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Exhibit 10.2(c)
SECOND AMENDMENT TO CREDIT AGREEMENT
SECOND AMENDMENT, dated as of March 12, 1997 (this
"AMENDMENT"), to the Credit Agreement, dated as of March 24, 1995
(the "CREDIT AGREEMENT"), among CALIBER SYSTEM, INC. (formerly
ROADWAY SERVICES, INC.), an Ohio corporation (the "BORROWER"),
the several banks and other financial institutions parties
thereto (the "LENDERS") and THE CHASE MANHATTAN BANK (formerly
known as Chemical Bank), a New York banking corporation, as agent
(in such capacity, the "AGENT") for the Lenders.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Borrower has requested the Agent and the
Lenders to agree to amend certain provisions of the Credit
Agreement; and
WHEREAS, the Agent and the Lenders are willing to agree
to such amendments, but only on the terms and subject to the
conditions set forth in this Amendment;
NOW, THEREFORE, in consideration of the premises and
for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, the parties hereto hereby agree as
follows:
1. DEFINITIONS. Unless otherwise defined herein,
terms defined in the Credit Agreement are used herein as therein
defined.
2. AMENDMENTS TO SUBSECTION 1.1. Subsection 1.1 is
hereby amended by:
(a) deleting the definitions of "Applicable Margin"
and "Minimum Consolidated Net Worth" and substituting in lieu of
thereof the following:
"APPLICABLE MARGIN" for any day, with respect to any
Eurodollar Loan, or with respect to the facility fees and
utilization fees payable hereunder, as the case may be, the
applicable rate per annum set forth below under the caption
"Eurodollar Spread," "Facility Fee Rate" or "Utilization Fee
Rate," as the case may be, based upon the ratings by Moody's
and S&P, respectively, applicable on such date to the Index
Debt:
"MINIMUM CONSOLIDATED NET WORTH": for the fiscal year
1996, $600,000,000 and for each fiscal quarter thereafter,
the sum of (a) 50% of the Borrower's consolidated net income
after dividends for such period (but only if the amount
calculated pursuant to this clause (a) is positive) and (b)
the Minimum Consolidated Net Worth for the prior period.
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Eurodollar Facility Fee Utilization
Index Debt Ratings: Spread Rate Fee Rate
------------------- ---------- ------------ -----------
Category 1 .15% .10% .075%
Category 2 .235% .125% .100%
Category 3 .3125% .1875% .125%
Category 4 .50% .25% .125%
For purposes of the foregoing, (i) if either
Moody's or S&P shall not have in effect a rating for the
Index Debt (other than by reason of the circumstances
referred to in the last sentence of this definition), then
such rating agency shall be deemed to have established a
rating in Category 4 and (ii) if the ratings established or
deemed to have been established by Moody's and S&P for the
Index Debt shall be changed (other than as a result of a
change in the rating system of Moody's or S&P), such change
shall be effective as of the date on which it is first
announced by the applicable rating agency. Each change in
the Applicable Margin shall apply during the period
commencing on the effective date of such change and ending
on the date immediately preceding the effective date of the
next such change. If the rating system of Moody's or S&P
shall change, or if either such rating agency shall cease to
be in the business of rating corporate debt obligations, the
Borrower and the Lenders shall negotiate in good faith to
amend this definition to reflect such changed rating system
or the unavailability of ratings from such rating agency
and, pending the effectiveness of any such amendment, the
Applicable Margin shall be determined by reference to the
rating most recently in effect prior to such change or
cessation.
(b) adding thereto the following definitions in the
proper alphabetical order:
"CATEGORY 1": applies on any day on which the S&P
Rating of the Index Debt is at least A- and the Xxxxx'x
rating of the Index Debt is at least A3.
"CATEGORY 2": applies on any day on which (a) Category
1 does not apply and (b) the S&P rating of the Index Debt is
at least BBB+ and the Xxxxx'x rating of the Index Debt is at
least Baa1.
