrower.
NOW, THEREFORE, in consideration of the foregoing premises and other good
and valuable consideration, the receipt and legal sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
1. All capitalized terms used herein and not otherwise expressly defined
herein shall have the respective meanings given to such terms in the Loan
Agreement.
2. The Borrower hereby acknowledges that it has failed to comply with
Sections 6.1, 7.9, 7.10 and 7.12 of the Loan Agreement. The Lender waives any
Event of Default arising from such noncompliance with the foregoing provisions
of the Loan Agreement (the "Specified Defaults"). Such waiver shall not apply
to any other Default or Event of Default under the Loan Agreement or any of the
other Loan Documents, whether now existing or hereafter arising, it being
understood that the Lender is hereby retaining all of its rights and remedies
under the Loan Agreement and the other Loan Documents with respect to any
Default or Event of Default other than the Specified Defaults. The Borrower
also acknowledges that such waiver by the Lender has not created and does not
create any course of dealing between the Borrower and the Lender or any
obligation on the part of the Lender with respect to any future restructuring or
modification of the Loan Agreement or any of the other Loan Documents, or any
future or additional fundings or
extensions of credit by the Lender thereunder. Other than the Specified
Defaults, the Lender is aware of no other Events of Default under the Loan
Agreement.
3. The Loan Agreement is hereby amended as follows:
(a) Insert the following definitions of "Account Debtor", "Amended
and Restated Note", "Collateral", "Inventory", "Inventory Value",
"Lockbox", "Lockbox Agreement", "Mortgages", "Pledge Agreement",
"Receivables", "Trademark Assignments", "Security Agreements" and
"Uniform Commercial Code" in SECTION 1.1 in appropriate alphabetical
order as follows:
"Account Debtor" shall mean a Person who is obligated on a
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Receivable.
"Amended and Restated Note" shall mean that certain promissory
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note dated as of April __, 1999 in the original principal amount
of Twenty-Three Million Dollars ($23,000,000) issued to the
Lender by the Borrower, in form and substance acceptable to the
Lender, and any other notes executed and delivered by the
Borrower to the Lender with respect to the Loans, and any
amendments, renewals or extensions of the foregoing.
"Collateral" shall have the meaning ascribed to such term in the
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Security Agreements, and shall include, without limitation, all
Inventory and Receivables of the Borrower and its Subsidiaries,
and all proceeds thereof.
"Inventory" shall mean all inventory of the Borrower and its
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Subsidiaries as such term is defined in the Uniform Commercial
Code and shall include, without limitation, (a) all goods
intended for sale or lease by the Borrower or any of its
Subsidiaries, or for display or demonstration, and other products
intended for sale by the Borrower or any of its Subsidiaries to
its customers, (b) all work in process, (c) all raw materials and
other materials and supplies of every nature and description used
or which might be used in connection with the manufacture,
packing, shipping, advertising, selling, leasing or furnishing of
such goods or otherwise used or consumed in the Borrower's
business, and (d) all documents evidencing and general
intangibles relating to any of the foregoing.
"Inventory Value" shall mean the value of the Inventory of the
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Borrower and its Subsidiaries, calculated in accordance with GAAP
consistently applied.
"Lockbox" shall mean the U.S. Post Office Box established with
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the Lender for the receipt of payments relating to or
constituting proceeds of the Receivables of the Borrower and its
Subsidiaries or of any other Collateral.
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"Lockbox Agreement" shall mean that certain Lockbox Agreement by
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and between the Borrower and the Lender, in form and substance
satisfactory to the Lender, concerning the collection of payments
which represent the proceeds of the Receivables of the Borrower
or any of its Subsidiaries or any other Collateral.
"Mortgages" shall mean any and all of the mortgages, leasehold
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mortgages, deeds of trust, deeds to secure debt, assignments and
other instruments executed and delivered by the Borrower or any
of its Subsidiaries to or for the benefit of the Lender by which
the Lender acquires a Lien on all of the Borrower's or such
Subsidiary's real estate or a collateral assignment of the
Borrower's or any of its Subsidiaries' interest under leases of
real estate, and all amendments, modifications and supplements
thereto.
"Pledge Agreement" shall mean the Stock Pledge Agreement pursuant
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to which the Borrower grants to the Lender a first priority
security interest in all of the capital stock of each Subsidiary
of the Borrower, as the same may be amended, modified or
supplemented from time to time.
"Receivables" shall mean (a) any and all rights to the payment of
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money or other forms of consideration of any kind (whether
classified under the Uniform Commercial Code as accounts,
contract rights, chattel paper, general intangibles, or
otherwise) including, but not limited to, accounts receivable,
letters of credit and the right to receive payment thereunder,
chattel paper, tax refunds, insurance proceeds, contract rights,
notes, drafts, instruments, documents, acceptances, and all other
debts, obligations and liabilities in whatever form from any
Person, (b) all guarantees, security and liens for payment
thereof, (c) all goods, whether now owned or hereafter acquired,
and whether sold, delivered, undelivered, in transit or returned,
which may be represented by, or the sale or lease of which may
have given rise to, any such right to payment or other debt,
obligation or liability, and (d) all proceeds of any of the
foregoing.
"Security Agreements" shall mean those certain Security
-------------------
Agreements by the Borrower and each of its Subsidiaries,
respectively, in favor of the Lender, as the same may be amended,
modified or supplemented from time to time, pursuant to which the
Borrower and each such Subsidiary grant to the Lender a first-
priority Lien on and security interest in all personal property
of the Borrower and each such Subsidiary.
