AMENDMENT NO. 1 TO CREDIT AGREEMENT
THIS AMENDMENT NO. 1 TO CREDIT AGREEMENT (this "Amendment
Agreement") is made and entered into effective as of the 31st day
of January, 1998, by and among XXXXXX INDUSTRIES, INC., a
Tennessee corporation ("Xxxxxx"), and XXXXXX INDUSTRIES TOWING
EQUIPMENT INC., a Delaware corporation and wholly owned
subsidiary of Xxxxxx ("Xxxxxx Towing") (Xxxxxx and Xxxxxx Towing
may be referred to herein individually as a "Borrower" and
together as the "Borrowers"), EACH OF THE GUARANTORS SIGNATORY
HERETO (the "Guarantors"), NATIONSBANK OF TENNESSEE, NATIONAL
ASSOCIATION, a national banking association organized and
existing under the laws of the United States, as agent for the
Lenders ("Agent") under the Credit Agreement (as defined below),
and the Lenders. Unless the context otherwise requires, all
terms used herein without definition shall have the definitions
provided therefor in the Credit Agreement.
W I T N E S S E T H:
WHEREAS, the Agent, the Lenders and the Borrowers have
entered into that certain Credit Agreement dated as of January
30, 1998 (as hereby and from time to time amended, supplemented
or replaced, the "Credit Agreement"), pursuant to which the
Lenders have agreed to make and have made available to the
Borrowers a revolving credit facility with a letter of credit
sublimit and a swing line sublimit; and
WHEREAS, the parties hereto desire to amend the Credit
Agreement in the manner herein set forth effective as of the date
hereof;
NOW, THEREFORE, the parties hereby agree as follows:
1. DEFINITIONS. The term "Credit Agreement" or
"Agreement" (as the case may be) as used herein and in the Loan
Documents shall mean the Credit Agreement as hereby amended and
modified, and as further amended, modified or supplemented from
time to time as permitted thereby.
2. AMENDMENTS. Subject to the conditions hereof, the
Credit Agreement is hereby amended, effective as of the date
hereof, as follows:
(a) The following definition shall be included in
SECTION 1.1 of the Credit Agreement in its proper
alphabetical position:
"Net Repurchased Shares" has the meaning
ascribed to such term in SECTION 9.8.
(b) The definition of "Consolidated Tangible
Shareholders' Equity" set forth in SECTION 1.1 of the Credit
Agreement is hereby deleted in its entirety and replaced by
the following:
"Consolidated Shareholders' Equity" means, as
of any date on which the amount thereof is to be
determined, the sum of the following in respect of
Xxxxxx and its Subsidiaries (determined on a
consolidated basis): (i) the amount of issued and
outstanding share capital, plus (ii) the amount of
additional paid-in capital and retained earnings
(or, in the case of a deficit, minus the amount of
such deficit), plus (iii) the amount of any
foreign currency translation adjustment (if
positive, or, if negative, minus the amount of
such translation adjustment), plus (iv) the amount
of any non-recurring noncash restructuring charges
incurred since October 31, 1997, minus (v) the
amount of any treasury stock, all as determined in
accordance with GAAP applied on a Consistent
Basis.
(c) SECTION 8.22 of the Credit Agreement is hereby
deleted in its entirety and replaced by the following:
SECTION 8.22. Post-Closing Covenants. On or
before April 30, 1998, deliver to the Agent and
the Lenders the Pledge Agreement and Security
Instruments and other items required by SECTION
8.19(b) with respect to each Direct Foreign
Subsidiary of Xxxxxx, as if such Direct Foreign
Subsidiary were a newly-created Direct Foreign
Subsidiary subject to the provisions of such
SECTION 8.19(b).
(d) Subsection (a) of SECTION 9.1 of the Credit
Agreement is hereby deleted in its entirety and replaced by
the following:
(a) Consolidated Shareholders' Equity.
Permit Consolidated Shareholders' Equity to be
less than (i) $150,000,000 on January 31, 1998,
and (ii) at the last day of each succeeding fiscal
quarter of Xxxxxx (the "Step Up Date"), commencing
with the fiscal quarter ending April 30, 1998, and
until (but excluding) the last day of the next
following fiscal quarter of Xxxxxx, the difference
between (1) the sum of (A) the amount of
Consolidated Shareholders' Equity required to be
maintained pursuant to this SECTION 9.1(a) as at
the immediately preceding Step Up Date (or as at
January 31, 1998, in the case of the initial Step
Up Date), plus (B) fifty percent (50%) of
Consolidated Net Income for the period beginning
with the first day of such fiscal quarter of
Xxxxxx and ending on the Step Up Date, plus (C)
100% of the Net Proceeds of any Equity Offering,
minus (2) the aggregate cost of any Net
Repurchased Shares as of such Step Up Date, in an
amount up to but not exceeding $10,000,000 as
permitted pursuant to SECTION 9.8.
