EXHIBIT 10.5
SIXTH AMENDMENT TO
LOAN AND SECURITY AGREEMENT
This Sixth Amendment to Loan and Security Agreement (this
"Amendment"), is made and entered into effective as of the 30th day of June,
1998 by and between FINOVA CAPITAL CORPORATION, a Delaware corporation
("Lender") and AMERITRUCK DISTRIBUTION CORP., a Delaware corporation
("Borrower"). This Amendment modifies and amends that certain Loan and Security
Agreement, dated May 5, 1997, between Lender and Borrower (the "Agreement").
All terms used herein with initial capital letters, unless otherwise
specifically defined herein, shall have the same meanings as set forth in the
Agreement. All references to the Agreement shall include the Schedule.
R E C I T A L S:
WHEREAS, Borrower has informed Lender that an Overline in the amount
of Five Million Seven Hundred Thirty Thousand Dollars ($5,730,000) exists as a
result of the reappraisal of the Equipment of the Loan Parties;
WHEREAS, in connection therewith, Borrower has requested that Lender
temporarily permit the Overline to remain outstanding;
WHEREAS, Lender has agreed to temporarily permit the Overline to
remain outstanding as provided herein;
NOW, THEREFORE, in consideration of the foregoing premises and other
valuable consideration, the parties hereto agree as follows:
1. Amendment. The Agreement is amended as follows:
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(a) Section 1.3 of the Agreement shall be amended and restated in
its entirety as follows:
"1.3 Overlines. If at any time or for any reason the outstanding
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amount of advances made pursuant hereto exceeds any of the dollar or
percentage limitations contained in the Schedule (any such excess, an
"Overline"), then Borrower shall, upon Lender's demand, immediately pay to
Lender, in cash, the full amount of such Overline; provided, that if the
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amount of such Overline is less than Five Hundred Thousand Dollars
($500,000), Borrower shall pay to Lender, in cash, the full amount of such
Overline within five (5) Business Days following demand by Lender; provided
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further, that the Overline in the amount of Five Million Seven Hundred
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Thirty Thousand Dollars ($5,730,000) (the "Temporary Overline") arising as
a result of the reappraisal of the Equipment of the Loan Parties by Xxxxxx
& Xxxxxx pursuant to the Appraisal dated June 2, 1998 may remain
outstanding until the
"Temporary Overline Expiration Date" (as defined below), at which time the
Temporary Overline shall be immediately due and payable. "Temporary
Overline Expiration Date" means the earlier of (A) July 31, 1998 and (B)
the date either Congress Financial Corporation (Southwest) and/or Xxxxxxxx,
L.L.C. terminate the Commitment Letter dated June 19, 1998 issued by them
to Borrower. Without limiting Borrower's obligation to repay to Lender on
demand the amount of any Overline, Borrower agrees to pay Lender interest
on the outstanding principal amount of any Overline, on demand, at the rate
set forth on the Schedule."
(b) The first section of Section 3.1(A) of the Schedule to the
Agreement is amended and restated in its entirety as follows:
INTEREST AND FEES (SECTION 3.1):
A. INTEREST.
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(i) The Revolving Loans shall bear interest on the
unpaid principal amount thereof from the date
such Revolving Loans are made and until paid in
full at one of the following rates, as selected
by Borrower from time to time as provided in
this Section 3.1:
(a) Base Rate Option. That portion of the
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outstanding principal balance of the
Revolving Loan subject to this option
shall bear interest at a fluctuating rate
per annum equal to (A) if the Second
Additional Availability Period has not
ended, the Base Rate plus one and three-
quarters percent (1.75%) and (B) the Base
Rate plus three-quarters of one percent
(0.75%) at all other times; and
(b) LIBOR Rate Option. That portion of the
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outstanding principal balance of the
Revolving Loan subject to this option
shall bear interest at a fixed rate per
annum equal to (A) if the Second
Additional Availability Period has not
ended, the LIBOR Rate applicable to such
LIBOR Rate Portion plus three and three-
quarters percent (3.75%) and (B) the LIBOR
Rate applicable to such LIBOR Rate
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Portion plus two and three-quarters
percent (2.75%) at all other times;
provided, that at all times on and after
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July 1, 1998 that any portion of the
Temporary Overline (as defined in Section
1.3) is outstanding, the outstanding
principal balance of the Revolving Loan
shall bear additional interest, in
addition to the interest set forth above,
of one percent (1%) per annum.