"Trademark Assignments" shall mean those certain Conditional
---------------------
Assignment and Trademark Security Agreements executed by the
Borrower and each of its Subsidiaries, respectively, in favor of
the Lender,
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as the same may be amended, modified or supplemented from time to
time.
"Uniform Commercial Code" shall mean the Uniform Commercial Code
-----------------------
as in effect from time to time in the State of Georgia.
(b) Delete the definitions of "Commitment", "Default Rate", "Maturity
Date", "Note", "Obligations", "Prime Rate Basis", "Restricted Payment"
and "Security Documents" set forth in SECTION 1.1 and replace them
with the following:
"Commitment" shall mean, subject to the mandatory reductions set
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forth in Section 2.5, the obligation of the Lender to make
Advances to, or issue Letters of Credit on behalf of, the
Borrower from time to time, pursuant to the terms hereof in the
aggregate amount outstanding of Twenty-Three Million Dollars
($23,000,000).
"Default Rate" shall mean the rate of interest otherwise in
------------
effect under this Agreement plus three (3) percentage points.
"Maturity Date" shall mean May 31, 2000, or such earlier date as
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payment of the remaining outstanding principal amount of the
Loans or of all remaining outstanding Obligations shall be due
(whether by acceleration or otherwise).
"Obligations" shall mean (a) all payment and performance
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obligations of every kind, nature and description of the
Borrower, its Subsidiaries and any other obligors to the Lender
under this Agreement and the other Loan Documents (including any
interest, fees and other charges on the Loans or otherwise under
the Loan Documents that would accrue but for the filing of a
bankruptcy action with respect to the Borrower or any of its
Subsidiaries or any other such obligor, whether or not such claim
is allowed in such bankruptcy action), as they may be amended
from time to time, or as a result of making the Loans, whether
such obligations are direct or indirect, absolute or contingent,
due or not due, contractual or tortious, liquidated or
unliquidated, arising by operation of law or otherwise, now
existing or hereafter arising; (b) the obligation to pay an
amount equal to the amount of any and all damage which the Lender
may suffer by reason of a breach by the Borrower, any of its
Subsidiaries, or any other obligor, of any obligation, covenant
or undertaking with respect to this Agreement or any other Loan
Document; (c) any obligation to the Lender in respect of the
Letters of Credit; (d) all indebtedness, liabilities,
obligations, covenants and duties of the Borrower or any of its
Subsidiaries to the Lender of any kind, nature and description
arising under or in respect of checking and operating account
relationships between the Borrower or any of its Subsidiaries and
the
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Lender; and (e) all other indebtedness, liabilities, obligations,
covenants and duties of the Borrower or any of its Subsidiaries
to the Lender or any Affiliate of the Lender of any kind, nature
and description.
"Prime Rate Basis" shall mean a simple rate of interest equal to:
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(a) through and including August 31, 1999, (i) with respect to
the first Twenty Million Dollars ($20,000,000) of Obligations
outstanding, the Prime Rate; and (ii) with respect to all
outstanding Obligations in excess of Twenty Million Dollars
($20,000,000), the Prime Rate plus two percent (2%); and (b) from
September 1, 1999 and thereafter, the Prime Rate plus two percent
(2%).
"Restricted Payment" shall mean (a) any direct or indirect
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distribution, dividend, or other payment to any Person on account
of any shares of capital stock or other securities of the
Borrower (other than dividends payable solely in shares of the
Borrower's capital stock), and (b) any payment of management,
consulting or similar fees payable by the Borrower to any Person
who is an Affiliate of the Borrower.
"Security Documents" shall mean the Security Agreements, the
------------------
Mortgages, each Subsidiary Guaranty, the Trademark Assignments,
the Pledge Agreement, all Uniform Commercial Code financing
statements, the Lockbox Agreement, and each other writing
executed and delivered by the Borrower or any other Person
securing the Obligations.
(c) Delete SECTION 2.4 in its entirety.
(d) Delete SECTION 2.5 in its entirety and insert a new SECTION 2.5
as follows:
Section 2.5 Reduction of Commitment.
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(a) On August 18, 1999, November 17, 1999, April 1, 2000, and
May 16, 2000, the Commitment shall automatically reduce in an
amount equal to thirty percent (30%) of the decrease in the
Inventory Value for the Borrower's fiscal quarter most recently
ended from the Inventory Value for the immediately preceding
fiscal quarter. In addition to and without limiting the
foregoing, the Commitment shall automatically reduce to Twenty
Million Dollars ($20,000,000) on December 31, 1999. On each of
the dates set forth in this Section 2.5(a), the Borrower shall
pay the amount necessary to reduce the amount of the Loans
outstanding under the Commitment to not more than the amount of
the Commitment as so reduced, together with accrued interest on
the amounts so repaid.
(b) Without limiting the mandatory reductions set forth in
Section 2.5(a), the Borrower shall have the right, at any time
and from time
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to time prior to the Maturity Date, upon at least thirty (30)
days' prior irrevocable, written notice to the Lender, to cancel
or reduce permanently all or a portion of the Commitment,
provided that any such partial reduction shall be made in
increments of not less than $500,000. As of the date of
cancellation or reduction set forth in such notice, the
Commitment shall be permanently reduced to the amount stated in
the Borrower's notice for all purposes herein, and the Borrower
shall pay the amount necessary to reduce the amount of the Loans
outstanding under the Commitment to not more than the amount of
the Commitment as so reduced, together with accrued interest on
the amounts so prepaid.