(e) SECTION 9.8 of the Credit Agreement is hereby
deleted in its entirety and replaced by the following:
9.8 Restricted Payments. Make any Restricted
Payment or apply or set apart any of their assets
therefor or agree to do any of the foregoing;
provided, however, that Xxxxxx may make the
following Restricted Payments during the period
indicated (on a non-cumulative basis, with the
effect that amounts not paid in any such period
may not be carried over for payment in a
2
subsequent period) if immediately prior to and
immediately after giving effect thereto no Default
or Event of Default shall exist: (i) Xxxxxx may
from time to time repurchase shares of its common
stock, $.01 par value per share (the "Common
Stock"), on the open market pursuant to a publicly
announced share repurchase program for the express
purpose of re-issuing such shares in one or more
Permitted Acquisitions, provided that the
aggregate cost of any shares of Common Stock which
have been so repurchased and not re-issued in
connection with a Permitted Acquisition (referred
to as "Net Repurchased Shares") at any given time
does not exceed $10,000,000, and (ii) Xxxxxx may
make additional Restricted Payments (other than
repurchases of Common Stock) during each Fiscal
Year, beginning with the 1998 Fiscal Year, in an
aggregate amount not to exceed $3,000,000.
(f) Exhibit M to the Credit Agreement is hereby
amended and restated in its entirety as set forth on Annex I
attached hereto and incorporated herein by reference.
3. GUARANTORS. Each Guarantor hereby (i) consents and
agrees to the amendments to the Credit Agreement set forth herein
and (ii) confirms its joint and several guarantee of payment of
all the Guarantors' Obligations pursuant to the Guaranty.
4. REPRESENTATIONS AND WARRANTIES. Each of the Borrowers
hereby certifies that:
(a) The representations and warranties made by the
Borrowers in Article VII of the Credit Agreement are true
and correct in all material respects on and as of the date
hereof, with the same effect as though such representations
and warranties were made on the date hereof, except to the
extent that such representations and warranties expressly
relate to an earlier date.
(b) No event has occurred and no condition exists
which, upon the consummation of the transaction contemplated
hereby, will constitute a Default or an Event of Default on
the part of the Borrowers under the Credit Agreement or any
other Loan Document either immediately or with the lapse of
time or the giving of notice, or both.
5. ENTIRE AGREEMENT. This Amendment Agreement 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
herein, 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 Agreement may be changed,
modified, waived or canceled orally or otherwise, except by
writing, signed by all the parties hereto, specifying such
change, modification, waiver or cancellation of such terms or
conditions, or of any preceding or succeeding breach thereof.
3
6. FULL FORCE AND EFFECT OF AGREEMENT. Except as hereby
specifically amended, modified or supplemented, the Credit
Agreement and all of the other Loan Documents are hereby
confirmed and ratified in all respects and shall remain in full
force and effect according to their respective terms.
7. COUNTERPARTS. This Amendment Agreement may be executed
in one or more counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the
same instrument.
8. GOVERNING LAW. This Agreement shall in all respects be
governed by, and construed in accordance with, the laws of the
State of Georgia.
9. ENFORCEABILITY. Should any one or more of the
provisions of this Amendment Agreement 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.
10. CREDIT AGREEMENT. All references in any of the Loan
Documents to the "Credit Agreement" shall mean the Credit
Agreement as amended hereby.
11. SUCCESSORS AND ASSIGNS. This Amendment Agreement shall
be binding upon and inure to the benefit of each of the
Borrowers, the Lenders and the Agent and their respective
successors, assigns and legal representatives; provided, however,
that the Borrowers, without the prior consent of the Agent, may
not assign any rights, powers, duties or obligations hereunder.
12. EXPENSES. The Borrowers agree to pay to the Agent and
the Lenders all reasonable out-of-pocket expenses incurred or
arising in connection with the negotiation and preparation of
this Amendment Agreement.
[Signature pages follow.]
4
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment No. 1 to Credit Agreement to be duly executed by their
duly authorized officers, all as of the day and year first above
written.
BORROWERS:
XXXXXX INDUSTRIES, INC.
By: /s/ Xxxx Xxxxxxx
Name: Xxxx Xxxxxxx
Title: VP CFO
XXXXXX INDUSTRIES TOWING EQUIPMENT
INC.
