HUB GROUP, INC.
HUB CITY TERMINALS, INC.
AMENDMENT TO CREDIT AGREEMENT
Xxxxxx Trust and Savings Bank LaSalle Bank National Association
Chicago, Illinois Chicago, Illinois
U.S. Bank National Association National City Bank
Des Plaines, Illinois Cleveland, Ohio
Firstar Bank, N.A.
Milwaukee, Wisconsin
Ladies and Gentlemen:
Reference is hereby made to that certain Credit Agreement dated as of
April 30, 1999 (the "CREDIT AGREEMENT"), as amended and currently in effect, by
and among Hub Group, Inc. (the "PUBLIC HUB COMPANY"), Hub City Terminals, Inc.
for itself and as successor by merger to Hub Holdings, Inc. ("HUB CHICAGO";
together with the Public Hub Company, the "Borrowers") and you (the "LENDERS").
All capitalized terms used herein without definition shall have the same
meanings herein as such terms have in the Credit Agreement.
The Borrowers have requested that the Lenders amend certain financial
covenants and make certain other amendments to the Credit Agreement, and the
Lenders are willing to do so under the terms and conditions set forth in this
amendment (herein, the "AMENDMENT").
1. IMMEDIATE AMENDMENTS.
Upon the execution of this Amendment by the Borrowers and the
Guarantors and its acceptance by the Required Lenders, the Credit Agreement
shall be and hereby is amended as of June 29, 2000 (except that the amendment
set forth in Section 1.03 hereof shall be as of November 9, 2000) as follows:
1.01. Section 7.8 of the Credit Agreement shall be and hereby is
amended by adding the following sentence immediately at the end thereof:
"Notwithstanding anything contained in this Section
to the contrary, the Borrowers shall not be in default of this
Section as of (i) the fiscal quarter of the Public Hub Company
ending on June 30, 2000, if the Fixed Charge Coverage Ratio as
of such date is greater than or equal to 0.95 to 1 or (ii) the
fiscal quarter of the Public Hub Company ending on September
30, 2000, if the Fixed Charge Coverage Ratio as of such date
is greater than or equal to 0.80 to 1."
1.02. Section 7.10 of the Credit Agreement shall be and hereby is
amended by adding the following sentence immediately at the end thereof:
"Notwithstanding anything contained in this Section
to the contrary, the Borrowers shall not be in default of this
Section as of the fiscal quarter of the Public Hub Company
ending on September 30, 2000, if the Cash Flow Leverage Ratio
as of such date does not exceed 3.50 to 1."
1.03. The chart appearing in the definition of "APPLICABLE MARGIN"
appearing in Section 4.1 of the Credit Agreement shall be amended and as so
amended, shall be restated to read as follows:
Applicable
Margin For
Domestic Rate
Portion of
Revolving
"When Following Credit Loans
Status Exists and Swing Applicable
For Any Margin Loans Bearing Margin For Applicable Margin Applicable
Determination Interest with LIBOR Portions For Domestic Rate Margin For
Date Reference to of Revolving Portion of Term LIBOR Portions
Domestic Rate Credit Loans Loan Is: of Term Loan Is: Commitment Fee
Is: Is: Is:
Level I Status .25% 1.50% .25% 1.75% .25%
Level II Status .50% 2.00% .75% 2.25% .30%
Level III Status 1.00% 2.50% 1.25% 2.75% .40%
Level IV Status 1.25% 2.75% 1.50% 3.00% .50%"
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2. CONDITIONAL AMENDMENTS.
Subject to the satisfaction of the conditions precedent set forth in
Section 3 below, the Credit Agreement shall be and hereby is further amended as
of September 29, 2000 as follows:
2.01. The definition of "CASH MATURITIES" appearing in Section 4.1 of the
Credit Agreement shall be amended and as so amended shall be restated in its
entirety to read as follows:
"CASH MATURITIES" means for any period, the aggregate
amount of payments required to be made by the Hub Group in
cash during such period, with respect to principal on all
Indebtedness for Borrowed Money (whether at maturity, as a
result of mandatory sinking fund redemption, scheduled
mandatory prepayment, acceleration or otherwise); PROVIDED,
HOWEVER, Cash Maturities shall neither mean nor include (i)
principal payments on the Bridge Financing, (ii) principal
payments on the Revolving Credit, (iii) voluntary prepayments
and (iv) the principal payment of $5,225,000 scheduled to be
made to Quality Intermodal Corporation on or about April 1,
2001."