(e) Insert a new SECTION 2.9(E) as follows:
(e) The Borrower will cause all moneys, checks, notes, drafts
and other payments relating to or constituting proceeds of
Receivables of the Borrower or any of its Subsidiaries, or of any
other Collateral, to be forwarded to a Lockbox, and in particular
the Borrower will (i) advise each Account Debtor with respect to
sales made on credit to address all remittances with respect to
amounts payable on account of any Receivables to the Lockbox, and
(ii) cause all invoices relating to any such amounts to indicate
that payment is to be made to the Borrower via the Lockbox at
Xxxx Xxxxxx Xxx 000000, Xxxxxxx, Xxxxxxx 00000-0000. So long as
no Event of Default exists and is continuing, the funds on
deposit with the Lender in the Lockbox Account (as such term is
defined in the Lockbox Agreement) shall be subject to the
Borrower's control. Any moneys, checks, notes, drafts or other
payments referred to in this SECTION 2.9(E) which are received by
or on behalf of the Borrower or any of its Subsidiaries will be
held in trust for the Lender and will be delivered to the Lender
as promptly as possible in the exact form received, together with
any necessary endorsements.
(f) Delete SECTION 4.1(R) in its entirety.
(g) Delete the last sentence of SECTION 4.1(U) and replace it with
the following:
All of the tangible personal property of the Borrower and its
Subsidiaries, other than mobile goods, is located as specified in
Schedule 5.
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(h) Insert a new SECTION 4.1(BB) as follows:
(bb) Year 2000 Compliance. The Borrower has (a) initiated a
review and--------------------assessment of all areas within its
and each of its Subsidiaries' business and operations (including
those affected by suppliers, vendors and customers) that could be
adversely affected by the "Year 2000 Problem" (that is, the risk
that computer applications used by the Borrower
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or any of its Subsidiaries (or suppliers, vendors and customers)
may be unable to recognize and perform properly date-sensitive
functions involving certain dates prior to and any date after
December 31, 1999), (b) developed a plan and timeline for
addressing the Year 2000 Problem on a timely basis, and (c) to
date, implemented that plan substantially in accordance with that
timetable. Based on the foregoing, the Borrower believes that all
computer applications (including those of its suppliers, vendors
and customers) that are material to its or any of its
Subsidiaries' business and operations are reasonably expected on
a timely basis to be able to perform properly date-sensitive
functions for all dates before and after January 1, 2000 (that
is, be "Year 2000 compliant").
(i) Delete SECTION 5.7 in its entirety and insert a new SECTION 5.7
as follows:
Section 5.7 Visits and Inspections. The Lender (by any of
----------------------
its officers, employees or agents) shall have the right at any
time or times to (a) visit the properties of the Borrower and its
Subsidiaries, inspect the Collateral and the other assets of the
Borrower and its Subsidiaries and inspect and make extracts from
the books and records of the Borrower and its Subsidiaries,
including, but not limited to, management letters prepared by
independent accountants, all during customary business hours at
such premises, (b) discuss the Borrower's business, assets,
liabilities, financial condition, results of operations and
business prospects, insofar as the same are reasonably related to
the rights of the Lender hereunder or under any of the Loan
Documents, with the Borrower's and its Subsidiaries' (i)
principal officers, (ii) independent accountants and other
professionals providing services to the Borrower or any of its
Subsidiaries, and (iii) any other Person (except that any such
discussion with any third parties shall be conducted only in
accordance with the Lender's standard operating procedures
relating to the maintenance of confidentiality of confidential
information of borrowers), and (c) verify the amount, quantity,
value and condition of, or any other matter relating to, any of
the Collateral and in this connection to review, audit and make
extracts from all records and files related to any of the
Collateral. The Borrower and each of its Subsidiaries will
deliver to the Lender any instrument necessary to authorize an
independent accountant or other professional to have discussions
of the type outlined above with the Lender or for the Lender to
obtain records from any service bureau maintaining records on
behalf of the Borrower or any of its Subsidiaries.
(j) Insert a new SECTION 5.17 and a new SECTION 5.18 as follows:
Section 5.17 Year 2000 Compliance. The Borrower will
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promptly notify the Lender in the event the Borrower discovers or
determines that any computer application (including those of its
suppliers,
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vendors and customers) that is material to its or any of its
Subsidiaries' business and operations will not be Year 2000
compliant (as defined in Section 4.1(bb)).
Section 5.18 Certificates of Title. Promptly upon request
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by the Lender, and in any event within five (5) Business Days
after any such request, the Borrower will, and will cause its
Subsidiaries to, provide to the Lender all certificates of title
and certificates of origin with respect to any vehicles or other
Collateral for which such certificates exist and take all steps
requested by the Lender to have the Lender's Lien noted thereon.
(k) Delete SECTION 6.3 in its entirety and replace it with the
following:
Section 6.3 Performance Certificates. At the time the financial
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statements are furnished pursuant to Sections 6.1, 6.2 and 6.8, a
certificate of the president or chief financial officer of the
Borrower as to its financial performance:
(a) setting forth as and at the end of the applicable
period the arithmetical calculations required to establish
whether or not the Borrower was in compliance with the
requirements of Section 7.9; and
(b) stating that no Default or Event of Default has
occurred as at the end of such period, or, if a Default or Event
of Default has occurred, whether it is continuing and the steps
being taken by the Borrower with respect to such Default or Event
of Default.
(l) Insert the following sentence at the end of SECTION 6.5(A):
In addition to and without limiting the foregoing, the Borrower
shall promptly inform the Lender in writing of all material
developments with respect to any such proceedings, investigations
and actions, including, but not limited to, any action,
litigation or dispute between the Borrower and Mayflower.