"CATEGORY 3": applies on any day on which (a) neither
Category 1 nor Category 2 applies and (b) the S&P rating of
the Index Debt is at least BBB- and the Xxxxx'x rating of
the Index Debt is at least Baa3.
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"CATEGORY 4": applies on any day on which neither
Category 1, Category 2 nor Category 3 applies.
"EBITDA": for any fiscal period, Net Income or Net Loss,
as the case may be, for such fiscal period, after restoring
thereto amounts deducted for, without duplication,
(a) interest expense, (b) taxes based upon net income, (c)
depreciation and amortization, (d) other non-cash charges and
(e) rental expense.
"INDEX DEBT": senior, unsecured, long-term indebtedness
for borrowed money of the Borrower that is not guaranteed by
any other Person or subject to any other credit enhancement.
"MOODY'S": Xxxxx'x Investors Service, Inc.
"NET INCOME" or "NET LOSS": for any fiscal period, the
amount which, in conformity with GAAP, would constitute the
net income or net loss, as the case may be, of the Borrower
and its Subsidiaries for such fiscal period; PROVIDED that Net
Income or Net Loss for the Borrower's 1996 fiscal year and for
any fiscal period during the Borrower's 1997 fiscal year shall
exclude extraordinary, unusual and non-recurring gains and
losses relating to the Viking Restructuring (but only to the
extent any such losses do not exceed $275,000,000 during the
Borrower's 1996 and 1997 fiscal years).
"S&P": Standard & Poor's.
"TOTAL DEBT": of any Person at any date, (a) all
indebtedness of such Person for borrowed money or for the
deferred purchase price of property or services (other than
current trade liabilities incurred in the ordinary course of
business and payable in accordance with customary practices),
(b) any other indebtedness of such Person which is evidenced
by a note, bond, debenture or similar instrument, (c) all
obligations of such Person under Financing Leases, (d) all
obligations of such Person in respect of acceptances issued or
created for the account of such Person and with respect to
unpaid reimbursement obligations related to letters of credit
issued for the account of such Person, (e) all liabilities
secured by any Lien on any property owned by such Person even
though such Person has not assumed or otherwise become liable
for the payment thereof, (f) the present value (discounted at
a rate per annum equal to 8.00%) of the future committed
rental payments of such Person under operating leases which
would be required in accordance with GAAP to be described in
the footnotes to an audited financial statement of such Person
prepared as of such date and (g) all Guarantee Obligations of
such Person in respect of Total Debt of other Persons (other
than any such Guarantee Obligation that would result from a
sublease by such Person in any case where the obligations of
such Person under such sublease would not be required in
accordance with GAAP to be described in the footnotes to an
audited financial statement of such Person prepared as of such
date).
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"VIKING RESTRUCTURING": the sale or liquidation of the
business of Viking Freight Systems other than the Western
Division thereof.
"VIKING RESTRUCTURING CHARGES": all charges to income
and expenses incident to the Viking Restructuring
(including, without limitation, impairment charges,
transition expenses and certain related asset writedowns).
(c) deleting the definition of "Debt/Capitalization
Ratio."
3. AMENDMENT TO SUBSECTIONS 2.4 AND 2.4A.
Subsections 2.4 and 2.4A of the Credit Agreement are hereby
amended to read in their entirety as follows:
2.4 FACILITY FEE. The Borrower agrees to pay to the
Agent for the account of each Lender a facility fee (the
"FACILITY FEE") on the amount of such Lender's Commitment
for the period from and including the date of this Agreement
to the Termination Date, payable quarterly in arrears on the
last day of each March, June, September and December and on
the Termination Date or such earlier date as the Commitments
shall terminate as provided herein, commencing on the first
of such dates to occur after the date hereof. The Facility
Fee will be equal to the applicable rate per annum set forth
under the heading "Facility Fee Rate" in the definition of
the term "Applicable Margin."