2.02. The definition of "FIXED CHARGE COVERAGE RATIO" appearing in
Section 4.1 of the Credit Agreement shall be amended and as so amended shall be
restated in its entirety to read as follows:
""FIXED CHARGE COVERAGE RATIO" means, as of any date
the same is to be determined, the ratio of (x) EBITDAM during
the four consecutive fiscal quarters of the Public Hub Company
ending on such date, or (if none so end) most recently
completed prior to such date, PLUS (i) Rents during such
period MINUS (ii) Capital Expenditures during such period
MINUS (iii) Restricted Payments during such period to (y) the
sum of (i) all Interest Expense during the same such period
PLUS (ii) Cash Maturities during such period PLUS (iii) Rents
during such period; PROVIDED, HOWEVER, that in computing the
Fixed Charge Coverage Ratio, Capital Expenditures paid or
accrued during the fiscal quarters of the Public Hub Company
ending on March 31, 2000, June 30, 2000, September 30, 2000
and December 31, 2000 shall be deemed $3,375,000 lower during
each of such quarters then the actual amount thereof."
2.03. The definition of "EBITDAM" appearing in Section 4.1 of the Credit
Agreement shall be amended and as so amended shall be restated in its entirety
to read as follows:
""EBITDAM" means, with reference to any period, Net
Income for such period plus all amounts deducted in arriving
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at such Net Income amount in respect of (i) Interest Expense
for such period, PLUS (ii) taxes (including federal, state and
local income taxes) for such period, PLUS (iii) all amounts
properly charged for depreciation and amortization during such
period on the books of the Hub Group, PLUS (iv) any deduction
for Minority Interest during such period, PLUS (v) if such
period includes the fiscal quarters of the Public Hub Company
ending on December 31, 2000 or March 31, 2001, non-cash
charges during such quarters on the books of the Hub Group in
accordance with GAAP aggregating up to $5,100,000 (for both
such quarters taken together), PLUS (vi) all other non-cash
charges during such period on the books of the Hub Group in
accordance with GAAP to the extent the aggregate amount of
such other non-cash charges do not exceed $2,500,000 during
any period of four consecutive fiscal quarters of the Public
Hub Company (prorated appropriately downward (or upward) for
any shorter (or longer) period); PLUS (vii) if such period
includes the fiscal quarters of the Public Hub Company ending
on December 31, 2000 or March 31, 2001, severance payments
made during such quarters aggregating up to $1,200,000 (for
both such quarters taken together); PLUS (viii) if such period
includes the fiscal quarters of the Public Hub Company ending
on March 31, 2001, June 30, 2001, September 30, 2001 or
December 31, 2001, severance payments (in addition to those
accounted for in clause (vii) above) made during such quarters
aggregating up to $600,000 (for all four such quarters taken
together)."