(m) Insert a new SECTION 6.7 and a new SECTION 6.8 as follows:
Section 6.7 Weekly Financial Statements and Information. In
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addition to the annual, quarterly and monthly financial
statements provided for in Sections 6.1, 6.2 and 6.8,
respectively, not later than the third Business Day of any
calendar week, the following financial information, in each case
on a consolidated and consolidating basis with its Subsidiaries:
(a) a thirteen-week rolling cash flow projection, (b) an accounts
payable aging, (c) an accounts receivable aging, and (d) a
schedule of Inventory. Such
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schedule of Inventory shall include as much of the Inventory of
the Borrower and its Subsidiaries as the Borrower can reasonably
provide, and in any event shall include the following: (v) all
new finished bus Inventory located in Griffin, Georgia; (w) all
buses used as demonstrator models; (x) all bus Inventory of Bus
Pro, Inc.; (y) all Irizar Inventory; and (z) the number of buses
that then constitute work-in-process Inventory, sorted by those
in the raw body, painting, and finishing stages. The Borrower
shall deliver schedules of parts and raw materials Inventory as
often as is reasonably feasible, but in any event, Borrower shall
deliver such information along with the quarterly financial
statements provided for in Section 6.2.
Section 6.8 Monthly Financial Statements and Information.
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In addition to the annual, monthly and weekly financial
information provided for in Sections 6.1, 6.2 and 6.7,
respectively, within fifteen (15) days after the last day of each
calendar month, beginning with the calendar month of October,
1999, the balance sheets of the Borrower on a consolidated and
consolidating basis with its Subsidiaries, as at the end of such
calendar month and as of the end of the preceding fiscal year,
and the related statements of cash flows of the Borrower on a
consolidated and consolidating basis with its Subsidiaries, for
such calendar month and for the elapsed portion of the year ended
with the last day of such calendar month, which shall set forth
in comparative form such figures as at the end of and for such
calendar month and appropriate prior calendar period, shall
provide consolidated and consolidating figures with respect to
Acquisitions consummated during such calendar period, and shall
be certified by the chief financial officer of the Borrower to
have been prepared in accordance with GAAP and to present fairly
in all material respects the financial position of the Borrower
on a consolidated and consolidating basis with its Subsidiaries,
as at the end of such calendar month, and the results of
operations for such calendar month, and for the elapsed portion
of the year ended on the last day of such calendar month, subject
only to normal year-end and audit adjustments.
(n) Delete SECTION 7.1(I) in its entirety and replace it with the
following:
(i) Indebtedness under deferred compensation plans in an
aggregate principal amount outstanding at any time not to exceed
the amount outstanding as of March 31, 1999;
(o) Delete SECTION 7.4(A) in its entirety and replace it with the
following:
(a) Disposition of Assets. The Borrower shall not, and
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shall not permit any of its Subsidiaries to, at any time sell,
lease, abandon, transfer, assign, swap, or otherwise dispose of
any asset without the prior written
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consent of the Lender other than (i) sales of Inventory in the
ordinary course of business; (ii) obsolete or immaterial assets
disposed of in the ordinary course of business; (iii)
dispositions by the Borrower to a Subsidiary or between two (2)
Subsidiaries (so long as any such Subsidiary has executed a
Subsidiary Guaranty, a Security Agreement, a Trademark Assignment
and such other documentation as the Lender may reasonably request
to create and perfect the Lender's first-priority Lien on and
Security Interest in the assets of such Subsidiary); (iv)
dispositions of Inventory owned by Bus Pro, Inc. as of April __,
1999; (v) Inventory consisting of demonstrator models owned by
the Borrower or any of its Subsidiaries as of April ___, 1999;
and (vi) other dispositions by the Borrower and its Subsidiaries
in an aggregate amount not to exceed $250,000 in any fiscal year.
(p) Insert the following new SECTION 7.5(D):
or (d) any Guaranty of the Obligations by any Subsidiary of the
Borrower.
(q) Delete SECTIONS 7.8, 7.9, 7.10, 7.11 and 7.12 in their entirety
and replace them with the following:
Section 7.8 Restricted Payments and Purchases. The
---------------------------------
Borrower shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly declare or make any Restricted Payment
or Restricted Purchase, or set aside any funds for any such
purpose, except that any of the Borrower's wholly-owned
Subsidiaries may pay dividends solely to the Borrower.
Section 7.9 Financial Ratios
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(a) Minimum Tangible Net Worth. The Borrower shall not
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permit its Tangible Net Worth, as of the fiscal quarters ending
July 4, 1999 and October 3, 1999, and as of any fiscal month
end thereafter, to be less than (i) the Borrower's Tangible Net
Worth as of April 4, 1999, minus (ii) $500,000. For purposes of
this Section 7.9(a), Tangible Net Worth shall be calculated by
adding back to net income for the applicable period (i) any fees
or costs actually paid or outstanding under Section 10. of this
Agreement and (ii) professional fees actually paid or
outstanding, but not to exceed: (A) $650,000 for the Borrower's
second fiscal quarter of its 1999 fiscal year; and (B) $500,000
for each fiscal quarter thereafter. For purposes of this Section
7.9, the term "professional fees" shall mean and include fees
incurred by the Borrower or any of its Subsidiaries to attorneys,
accountants, consultants or other professionals in a similar
capacity, but shall not include any fees or costs owed to the
Lender by the Borrower under Section 10. of this Agreement.
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(b) Maximum Inventory. The Borrower shall not permit the
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Inventory Value, as of the fiscal quarters ending July 4, 1999
and October 3, 1999, and as of any calendar month end thereafter,
to be greater than (A) the Inventory Value as of April 4, 1999,
plus (B) $250,000.
(c) Minimum Net Income. The Borrower shall not permit its
------------------
Net Income, as of the fiscal quarter ending July 4, 1999 and as
of any fiscal quarter end thereafter, to be less than negative
$500,000 for any such fiscal quarter. For purposes of this
Section 7.9(c), Net Income shall be calculated by adding back to
net income for the applicable period (i) any fees or costs
actually paid or outstanding under Section 10 of this Agreement
and (ii) professional fees actually paid or outstanding, but not
to exceed: (A) $650,000 for Borrower's second fiscal quarter of
its 1999 fiscal year, and (B) $500,000 for each fiscal quarter
thereafter.
Section 7.10 Capital Expenditures. The Borrower and its
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Subsidiaries shall not make or incur Capital Expenditures in
excess of $500,000, in the aggregate, in any calendar year.
(r) Delete SECTION 8.1(B) in its entirety and replace it with the
following:
(b) The Borrower shall default in the payment of (i) any
interest under any of the Notes or fees or other amounts payable
to the Lender under any of the Loan Documents, or any of them,
when due, and such default shall be unremedied for ten (10) days,
or (ii) any principal under the Notes when due; or
(s) Delete SECTION 8.1(E) in its entirety and replace it with the
following:
(e) There shall occur any default in the performance or
observance of any agreement or covenant or breach of any
representation or warranty contained in any of the Loan Documents
(other than this Agreement or as otherwise provided in Section
8.1 of this Agreement) by the Borrower, any of its Subsidiaries,
or any other obligor thereunder, which shall not be cured within
a period of thirty (30) days from the occurrence of such default
(without duplication of any cure period contained in any such
Loan Document); provided, however, that such thirty-day cure
period shall not apply to any default or breach (i) of Section 5
of any Security Agreement; (ii) that constitutes a material
violation of the Lockbox Agreement; (iii) of Section 5 of any
Trademark Assignment; or (iv) of Section 6 of the Pledge
Agreement.
(t) Delete SECTION 8.1(K) in its entirety and replace it with the
following:
(k) There shall occur (i) any default under any other
document, instrument or agreement, other than any of the
Mayflower Subordinated Loan Documents, relating to any
Indebtedness of the Borrower or any of the Borrower's
Subsidiaries having an aggregate principal amount exceeding
$500,000; or (ii) any event which directly or indirectly causes
the Borrower
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or any of its Subsidiaries to be required to offer to prepay any
Indebtedness, except for the Mayflower Subordinated Debt, or
which directly or indirectly gives any holder of any
Indebtedness, other than the Mayflower Subordinated Debt, of the
Borrower or any of its Subsidiaries the right to require the
Borrower or any of its Subsidiaries to prepay any such
Indebtedness under any other document, instrument or agreement
relating to any Indebtedness of the Borrower or any of the
Borrower's Subsidiaries having an aggregate principal amount
exceeding $500,000, other than the Mayflower Subordinated Loan
Documents; or (iii) any default under any Interest Rate Hedge
Agreement having a notional principal amount of $250,000 or more;
or
(u) Insert new SECTIONS 8.1(N), (O), (P), (Q) and (R) as follows:
(n) Any of the Pledged Collateral (as such term is defined
in the Pledge Agreement) shall be attached or levied upon or
seized in any legal proceedings, or held by virtue of any Lien or
distress;
(o) There shall occur any termination or withdrawal of any
Guaranty of any of the Obligations; or
(p) Any third party shall seize any of the Collateral with
an aggregate fair market value of $50,000 or more;
(q) Xxxx Xxxxxx shall cease to be an officer of the
Borrower and be involved in the day-to-day management of the
Borrower, and a replacement reasonably satisfactory to the Lender
shall not be appointed within thirty (30) days; provided,
however, that any individual with qualifications which are
reasonably similar to the qualifications of chief executive
officers of similarly situated companies shall be deemed to be
satisfactory to the Lender;
(r) The Borrower shall cease to employ Xxxxxx Xxxxxxxx &
Co. (or one of its Affiliates) as a turnaround or crisis-
management consultant, and a replacement consulting firm
reasonably satisfactory to the Lender shall not be employed
within thirty (30) days; provided, however, that a replacement
consulting firm shall be deemed to be satisfactory to the Lender
if its qualifications with respect to turnarounds and crisis
management are reasonably similar to those of Xxxxxx Xxxxxxxx &
Co.
(v) Delete SECTION 10.13 and replace it with the following:
Section 10.13 Arbitration.
-----------
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(a) EXCEPT AS SET OUT BELOW, ANY CONTROVERSY OR CLAIM
BETWEEN OR AMONG THE PARTIES HERETO INCLUDING BUT NOT LIMITED TO
THOSE ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY RELATED
DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN
ALLEGED TORT (COLLECTIVELY, "CLAIM"), SHALL BE DETERMINED BY
BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION
ACT (OR IF NOT APPLICABLE, THE APPLICABLE STATE LAW), THE RULES
OF PRACTICE AND PROCEDURE FOR THE ARBITRATION OF COMMERCIAL
DISPUTES OF J.A.M.S./ENDISPUTE OR ANY SUCCESSOR THEREOF
("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW. IN THE
EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL.
JUDGMENT UPON ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT
HAVING JURISDICTION. ANY PARTY TO THIS AGREEMENT MAY BRING AN
ACTION, INCLUDING A SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL
ARBITRATION OF ANY CLAIM IN ANY COURT HAVING JURISDICTION OVER
SUCH ACTION. THE INSTITUTION AND MAINTENANCE OF AN ACTION FOR ANY
JUDICIAL RELIEF SHALL NOT CONSTITUTE A WAIVER OF THE RIGHT OF ANY
PARTY, INCLUDING THE PLAINTIFF, TO SUBMIT THE CLAIM TO
ARBITRATION IF ANY OTHER PARTY CONTESTS SUCH ACTION FOR JUDICIAL
RELIEF.