2.4A UTILIZATION FEE. The Borrower agrees to pay to
the Agent for the account of each Lender a utilization fee
(the "UTILIZATION FEE") on the aggregate principal amount of
the Loans outstanding for each day during which the
aggregate principal amount of the Loans exceeds 66 2/3% of
the Commitments, payable quarterly in arrears on the last
day of each March, June, September and December and, if
applicable, on the Termination Date or such later date upon
which the Loans shall be paid in full. The Utilization Fee
will be equal to the applicable rate per annum set forth
under the heading "Utilization Fee Rate" in the definition
of the term "Applicable Margin."
4. AMENDMENT TO SUBSECTION 6.1. Subsection 6.1 of
the Credit Agreement is hereby amended to read in its entirety as
follows:
6.1 MAINTENANCE OF CONSOLIDATED NET WORTH; LIMITATION
ON LEVERAGE. (a) Permit at any time the sum of (i)
Consolidated Net Worth plus (ii) the aggregate amount (but
in no event more than $275,000,000) of Viking Restructuring
Charges for the Borrower's 1996 and 1997 fiscal years to be
less than the applicable Minimum Consolidated Net Worth.
(b) Permit the aggregate amount of Total Debt
outstanding on the last day of any fiscal quarter to EBITDA
of the Borrower and its Subsidiaries for the period of four
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consecutive fiscal quarters then ending to exceed (i) in the
case of the first two fiscal quarters of the Borrower's 1997
fiscal year, 3.00 to 1.00 or (ii) in the case of any
subsequent fiscal quarter, 2.75 to 1.00.
5. AMENDMENT TO SUBSECTION 6.4. Subsection 6.4 of
the Credit Agreement is hereby amended by deleting the word "and"
in subsection 6.4(d) and by adding the following paragraphs in
their proper order:
(f) the Viking Restructuring; and
(g) the sale, in connection with a sale and leaseback
transaction, of the RPS headquarters building located in the
Pittsburgh, Pennsylvania area; PROVIDED that the net cash
proceeds thereof shall be applied to prepay the Loans.
6. REPRESENTATIONS AND WARRANTIES. The Borrower
hereby confirms that, after giving effect to the amendments
provided for herein, (i) the representations and warranties
contained in Section 3 of the Credit Agreement are true and
correct in all material respects on and as of the date hereof and
no Default or Event of Default has occurred and is continuing and
(ii) the Borrower has all necessary power and has taken all
corporate action necessary to approve and authorize this
Amendment.
7. NO OTHER AMENDMENTS. Except as expressly amended
hereby, the Credit Agreement shall continue to be, and shall
remain, in full force and effect in accordance with its terms.
8. COUNTERPARTS. This Amendment may be executed by
the parties hereto in any number of separate counterparts, and
all of such counterparts taken together shall be deemed to
constitute one and the same instrument.
9. CONDITIONS OF EFFECTIVENESS. This Amendment shall
become effective on the date on which the Borrower and each of
the Lenders shall have executed a counterpart of this Amendment,
and the Agent shall have received confirmation of such execution
and a fee payable to each Lender in an amount equal to 0.10% of
such Lender's Commitment.
10. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED
BY, AND SHALL BE CONSTRUED AND INTERPRETED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.
11. COSTS AND EXPENSES. The Borrower agrees to pay
all reasonable costs and expenses (including reasonable
attorneys' fees) incurred by the Agent in connection with the
preparation, execution and delivery of this Amendment.
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their proper and
duly authorized officers as of the date set forth above.
CALIBER SYSTEM, INC.
By: /s/
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Title:
THE CHASE MANHATTAN BANK, as Agent and
as a Lender
By:
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Title:
ABN-AMRO BANK N.V.
By:
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Title:
NATIONAL CITY BANK
By:
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Title:
SOCIETY NATIONAL BANK
By:
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Title:
BANK ONE, AKRON, N.A.
By:
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Title:
THE FIRST NATIONAL BANK OF CHICAGO
By:
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Title:
