Exhibit 10.11(a)
AMENDMENT TO AMENDED AND RESTATED LOAN AGREEMENT
This Amendment to Amended and Restated Loan Agreement ("Amendment"),
dated as of May 5, 2005 is between CAROLINA NATIONAL TRANSPORTATION INC., an
Indiana corporation ("Carolina"); GULF LINE TRANSPORT INC., an Indiana
corporation ("Gulf Line"); FIVE STAR TRANSPORT, INC., an Indiana corporation
("Five Star"); Cam TRANSPORT, INC., an Indiana corporation ("CAM"); UNITY
LOGISTIC SERVICES INC., an Indiana corporation ("Unity"); ERX, INC., an
Indiana corporation ("ERX"); FRIENDLY TRANSPORT, INC., an Indiana corporation
("Friendly"); TRANSPORT LEASING, INC., an Arkansas corporation ("Transport
Leasing"); HARBOR BRIDGE INTERMODAL, INC., an Indiana corporation ("Harbor");
PATRIOT LOGISTICS, INC., an Indiana corporation ("Patriot"); LIBERTY TRANSPORT,
INC., an Indiana corporation ("Liberty"); and KEYSTONE LINES CORPORATION, a
California corporation ("Keystone"), (Carolina, Gulf Line, Five Star, CAM,
Unity, ERX, Friendly, Transport Leasing, Harbor, Patriot, Liberty, and
Keystone are hereinafter each referred to each as a "Borrower Entity", and
collectively as the "Borrower"); US 1 INDUSTRIES, INC., an Indiana
corporation ("Guarantor"); and U.S. BANK NATIONAL ASSOCIATION, a national
banking association ("Lender"). Capitalized terms not defined herein have
the meanings ascribed to them in the Loan Agreement, as that term is defined
herein.
PRELIMINARY STATEMENT:
All Borrower Entities have previously entered into an Amended and
Restated Loan Agreement with Lender dated as of March 10, 2005 (the
"Existing Loan Agreement," and, as amended by this Amendment, the "Loan
Agreement").
Lender has agreed to amend the Existing Loan Agreement to do the
following: (i) waive events of default relating to Borrower's failure to
comply with certain financial covenants arising out of the Cam Transport
Judgment, as that term is defined herein; (ii) make corresponding adjustments
to the provisions used to calculate collateral availability, set interest rate
pricing, and determine compliance with financial covenants; and (iii) provide
for other matters, as set forth herein.
NOW, THEREFORE, it is hereby agreed as follows:
1. Each of Borrowers and Guarantor represent and warrant that except for the
Events of Default waived by Lender pursuant to Section 4 of this Amendment, no
Event of Default, except for those Events of Default waived by Section 4 of
this Amendment, or Incipient Default exists or will occur as a result of the
execution of and performance under this Amendment to Amended and Restated Loan
Agreement and that each of their representations and warranties set forth in
the Loan Instruments (as the definition of that term is amended by this
Amendment) is true and correct as of the date hereof, except to the extent
that any such representations or warranties speak exclusively to an earlier
date.
2. New definitions are added to Section 1.1 of the Existing Loan Agreement
as follows:
"Cam Transport Judgment: that certain judgment in the amount of
$1,700,000 entered against Cam on March 16, 2005, by the Court of Commons
Pleas of Allendale County, South Carolina, in the case styled Xxxx Bennnett
vs. Xxxx X. Xxxxxxxx and Cam Transport, Inc., Case No. 03-CP."
"Cam Transport Judgment Adjustment: an adjustment to the otherwise
applicable financial statements of Borrower, solely for the purposes of:
(1) calculating Eligible Accounts Receivable under; (2) setting interest
rate pricing under; and (3) determining compliance with the financial
covenants contained in, this Agreement, which adjustment: (1) reverses the
Cam Transport Judgment Reserve for the calendar quarter ended December 31,
2004 and all subsequent calendar quarters for which the Cam Transport
Judgment remains unsatisfied; and (2) adds as an expense of Borrower the
amount of $1,700,000 (or such lesser amount as is actually required to
satisfy the Cam Transport Judgment), for the calendar quarter during which
the Cam Transport Judgment is satisfied or nullified on appeal or otherwise."