2.04. Section 7.8 of the Credit Agreement shall be amended and as so
amended shall be restated in its entirety to read as follows:
"SECTION 7.8. FIXED CHARGE COVERAGE RATIO. The Hub
Group shall not, as of the close of each fiscal quarter of the
Public Hub Company specified below, permit the Fixed Charge
Coverage Ratio as of such date to be less than:
FIXED CHARGE COVERAGE
AS OF THE FISCAL RATIO SHALL NOT BE LESS
QUARTER ENDING ON: THAN:
9/30/00 1.05 to 1
12/31/00 1.05 to 1
3/31/01 1.10 to 1
6/30/01 1.10 to 1
9/30/01 1.15 to 1
12/31/01 1.15 to 1
3/31/02 1.15 to 1
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FIXED CHARGE COVERAGE
AS OF THE FISCAL RATIO SHALL NOT BE LESS
QUARTER ENDING ON: THAN:
6/30/02 1.15 to 1
9/30/02 1.20 to 1
12/31/02 1.20 to 1
3/31/03 1.20 to 1
6/30/03 and at all times 1.25 to 1"
thereafter
2.05. Section 7.9 of the Credit Agreement shall be amended and as so
amended shall be restated in its entirety to read as follows:
"SECTION 7.9. MINIMUM EBITDAM. The Hub Group shall,
as of the close of each fiscal quarter of the Public Hub
Company specified below, maintain EBITDAM for the four fiscal
quarters of the Public Hub Company then ended of not less
than:
AS OF THE FISCAL EBITDAM SHALL NOT BE
QUARTER ENDING ON: LESS THAN:
9/30/00 $35,000,000
12/31/00 $30,000,000
3/31/01 $30,000,000
6/30/01 $30,000,000
9/30/01 $32,000,000
12/31/01 $35,000,000
3/31/02 $35,000,000
6/30/02 $36,000,000
9/30/02 $38,000,000
12/31/02 $38,000,000
3/31/03 $38,000,000
6/30/03 and at all times $40,000,000"
thereafter
2.06. Section 7.10 of the Credit Agreement shall be amended and as so
amended shall be restated to read as follows:
"SECTION 7.10. CASH FLOW LEVERAGE RATIO. The Hub
Group shall not, as of the close of each fiscal quarter of the Public Hub
Company specified below, permit the Cash Flow Leverage Ratio as of such date to
be more than:
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CASH FLOW LEVERAGE
AS OF THE FISCAL RATIO SHALL NOT BE
QUARTER ENDING ON: MORE THAN:
9/30/00 3.50 to 1
12/31/00 3.85 to 1
3/31/01 3.75 to 1
6/30/01 3.75 to 1
9/30/01 3.50 to 1
12/31/01 3.25 to 1
3/31/02 3.25 to 1
6/30/02 3.00 to 1
9/30/02 3.00 to 1
12/31/02 2.75 to 1
3/31/03 2.75 to 1
6/30/03 and at all times 2.50 to 1"
thereafter
2.07. The first sentence of Section 3.3(b) of the Credit Agreement shall
be amended and as so amended shall be restated in its entirety to read as
follows:
"No later than ninety (90) days after the close of
each fiscal year of the Public Hub Company, the Borrowers
shall pay over to the Agent for the ratable benefit of the
Lenders, as and for a mandatory prepayment on the Term Notes,
an amount equal to 75% of Excess Cash Flow for the then most
recently completed fiscal year."
2.08. Section 7 of the Credit Agreement shall be amended by adding the
following new Section 7.26 immediately at the end thereof:
"7.26. CAPITAL EXPENDITURES. The Hub Group shall
not expend or become obligated for Capital Expenditures during the fiscal year
ending December 31, 2001 in an aggregate amount in excess of $12,000,000."
3. CONDITIONS PRECEDENT.
The effectiveness of the amendments made in Section 2 of this Amendment
is subject to the satisfaction of all of the following conditions precedent:
3.01. The Borrowers, the Guarantors and the Required Lenders shall
have executed and delivered this Amendment.
3.02. The Senior Note Offering shall have been modified by written
instrument (the "SENIOR NOTE AMENDMENT") in form and substance reasonably
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satisfactory to the Agent and Required Lenders to effect a waiver and
modification of the terms and conditions thereof such that the same are no more
burdensome on the Borrowers than the corresponding provisions of the Credit
Agreement after giving effect to the modifications contemplated by this
Amendment.
3.03. The Agent shall have received copies, executed or certified (as may
be appropriate), of the resolutions or consents of the board of directors or
other governing body of the Borrowers and Guarantors authorizing the execution,
delivery and performance of this Amendment and the Senior Note Amendment,
indicating the authorized signers of this Amendment and the Senior Note
Amendment and the specimen signatures of such signers.
3.04. After giving effect to this Amendment, no Default or Event of
Default (other than amended hereby) shall have occurred and be continuing as of
the date this Amendment would otherwise take effect.
3.05. Legal matters incident to the execution and delivery of this
Amendment and the Senior Note Amendment shall be reasonably satisfactory to the
Agent and its counsel.
4. AMENDMENT FEE.
In consideration of the Lenders' agreements in this Amendment, the
Borrowers shall pay to the Agent for the ratable benefit of the Lenders (in
accordance with their respective Percentages) which have executed and delivered
a counterpart of this Amendment to the Agent no later than 5:00 p.m. (Chicago
time) on November 9, 2000 an amendment fee in an amount equal to 0.2% of such
executing Lenders' Commitments (the "AMENDMENT FEE"), such Amendment Fee to be
fully earned and due and payable to such executing Lenders upon such Lenders'
execution of this Amendment.
5. REPRESENTATIONS.
In order to induce the Lenders to execute and deliver this Amendment,
the Borrowers hereby represent to the Lenders that as of the date hereof, the
representations and warranties set forth in Section 5 of the Credit Agreement
are and remain true and correct in all material respects (except to the extent
the same expressly relate to an earlier date and except that for purposes of
this paragraph the representations contained in Section 5.5 shall be deemed to
refer to the most recent financial statements of the Public Hub Company
delivered to the Lenders) and the Borrowers are in full compliance with all of
the terms and conditions of the Credit Agreement after giving effect to this
Amendment and no Default or Event of Default (other than amended hereby) has
occurred and is continuing under the Credit Agreement or shall result after
giving effect to this Amendment.
6. MISCELLANEOUS.
6.01. Each Borrower and each Guarantor acknowledges and agrees that,
except as modified by this Amendment, all of the Loan Documents to which it is a
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party remain in full force and effect for the benefit and security of, among
other things, the Obligations as modified hereby. Each Borrower and each
Guarantor further acknowledges and agrees that all references in such Loan
Documents to the Obligations shall be deemed a reference to the Obligations as
so modified. Each Borrower and each Guarantor further agrees to execute and
deliver any and all instruments or documents as may be reasonably required by
the Agent or the Required Lenders to confirm any of the foregoing.
6.02. Except as specifically amended hereby, the Credit Agreement shall
continue in full force and effect in accordance with its original terms.
Reference to this specific Amendment need not be made in the Credit Agreement,
the Notes, or any other instrument or document executed in connection therewith,
or in any certificate, letter or communication issued or made pursuant to or
with respect to the Credit Agreement, any reference in any of such items to the
Credit Agreement being sufficient to refer to the Credit Agreement as
specifically amended hereby.
6.03. This Amendment may be executed in any number of counterparts, and
by the different parties on different counterpart signature pages, all of which
taken together shall constitute one and the same agreement. Any of the parties
hereto may execute this Amendment by signing any such counterpart and each of
such counterparts shall for all purposes be deemed to be an original. This
Amendment shall be governed by the internal laws of the State of Illinois.
6.04. The Borrowers agree to pay, jointly and severally, all reasonable
out-of-pocket costs and expenses incurred by the Agent in connection with the
preparation, execution and delivery of this Amendment and the documents and
transactions contemplated hereby, including the reasonable fees and expenses of
counsel for the Agent with respect to the foregoing.
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Dated as of November 7, 2000.
HUB GROUP, INC., a Borrower
HUB CITY TERMINALS, INC., a Borrower
By
Xxxxx X. Xxxxxx
Chief Executive Officer for each of the
above Companies
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GUARANTORS' CONSENT
The undersigned heretofore executed and delivered to the Lenders the
Guaranty Agreement. The undersigned hereby consent to the Amendment to the
Credit Agreement as set forth above and confirm that the Guaranty Agreement and
all of the obligations of the undersigned thereunder remain in full force and
effect. The undersigned further agree that their consent to any further
amendments to the Credit Agreement shall not be required as a result of this
consent having been obtained, except to the extent, if any, required by the
Guaranty Agreement. Without limiting the generality of the foregoing, each of
the undersigned limited liability companies (other than HLX Company, L.L.C.,
Quality Services, L.L.C., Quality Services of Kansas, L.L.C., Quality Services
of New Jersey, L.L.C, Q.S. of Illinois, L.L.C. and Q.S. of Georgia, L.L.C.)
acknowledge and agree that it (i) was previously organized as and is the same
entity as the limited partnership listed in the parenthesis next to its name
below and that executed the Guaranty Agreement and (ii) is liable on the
Guaranty Agreement to the same extent, and with the same force and effect, as if
it had originally executed the Guaranty Agreement in the place and stead of its
respective converting limited partnership.