(b) SPECIAL RULES. ANY ARBITRATION SHALL BE CONDUCTED IN
-------------
THE COUNTY OF THE BORROWER'S DOMICILE AT THE TIME OF THE
EXECUTION OF THIS AGREEMENT, OR IF THERE IS REAL OR PERSONAL
PROPERTY COLLATERAL, IN THE COUNTY WHERE SUCH REAL OR PERSONAL
PROPERTY IS LOCATED, AND ADMINISTERED BY J.A.M.S., WHO WILL
APPOINT AN ARBITRATOR; IF J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED
FROM ADMINISTERING THE ARBITRATION, THEN THE AMERICAN ARBITRATION
ASSOCIATION WILL SERVE. ALL ARBITRATION HEARINGS WILL BE
COMMENCED WITHIN 90 DAYS OF THE DEMAND FOR ARBITRATION; FURTHER,
THE ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE PERMITTED
TO EXTEND THE COMMENCEMENT OF SUCH HEARING FOR UP TO AN
ADDITIONAL 60 DAYS. ANY DISPUTE CONCERNING THIS ARBITRATION
PROVISION OR WHETHER A CLAIM IS
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ARBITRABLE SHALL BE DETERMINED BY THE ARBITRATOR. THE ARBITRATOR
SHALL HAVE THE POWER TO AWARD LEGAL FEES PURSUANT TO THE TERMS OF
THIS AGREEMENT.
(c) RESERVATION OF RIGHTS. NOTHING IN THIS SECTION 10.13
---------------------
SHALL BE DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE
APPLICABLE STATUTES OF LIMITATION OR REPOSE AND ANY WAIVERS
CONTAINED IN THIS AGREEMENT; OR (II) BE A WAIVER BY THE LENDER OF
THE PROTECTION AFFORDED TO IT BY 12 U.S.C. SEC. 91 OR ANY
SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE RIGHT OF
ANY PARTY HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT
NOT LIMITED TO) SETOFF, OR (B) TO FORECLOSE AGAINST OR SELL ANY
REAL OR PERSONAL PROPERTY COLLATERAL, OR (C) TO OBTAIN FROM A
COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH AS (BUT NOT LIMITED
TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT OF A
RECEIVER. ANY PARTY MAY EXERCISE SUCH SELF HELP RIGHTS,
FORECLOSE OR SELL COLLATERAL OR OBTAIN SUCH PROVISIONAL OR
ANCILLARY REMEDIES BEFORE, DURING OR AFTER THE PENDENCY OF ANY
ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS AGREEMENT. NONE
OF THESE ACTIONS SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY
PARTY, INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE
THE MERITS OF THE CLAIM OCCASIONING RESORT TO SUCH REMEDIES OR
PROCEDURES.
(d) WAIVER OF CERTAIN DAMAGES. THE PARTIES HERETO WAIVE ANY
-------------------------
RIGHT OR REMEDY EITHER MAY HAVE AGAINST THE OTHER TO RECOVER
PUNITIVE OR EXEMPLARY DAMAGES ARISING OUT OF ANY CLAIM WHETHER
THE CLAIM IS RESOLVED BY ARBITRATION OR BY JUDICIAL ACTION.
(w) Delete each of the Schedules to the Loan Agreement and replace
them with the Schedules attached hereto.
4. The effectiveness of this Amendment is expressly conditioned upon the
execution and/or delivery by the Borrower of the following documents, each of
which shall be acceptable to the Lender and its counsel in form and substance:
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(a) this Amendment;
(b) the Amended and Restated Note;
(c) the Security Agreements;
(d) the Mortgages, together with all other instruments, certificates,
affidavits and other documents requested by the Lender in connection therewith;
(e) the Pledge Agreement, together with all original stock
certificates of each Subsidiary of the Borrower and blank stock powers for each
such Subsidiary;
(f) the Trademark Assignments;
(g) the Lockbox Agreement;
(h) Uniform Commercial Code financing statements naming the Borrower
and each of its Subsidiaries as debtor and the Lender as secured party for
filling in each jurisdiction which the Lender deems necessary or appropriate in
its sole discretion;
(i) certificates or binders of insurance relating to each of the
policies of insurance covering any of the Collateral, together with loss payable
clauses naming the Lender as an additional insured and loss payee as its
interests may appear, and providing that (i) all proceeds thereunder shall be
payable to the Lender, (ii) no such insurance shall be affected by any act or
neglect of the insured or owner of the property described in such policy, and
(iii) such policy and loss payable clauses may not be canceled, amended or
terminated unless at least 30 days' prior written notice is given to the Lender;
(j) a signed opinion of legal counsel to the Borrower and its
Subsidiaries opining as to such matters in connection with this Amendment as the
Lender or its counsel may reasonably request;
(k) landlord's waiver and consent agreements duly executed on behalf
of each landlord of real property on which any Collateral is located; and
(l) certified copies of the articles of incorporation and by-laws of
the Borrower and each of its Subsidiaries as in effect on the date of this
Amendment;
(m) certified copies of all corporate action, including stockholder
approval, if necessary, taken by the Borrower and its Subsidiaries to authorize
the execution, delivery and performance of this Agreement and the other Loan
Documents and the borrowings under this Agreement;
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(n) certificates of incumbency and specimen signatures with respect to
each of the officers of the Borrower and its Subsidiaries who is authorized
to execute and deliver this Agreement or any other Loan Document on behalf
of the Borrower or any Subsidiary or any document, certificate or
instrument to be delivered in connection with this Agreement or the other
Loan Documents and to request borrowings under this Agreement;
(o) such other documents, instruments, certificates or agreements as
the Lender or its counsel may reasonably request.
5. The Borrower hereby covenants and agrees that, until the Obligations
have been indefeasibly paid in full and the Commitment has been terminated, it
will not make any payments on or with respect to the Mayflower Subordinated
Debt, whether principal, interest or otherwise, and any such payment made by the
Borrower shall constitute an Event of Default under the Loan Agreement, each
Security Document and all other Loan Documents.
6. The Borrower hereby acknowledges and agrees that the Borrower shall
have no right to request LIBOR Advances under the Loan Agreement, and any
currently outstanding LIBOR Advances may not be renewed or reborrowed as LIBOR
Advances. Additionally, the Borrower agrees that, notwithstanding anything to
the contrary contained in the Loan Agreement, the Note or any other Loan
Document, interest on all presently outstanding LIBOR Advances shall be due and
payable on April 12, 1999 and on the first day of each calendar month,
commencing May 1, 1999. Further, any LIBOR Advances outstanding as of the date
of this Amendment shall, as of the date of this Amendment, bear interest at the
Prime Rate Basis rather than the LIBOR Basis and shall, for all purposes under
the Loan Agreement, the Note and the other Loan Documents, be deemed to be Prime
Rate Advances.
7. The Borrower hereby restates, ratifies, and reaffirms each and every
term, condition, representation and warranty heretofore made by it under or in
connection with the execution and delivery of the Loan Agreement, as amended
hereby, and the other Loan Documents, as fully as though such representations
and warranties had been made on the date hereof and with specific reference to
this Amendment and the Loan Documents.
8. Except as expressly set forth herein, the Loan Agreement and the other
Loan Documents shall be and remain in full force and effect as originally
written, and shall constitute the legal, valid, binding and enforceable
obligations of the Borrower to the Lender.
9. The Borrower acknowledges and agrees that, solely as an accommodation
to the Borrower and at the Borrower's request, this Amendment has been executed
on an expedited basis and prior to the completion of due diligence by the Lender
and its counsel. Accordingly, the Borrower acknowledges that the Lender will
conduct such lien searches, title searches and other investigations and due
diligence which the Lender deems necessary or appropriate in its sole
discretion, and that the Borrower, its Subsidiaries, its directors, officers and
other employees will cooperate fully with the Lender and its counsel to complete
such due diligence. Further, the Borrower and such Subsidiaries will, beginning
within five (5) Business Days (and continuing
-16-
diligently thereafter) following the Lender's request, take any action necessary
to resolve any issues discovered during such due diligence to the Lender's
reasonable satisfaction, including, without limitation, taking any action and
executing any documents necessary to create, establish and perfect the Lender's
first-priority Security Interest in all assets, real and personal, of the
Borrower and its Subsidiaries. Any failure by the Borrower or any of its
Subsidiaries to comply with the terms of this paragraph shall constitute an
Event of Default under the Loan Agreement, the Security Documents and the other
Loan Documents.
10. The Borrower agrees to pay on demand all reasonable costs and expenses
of the Lender in connection with the preparation, execution, delivery and
enforcement of this Amendment and all other Loan Documents and any other
transactions contemplated hereby, including, without limitation, the fees and
out-of-pocket expenses of legal counsel to the Lender.
11. To induce the Lender to enter into this Amendment, the Borrower hereby
(a) represents and warrants that, as of the date hereof, and after giving effect
to the terms hereof, there exists no Default or Event of Default under the Loan
Agreement or any of the other Loan Documents, and (b) acknowledges and agrees
that no right of offset, defense, counterclaim, claim or objection in favor of
the Borrower against the Lender exists arising out of or with respect to any of
the Obligations.
12. As a further material inducement to the Lender to enter into this
Amendment, to make additional Loans to the Borrower and to grant concessions to
the Borrower, all in accordance with and subject to the terms and conditions of
this Amendment, all of which are to the direct advantage and benefit of the
Borrower and its Subsidiaries, the Borrower, together with all of its successors
and assigns:
(a) does hereby remise, release, acquit, satisfy and forever
discharge the Lender, and all of the respective past, present and future
officers, directors, employees, agents, attorneys, representatives,
participants, heirs, successors and assigns of the Lender from any and all
manner of debts, accountings, bonds, warranties, representations,
covenants, promises, contracts, controversies, agreements, liabilities,
obligations, expenses, damages, judgments, executions, actions, claims,
demands and causes of action of any nature whatsoever, whether at law or in
equity, either now accrued or hereafter maturing or whether known or
unknown, which the Borrower now has or hereafter can, shall or may have by
reason of any manner, cause or things, from the beginning of the world to
and including the date of this Amendment, including specifically, but
without limitation, matters arising out of, in connection with or related
to:
(i) any and all obligations owed or owing to the Lender under any
document evidencing financial arrangements by, among and between the
Lender and the Borrower, including the Loan Agreement, and including,
but not limited to, the administration or funding thereof;
-17-
(ii) the Loan Agreement, the Security Documents and all
other Loan Documents, and the Indebtedness evidenced and secured
thereby; or
(iii) any other agreement or transaction between the Borrower
and the Lender or any Subsidiary or Affiliate of Lender;
(b) does hereby covenant and agree never to institute or cause to be
instituted or continued prosecution of any suit or other form of action or
proceeding of any kind or nature whatsoever against the Lender or any
Subsidiaries or Affiliates of the Lender or any of their respective past,
present or future officers, directors, employees, agents, attorneys,
representatives, participants, heirs, successors or assigns, by reason of
or in connection with any of the foregoing matters, claims or causes of
action; provided, however, that the foregoing release and covenant not to
xxx shall not apply to any claims arising after the date of this Amendment
with respect to acts, occurrences or events after the date of this
Amendment; and
(c) expressly acknowledges and agrees that the waivers, estoppels and
releases in favor of the Lender contained in this Amendment shall not be
construed as an admission of any wrongdoing, liability or culpability on
the part of the Lender or as any admission by the Lender of the existence
of claims by the Borrower against the Lender. The Borrower further
acknowledges and agrees that, to the extent any such claims exist, they are
of a speculative nature so as to be incapable of objective evaluation and
that, to the extent that any such claims may exist and may have value, such
value would constitute primarily "nuisance" value or "leverage" value in
adversarial proceedings between the Borrower and the Lender. In any event,
the Borrower and the Lender, and each of them, acknowledge and agree that
the value to the Borrower of the covenants and agreements on the part of
the Lender contained in this Amendment substantially and materially exceed
any and all value of any kind or nature whatsoever of any claims or other
liabilities waived or released by the Borrower.
13. The Borrower represents and warrants that: (a) the Borrower has no
present intent to file any voluntary petition under any chapter of the
Bankruptcy Code, Title 11, U.S.C. ("Bankruptcy Code"), or in any manner to seek
any relief under any other state, federal, or insolvency laws or laws providing
for relief of debtors, or directly or indirectly to cause others to file such
petition or to seek any such relief, either at the present time or at any time
hereafter; (b) the Borrower has no present intent to directly or indirectly
cause any involuntary petition under any chapter of the Bankruptcy Code to be
filed against the Borrower or directly or indirectly cause the Borrower to
become the subject of any proceeding pursuant to any other state, federal or
other insolvency law or laws providing for the relief of debtors, either at the
present time or at any time hereafter; and (c) the Borrower has no present
intent to directly or indirectly cause the property of the Borrower to become
the property of any bankrupt estate or the subject of any state, federal or
other bankruptcy, dissolution, liquidation, or insolvency proceedings, either at
the present time or at any time hereafter.
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14. The Borrower agrees to take such further action as the Lender shall
reasonably request in connection herewith to evidence the amendments herein
contained to the Loan Agreement and the other Loan Documents.
15. This Amendment may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which, when so
executed and delivered, shall be deemed to be an original and all of which
counterparts, taken together, shall constitute but one and the same instrument.
16. This Amendment shall be binding upon and inure to the benefit of the
successors and permitted assigns of the parties hereto.
17. This Amendment shall be governed by, and construed in accordance with,
the laws of the State of Georgia.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the Borrower and the Lender have caused this Amendment
to be duly executed under seal, all as of the date first above written.
METROTRANS CORPORATION
By:_______________________________
Name:___________________________
Title:__________________________
[CORPORATE SEAL]
NATIONSBANK, N.A.
By:_______________________________
Name:___________________________
Title:__________________________
-20-
ACKNOWLEDGMENT OF GUARANTOR
The undersigned acknowledges the foregoing Fourth Amendment and agrees that
its Subsidiary Guaranty remains in full force and effect, subject to no right of
offset, defense, claim or counterclaim. The undersigned does hereby remise,
release, acquit, satisfy and forever discharge the Lender, and all of the
respective past, present and future officers, directors, employees, agents,
attorneys, representatives, participants, heirs, successors and assigns of the
Lender from any and all manner of debts, accountings, bonds, warranties,
representations, covenants, promises, contracts, controversies, agreements,
liabilities, obligations, expenses, damages, judgments, executions, actions,
claims, demands and causes of action of any nature whatsoever, whether at law or
in equity, either now accrued or hereafter maturing or whether known or unknown,
which the undersigned now has or hereafter can, shall or may have by reason of
any manner, cause or things, from the beginning of the world to and including
the date of this Amendment.
The undersigned does hereby covenant and agree never to institute or cause to
be instituted or continued prosecution of any suit or other form of action or
proceeding of any kind or nature whatsoever against the Lender or any
Subsidiaries or Affiliates of the Lender or any of their respective past,
present or future officers, directors, employees, agents, attorneys,
representatives, participants, heirs, successors or assigns, by reason of or in
connection with any of the foregoing matters, claims or causes of action;
provided, however, that the foregoing release and covenant not to xxx shall not
apply to any claims arising after the date of this Amendment with respect to
acts, occurrences or events after the date of this Amendment. The undersigned
expressly acknowledges and agrees that the waivers, estoppels and releases in
favor of the Lender contained in this Amendment shall not be construed as an
admission of any wrongdoing, liability or culpability on the part of the Lender
or as any admission by the Lender of the existence of claims by the undersigned
against the Lender.
The undersigned further acknowledges and agrees that, to the extent any such
claims exist, they are of a speculative nature so as to be incapable of
objective evaluation and that, to the extent that any such claims may exist and
may have value, such value would constitute primarily "nuisance" value or
"leverage" value in adversarial proceedings between the undersigned and the
Lender. In any event, the undersigned and the Lender, and each of them,
acknowledge and agree that the value to the undersigned of the covenants and
agreements on the part of the Lender contained in this Amendment substantially
and materially exceed any and all value of any kind or nature whatsoever of any
claims or other liabilities waived or released by the undersigned.
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BUS PRO, INC.
By:_________________________
Name:______________________
Title:_____________________
[CORPORATE SEAL]
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[UPDATED SCHEDULES TO THE LOAN AGREEMENT TO
BE PROVIDED BY THE BORRWER AND ITS COUNSEL]
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