"Cam Transport Judgment Reserve: a reserve and related expense
appearing in the financial statements of Borrower in the amount of $1,700,000,
with respect to the Cam Transport Judgment."
3. The following definitions in Section 1.1 of the Existing Loan Agreement
are amended and restated in their entirety as follows:
"Eligible Accounts Receivable: (1) The total amount of the Accounts
from completed transactions after deducting (i) Accounts over 75 days past
invoice date; (ii) intercompany Accounts; (iii) foreign Accounts; (iv) Accounts
to the extent subject to customer setoffs; (v) Accounts for which the portion
of the Account aged 75 days past the invoice date is in excess of 50% of the
total indebtedness owed to any of the Borrower Entities by the account debtor;
(vi) Accounts for which the account debtor is a Governmental Body, except those
for which the account debtor is the government of the United States of America,
or any department, commission, board, bureau, agency, public authority or
instrumentality thereof and with respect to which all conditions to the pledge
of and perfection of a first lien interest in such Accounts under the federal
Assignment of Claims Act codified as 41 USC 15 and 31 USC 3727, as amended, on
terms satisfactory to Lender, have been satisfied; and (vii) such other reserves
as Lender may reasonably deem appropriate, less, only until such time as the
Cam Transport Judgment is satisfied, (2) $1,700,000."
"Loan Instruments:
(i) Loan Agreement;
(ii) Revolving Loan Note;
(iii) Corporate Guaranty;
(iv) Security Instruments;
(v) Closing Certificate;
(vi) Subordination Agreements;
(vii) Personal Guaranties;
(viii) Reaffirmations of Personal Guaranties;
(ix) Corporate Guaranty;
(x) Reaffirmation of Corporate Guaranty;
(xi) Standby Letter of Credit;
(xii) Application and Agreement for Standby Letter of Credit;
(xiii) Continuing Reimbursement Agreement for Standby Letters of Credit; and
(xiv) such other instruments and documents as Lender may reasonably require
in connection with the transactions contemplated by this Loan
Agreement; as the same may be amended and/or restated from time to
time, including without limitation as amended by or pursuant to that
certain Amended and Restated Loan Agreement dated March, 10, 2005, by
and between the parties hereto, as amended by that certain Amendment to
Amended and Restated Loan Agreement dated May 5, 2005."
4. Section 1.8 of the Existing Loan Agreement is amended and restated in
its entirety as follows:
"1.8 Waiver of Certain Defaults.
The Loan Agreement requires that Borrower not permit the ratio of
Unsubordinated Debt to EBITDA to exceed 3.25 to 1 for the last four (4)
calendar quarters. During the four quarters ended March 31, 2005, Borrower
allowed said ratio to exceed 3.25 to 1, owing to the Cam Transport Judgment
Reserve. The Loan Agreement also requires that Borrower not permit its debt
service ratio to be less than 1.25:1 on a rolling four (4) quarter average.
During the four quarters ended December 31, 2004, Borrower allowed said ratio
to be less than 1.25 to 1, also owing to the Cam Transport Judgment Reserve.
Notwithstanding the terms of the Loan Agreement, Lender hereby waives the
foregoing Events of Default, without waiving its right strictly to enforce
the terms of the Loan Documents in the future."
5. The last sentence of Section 2.3.1 of the Existing Loan Agreement is amended
and restated in its entirety as follows:
"For the purposes of this Section 2.3.1, EBITDA shall be determined based on a
rolling four (4) quarter average, subject to the Cam Transport Judgment
Adjustment for any period to which it is applicable."
6. Section 7.21 of the Existing Loan Agreement is amended and restated in its
entirety as follows:
"7.21 Testing of Financial Covenants.