2. Confirmation of Liens. This Amendment in no way acts as a release
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or relinquishment of any of the liens, security interests, rights or remedies
securing payment of the Loans or of the enforcement thereof. Such liens,
security interests, rights and remedies are hereby ratified, confirmed,
preserved, renewed and extended by Borrower in all respects.
3. Reaffirmation of the Loan Documents. All terms, conditions and
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provisions of the Agreement and the other Loan Documents are hereby reaffirmed
and continued in full force and effect and shall remain unaffected and unchanged
except as specifically amended hereby. Without limiting the foregoing, Borrower
reaffirms its obligation to pay a Early Termination Fee of Two Hundred Thousand
Dollars ($200,000) in accordance with the terms of the Loan Agreement in the
event the Obligations are refinanced.
4. Representations and Warranties. Borrower represents and warrants
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to Len that the execution and delivery by Borrower of this Amendment has been
duly and properly made and authorized. The Loan Documents and this Amendment
each constitute valid and binding obligations of Borrower, enforceable in
accordance with their respective terms.
5. Benefit of the Amendment. The terms and provisions of this
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Amendment and the other Loan Documents shall be binding upon and inure to the
benefit of Lender and Borrower and their respective successors and assigns,
except that Borrower shall not have any right to assign its rights under this
Amendment or any of the Loan Documents or any interest therein without the prior
written consent of Lender.
6. Choice of Law. The Loan Documents and this Amendment shall be
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performed and construed in accordance with the laws of the State of Arizona.
7. Entire Agreement. Except as modified by this Amendment, the Loan
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Documents remain in full force and effect. The Loan Documents, as modified by
this Amendment, embody the entire agreement and understanding between Borrower
and Lender, and supersede all prior agreements and understandings between said
parties relating to the subject matter thereof.
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8. Counterparts; Telecopy Execution. This Amendment may be executed
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in any number of separate counterparts, each of which, when taken together,
shall constitute one and the same agreement, admissible into evidence,
notwithstanding the fact that all parties have not signed the same counterpart.
Delivery of an executed counterpart of this Amendment by telefacsimile shall be
equally as effective as delivery of a manually executed counterpart of this
Amendment. Any party delivering an executed counterpart of this Amendment by
telefacsimile shall also deliver a manually executed counterpart of this
Amendment, but the failure to deliver a manually executed counterpart shall not
affect the validity, enforceability, and binding effect of this Amendment.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment
effective as of the day, month, and year first above written.
FINOVA CAPITAL CORPORATION, a Delaware
corporation
By
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Name
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Title
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AMERITRUCK DISTRIBUTION CORP., a
Delaware corporation
By
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Name
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Title
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REAFFIRMATION OF GUARANTORS
DATED JUNE 30, 1998
Each of the undersigned hereby (i) confirms that it has read the
foregoing Sixth Amendment, and (ii) reaffirms its obligations under the
Continuing Guaranty that it executed in favor of FINOVA Capital Corporation.
AMERITRUCK EQUIPMENT CORP.
AMERITRUCK LOGISTICS SERVICES, INC.
AMERITRUCK REFRIGERATED TRANSPORT, INC.
CMS TRANSPORTATION SERVICES, INC.
KTL, INC.
SCALES TRANSPORTATION CORPORATION
SCALES LEASING COMPANY, INC.
W&L SERVICES CORP.
W&L MOTOR LINES, INC.
AMERITRUCK OPERATIONS SERVICES, INC.
BEST WAY MOTOR LINES, INC.
PRO-TRANS SERVICES, INC.
By
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Name
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Title
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