By: /s/ Xxxxx Xxxxx
Name: Xxxxx Xxxxx
Title: Vice President of Finance
AMENDMENT NO. 1 TO CREDIT AGREEMENT
SIGNATURE PAGE 1 OF 5
GUARANTORS:
A-2 WRECKER SERVICE, INC.
A-EXCELLENCE TOWING CO.
ALL AMERICAN TOWING SERVICES, INC.
ALLIED TOWING AND RECOVERY, INC.
APACO, INC.
APPLE TOWING CO., INC.
A TO Z ENTERPRISES, INC.
B&B ASSOCIATED INDUSTRIES, INC.
BEAR TRANSPORTATION, INC.
BERT'S TOWING RECOVERY CORPORATION
XXX XXXXX SERVICES, INC.
BOULEVARD & TRUMBULL TOWING, INC.
XXXXXX'X, INC.
C&L TOWING SERVICES, INC.
XXXXXX INVESTMENT CORPORATION
CEDAR BLUFF 24 HOUR TOWING, INC.
CENTURY HOLDINGS, INC.
CHAMPION CARRIER CORPORATION
CHEVRON, INC.
CHEVRON SOUTH/SOUTHERN WRECKER
LEASING, INC.
CHICAGO METRO SERVICES, INC.
CLEVELAND VEHICLE DETENTION CENTER,
INC.
COMPETITION WHEELIFT, INC.
X.X. XXXXXXXX, INC.
DICK'S TOWING & ROAD SERVICE, INC.
DOLLAR ENTERPRISES, INC.
E.B.T., INC.
EXPORT ENTERPRISES, INC.
GEORGIA EXPORT ENTERPRISES, INC.
GOLDEN WEST TOWING EQUIPMENT INC.
GOOD MECHANIC AUTO CO. OF
RICHFIELD, INC.
GREG'S TOWING, INC.
H&H TOWING ENTERPRISES, INC.
HALL'S TOWING SERVICE, INC.
XXXXXXXXXXX TOWING, INC.
H.M.R. ENTERPRISES, INC.
INTERSTATE TOWING & RECOVERY, INC.
XXXXXXX WRECKER SERVICE, INC.
XXXXXXXX ENTERPRISES, INC.
XXXXX'X, INC.
KING AUTOMOTIVE & INDUSTRIAL
EQUIPMENT, INC.
LAZER TOW SERVICES, INC.
XXXXX WRECKER SERVICE, INC.
LINCOLN TOWING ENTERPRISES, INC.
MERL'S TOWING SERVICE, INC.
MID-AMERICA WRECKER & EQUIPMENT
SALES, INC. OF COLORADO
MIKE'S WRECKER SERVICE, INC.
XXXXXX FINANCIAL SERVICES GROUP, INC.
XXXXXX/GREENEVILLE, INC.
XXXXXX INDUSTRIES DISTRIBUTING, INC.
AMENDMENT NO. 1 TO CREDIT AGREEMENT
SIGNATURE PAGE 2 OF 5
XXXXXX INDUSTRIES INTERNATIONAL, INC.
XXXXX'X SERVICE & TOWING, INC.
XXXXX'X TOWING SERVICE, INC.
XXXXXX'X TOWING, INC.
OFFICIAL TOWING, INC.
X'XXXX TRUCK SERVICE, INC.
PETE'S A TOWING, INC.
PIPES ENTERPRISES, INC.
PURPOSE, INC.
RAR ENTERPRISES, INC.
RANDY'S HIGH COUNTRY TOWING, INC.
XXX XXXXXX, INC.
ROAD XXXXXX, INC.
ROAD ONE, INC.
ROAD ONE INSURANCE SERVICES, INC.
ROAD ONE SERVICE, INC.
XXXXX XXXXXX WRECKER SERVICE INC.
SANDY'S AUTO & TRUCK SERVICE, INC.
SOUTHERN WRECKER CENTER, INC.
SOUTHERN WRECKER SALES, INC.
SPEED'S AUTOMOTIVE, INC.
SPEED'S RENTALS, INC.
XXXXX'X AUTOMOTIVE SERVICES, INC.
SUBURBAN WRECKER SERVICE, INC.
TEAM TOWING AND RECOVERY, INC.
TED'S OF FAYVILLE, INC.
TEXAS TOWING CORPORATION
XXXXXXXX'X WRECKER SERVICE, INC.
TREASURE COAST TOWING, INC.
TRUCK SALES & SALVAGE CO., INC.
AMENDMENT NO. 1 TO CREDIT AGREEMENT
SIGNATURE PAGE 3 OF 5
XXXXXXX CORPORATION
VULCAN EQUIPMENT COMPANY, INC.