QUALITY INTERMODAL CORPORATION, a Guarantor
HUB CHICAGO HOLDINGS, INC., a Guarantor
By
Xxxxx X. Xxxxxx
Chief Executive Officer for each of
the above Companies
HLX COMPANY, L.L.C., a Guarantor
By
Xxxxx X. Xxxxxx
Vice Chairman and Chief Executive Officer
QSSC, INC.
QUALITY SERVICES, L.L.C.,
QUALITY SERVICES OF KANSAS, L.L.C.
QUALITY SERVICES OF NEW JERSEY, L.L.C.
Q.S. OF ILLINOIS, L.L.C.
Q.S. OF GEORGIA, L.L.C.
By
Xxxxx X. Xxxxxx
Chief Executive Officer for each of
the above Guarantors
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HUB GROUP ALABAMA, LLC (formerly known as Hub
City Alabama, L.P.)
HUB GROUP ATLANTA, LLC (formerly known as Hub
City Atlanta, L.P.)
HUB GROUP BOSTON, LLC (formerly known as Hub
City Boston, L.P.)
HUB GROUP CANADA, LLC (formerly known as Hub
City Canada, L.P.)
HUB GROUP CLEVELAND, LLC (formerly known as
Hub City Cleveland, L.P.)
HUB GROUP DETROIT, LLC (formerly known as Hub
City Detroit, L.P.)
HUB GROUP FLORIDA, LLC (formerly known as Hub
City Florida, L.P.)
HUB GROUP GOLDEN GATE, LLC (formerly known as
Hub City Golden Gate, L.P.)
HUB GROUP INDIANAPOLIS, LLC (formerly known as
Hub City Indianapolis, L.P.)
HUB GROUP KANSAS CITY, LLC (formerly known as
Hub City Kansas City, L.P.)
HUB GROUP LOS ANGELES, LLC (formerly known as
Hub City Los Angeles, L.P.)
HUB GROUP MID ATLANTIC, LLC (formerly known as
Hub City Mid Atlantic, L.P.)
HUB GROUP NEW ORLEANS, LLC (formerly known as
Hub City New Orleans, L.P.)
HUB GROUP NEW YORK STATE, LLC (formerly known
as Hub City New York State, L.P.)
HUB GROUP NEW YORK-NEW JERSEY, LLC (formerly
known as Hub City New York-New Jersey, L.P.)
HUB GROUP NORTH CENTRAL, LLC (formerly known
as Hub City North Central, L.P.)
HUB GROUP OHIO, LLC (formerly known as Hub
City Ohio, L.P.)
HUB GROUP PHILADELPHIA, LLC (formerly known
as Hub City Philadelphia, L.P.)
HUB GROUP PITTSBURGH, LLC (formerly known as
Hub City Pittsburgh, L.P.)
HUB GROUP PORTLAND, LLC (formerly known as
Hub City Portland, L.P.)
HUB GROUP ST. LOUIS, LLC (formerly known as
Hub City St. Louis, L.P.)
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HUB GROUP TENNESSEE, LLC (formerly known as
Hub City Tennessee, L.P.)
HUB CITY TEXAS, L.P.
By ________________________________________
Xxxxx X. Xxxxxx
Chief Executive Officer for each of the
above Guarantors
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Accepted and agreed to as of the date and year last above written.
XXXXXX TRUST AND SAVINGS BANK
By
Name:______________________________________
Title:_____________________________________
U.S. BANK NATIONAL ASSOCIATION
By
Name:______________________________________
Title:_____________________________________
FIRSTAR BANK, N.A.
By
Name:______________________________________
Title:_____________________________________
LASALLE BANK NATIONAL ASSOCIATION
By
Name:______________________________________
Title:_____________________________________
NATIONAL CITY BANK
By
Name:______________________________________
Title:_____________________________________
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