VULCAN INTERNATIONAL (DELAWARE), INC.
XXXXXX TOWING, INC.
WES'S SERVICE INCORPORATED
ZEBRA TOWING, INC.
By: /s/ Xxxxx Xxxxxxx
Name: Xxxxx Xxxxxxx
Title: Attorney-in-Face
AMENDMENT NO. 1 TO CREDIT AGREEMENT
SIGNATURE PAGE 4 OF 5
AGENT AND LENDERS:
NATIONSBANK OF TENNESSEE,
NATIONAL ASSOCIATION,
as Agent for the Lenders and as a Lender
By: /s/ Xxxxxxxx X. Xxxxxx
Name: Xxxxxxxx X. Xxxxxx
Title: Sr. VP
BANK OF AMERICA, FSB
By: /s/ Xxxxxx Xxx
Name: Xxxxxx Xxx
Title: Vice President
WACHOVIA BANK, N.A.
By: /s/ Xxxx X. Xxxx
Name: Xxxx X. Xxxx
Title: AVP
FIRST AMERICAN NATIONAL BANK
By: /s/ Xxxxxxx X. Xxxxxxxx
Name: Xxxxxxx X. Xxxxxxxx
Title: Executive Vice President
AMENDMENT NO. 1 TO CREDIT AGREEMENT
SIGNATURE PAGE 5 OF 5
ANNEX I
EXHIBIT M
Compliance Certificate
NationsBank of Tennessee,
National Association, as Agent
Independence Center, 15th Xxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services
Telefacsimile: (000) 000-0000
Reference is hereby made to the Credit Agreement dated as of
January 30, 1998 (as may be amended from time to time, the
"Agreement") among XXXXXX INDUSTRIES, INC., a Tennessee
corporation ("Xxxxxx"), XXXXXX INDUSTRIES TOWING EQUIPMENT INC.,
a Delaware corporation ("Xxxxxx Towing," and together with
Xxxxxx, the "Borrowers"), the Lenders (as defined in the
Agreement) and NationsBank of Tennessee, National Association, as
Agent for the Lenders ("Agent"). Capitalized terms used but not
otherwise defined herein shall have the respective meanings
therefor set forth in the Agreement. The undersigned, a duly
authorized and acting Authorized Representative, hereby certifies
to you as of _____________, 19___ (the "Determination Date") as
follows:
1. Calculations
A. Compliance with SECTION 9.1(a): Consolidated
Shareholders' Equity
1. Issued and outstanding share capital $__________
2. Additional paid-in capital plus retained income
(retained deficit to be expressed as a negative) $__________
3. Foreign currency translation (to be expressed as
a negative, if applicable) $__________
4. Non-recurring noncash restructuring charges
since ____________, 19__ $__________
5. Treasury stock $___________
6. Consolidated Shareholders' Equity
(A.1 + A.2 + A.3 + A.4 - A.5) $___________
Required:
(i) Requirement for prior fiscal quarter; plus $___________
(ii) 50% of Consolidated Net Income since first
day of current fiscal quarter; plus $___________
Annex I-1
(iii) 100% of the Net Proceeds of any Equity
Offering $___________
Total: $___________
B. Compliance with SECTION 9.1(b): Consolidated Funded
Senior Indebtedness to Consolidated EBITDA
1. Consolidated Funded Senior Indebtedness $__________
2. Consolidated EBITDA for such period $__________
a. Consolidated Net Income $__________
b. Consolidated Interest Expense $__________
c. Taxes on income $__________
d. Amortization $__________
e. Depreciation $__________
f. Non-recurring noncash
restructuring charges $__________
g. Net gains on the sale, conversion
or other disposition of capital
assets $__________
h. Net gains on the acquisition,
retirement, sale or other
disposition of capital stock and
other securities $__________
i. Net gains on the collection of
proceeds of life insurance
policies $__________
j. Write-ups of any assets other than
permitted by FAS 16 $__________
k. Other extraordinary net gains
or credits $__________
TOTAL ([a + b +c + d + e + f] -
[g + h + i + j + k]) $__________
3. Ratio of B.2 to B.1 ____ to ____
Required: Line 3 must not be more than 3.00
to 1.00
C. Compliance with SECTION 9.1(c): Consolidated Funded
Total Indebtedness to Consolidated EBITDA
1. Consolidated Funded Total Indebtedness $__________
2. Consolidated EBITDA for such period (see B.2) $__________
3. Ratio of C.2 to C.1 ____ to ___
Required: Line 3 must not be more than 3.50
to 1.00
D. Compliance with SECTION 9.1(d): Consolidated Fixed
Charge Ratio
1. Consolidated EBITDA for such period (see B.2) $___________
2. Lease, rental and other expenses in connection
with operating leases for such period $___________
3. Capital Expenditures for such period $___________
4. Taxes paid or accrued on income for such period $___________
Annex I-2
5. Consolidated Fixed Charges for such period:
(i) Consolidated Interest
Expense, plus $___________
(ii) Lease, rental and other expenses
in connection with operating
leases, plus $___________
(iii) Current maturities of Consolidated
Funded Total Indebtedness, plus $___________
(iv) Current maturities of Capital
Leases, plus $___________
(v) Payments in respect of Acquisitions
representing any deferred portion
of consideration, plus $___________
(vi) Payments in respect of Off Balance
Sheet Liabilities $___________
TOTAL (i + ii + iii + iv + v + vi) $___________
6. D.1 + D.2 $___________
7. D.3 + D.4 $___________
8. D.6 - D.7 $___________
9. Ratio of C.8 to C.5 ___ to ___
Required: Not less than --
Closing Date through and including the
day immediately prior to Fiscal Year
End 1999 1.00 to 1.00
Fiscal Year End 1999 through and including
the day immediately prior to Fiscal Year 2000 1.20 to 1.00
Fiscal Year End 2000 and thereafter 1.25 to 1.00
E. Compliance with SECTION 9.2: Acquisitions
1. Acquisitions during fiscal quarter, including Cost
of Acquisition
a. Name of Subsidiary: ______________ $__________
b. Name of Subsidiary: ______________ $__________
c. Name of Subsidiary: ______________ $__________
d. Name of Subsidiary: ______________ $__________
e. Name of Subsidiary: ______________ $__________
f. Name of Subsidiary: ______________ $__________
g. Name of Subsidiary: ______________ $__________
h. Name of Subsidiary: ______________ $__________
2. Total Cost of Acquisition during fiscal quarter $__________
3. Total Cost of Acquisition during prior fiscal
quarters during such Fiscal year $__________
4. Total Cost of Acquisition during Fiscal Year to
date $__________
Required: Cost of Acquisition not greater than
$10,000,000 per acquisition or
$50,000,000 in any Fiscal Year
Annex I-3
F. Compliance with SECTION 9.4(d): Purchase Money
Indebtedness and Capital Lease Obligations
1. Purchase money and Capital Lease obligations $__________
Required: Not more than $5,000,000 outstanding
at any time
G. Compliance with SECTION 9.4(e): Guarantees of Trade
Account Indebtedness
1. Guarantees of trade account indebtedness $__________
Required: Not more than $2,000,000 outstanding
at any time
H. Compliance with SECTION 9.4(h): Additional Indebtedness
1. Total additional Indebtedness $__________
Required: Not more than $5,000,000 outstanding
at any time
I. Compliance with SECTION 9.8: Restricted Payments
1. Repurchases of Common Stock
a. Aggregate cost of Net Repurchased
Shares at end of prior quarter $_________
b. Aggregate cost of shares repurchased
during quarter $__________
c. Aggregate cost of shares reissued
in connection with Permitted
Acquisitions during quarter $__________
d. Aggregate cost of Net Repurchased
Shares at end of current quarter
(a + b - c) $__________
Required: Not more than $10,000,000 in aggregate
cost of Net Repurchased Shares at
any time
2. Additional Restricted Payments
a. Restricted Payments during fiscal
quarter $__________
b. Restricted Payments during prior
fiscal quarters during such Fiscal
Year $__________
c. Restricted Payments during
Fiscal Year to date $__________
Required: Restricted Payments not greater than
$3,000,000 during any Fiscal Year
Annex I-4
2. No Default
A. Since __________ (the date of the last similar
certification), (a) the Borrowers have not defaulted in the
keeping, observance, performance or fulfillment of its
obligations pursuant to any of the Loan Documents; and
(b) no Default or Event of Default specified in Article X of
the Agreement has occurred and is continuing.
B. If a Default or Event of Default has occurred
since __________ (the date of the last similar
certification), the Borrowers propose to take the following
action with respect to such Default or Event of Default: ____
_____________________________________________________________
_____________________________________________________________
____________________________________________________________
________________________.
(Note, if no Default or Event of Default has occurred,
insert "Not Applicable").
The Determination Date is the date of the last required
financial statements submitted to the Lenders in accordance with
SECTION 8.1 of the Agreement.
IN WITNESS WHEREOF, I have executed this Certificate this _____
day of __________, 19___.
By:_________________________________
Authorized Representative
Name:_______________________________
Title:______________________________
Annex I-5