All of the financial covenants set forth in Sections 7.16 though 7.20 shall be
fully satisfied by Guarantor and Borrower on a quarterly reporting basis, and
shall take into account the Cam Judgment Adjustment for any period to which it
is applicable."
7. Simultaneously with the execution hereof, Borrowers and Guarantor shall
deliver to Lender the following, duly executed by the parties thereto other
than Lender:
(i) Reaffirmations of Personal Guaranties of Xxxxxxx Xxxxxx and Xxxxxx Xxxxxxxx,
in the forms attached hereto as Exhibits A-1 and A-2;
(ii) Reaffirmation of Corporate Guaranty of Guarantor, in the form attached
hereto as Exhibit B;
(iii) Acknowledgements of the holders of Subordinated Indebtedness of, (1)
the execution of this Amended and Restated Loan Agreement; (2) the continued
effectiveness of those certain Subordination Agreements by and between Lender
and, (a) Xxxxxx Xxxxxxxx and Xxxxxxx Xxxxxx, dated as of April 18, 2000, as
amended pursuant to that certain Amendment to Subordination Agreement dated as
of August 1, 2002, and (b) August Investment Partnership, as amended and
restated pursuant to that certain Amended and Restated Subordination Agreement
dated as of August 1, 2002 (collectively, as so amended, the "Subordination
Agreements"), in the forms attached hereto as Exhibits C-1 and C-2; and
(iv) A legal opinion from Borrower's counsel, Xxxxxxxx Xxxxxxx, LLP, in a form
reasonably satisfactory to Lender's counsel regarding the Borrower's and the
Guarantor's authorization, execution and delivery of this Amendment, dated as
of the date hereof, and the documents referenced herein to which Borrower and/
or Guarantor are a party, and the incorporation or organization, as the case
may be, and the good standing, of each Borrower and of the Guarantor as of the
date hereof.
8. All references to the "Loan Agreement" and other terms defined in the
Existing Loan Agreement shall be deemed to take account of the Existing Loan
Agreement, as amended by this Amendment.
9. Borrowers shall pay Lender a fee in the amount of $25,000, being 0.25% of
the Revolving Loan Commitment, simultaneously with the execution of this
Amendment, and shall reimburse Lender for all of Lender's out-of-pocket costs
related to the transaction contemplated herein, including without limitation
public record searches ordered by Lender or its counsel and legal fees incurred
by Lender in connection with the preparation of documents, due diligence review
or closing regarding the transaction contemplated herein or the enforcement of
the terms hereof or of any of the Loan Instruments.
10. From time to time, Borrowers and Guarantor shall execute and deliver to
Lender such additional documents as Lender reasonably may require to carry out
the purposes of this Amendment and the Loan Instruments and to protect Lender's
rights hereunder and thereunder, and shall not take any action inconsistent with
the purposes of the Loan Instruments.
11. Except as expressly amended hereby, the terms and conditions of the Existing
Loan Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the undersigned Borrowers, Lender, and Guarantor have signed
this Amendment to Amended and Restated Loan Agreement as of the date first above
written.
CAROLINA NATIONAL TRANSPORTATION INC., an Indiana corporation
By: /s/ Xxxxxxx X. Xxxxxx
_________________________
Name: Xxxxxxx X. Xxxxxx
Title: President
GULF LINE TRANSPORT INC.,
an Indiana corporation
By: /s/ Xxxxxxx X. Xxxxxx
__________________________
Name: Xxxxxxx X. Xxxxxx
Title: President
FIVE STAR TRANSPORT, INC.,
an Indiana corporation
By: /s/ Xxxxxxx X. Xxxxxx
_________________________
Name: Xxxxxxx X. Xxxxxx
Title: President
CAM TRANSPORT, INC.,
an Indiana corporation
By: /s/ Xxxxxxx X. Xxxxxx
_________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
UNITY LOGISTIC SERVICES INC.,
an Indiana corporation
By: /s/ Xxxxxxx X. Xxxxxx
_________________________
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
ERX, INC., an Indiana corporation
By: /s/ Xxxxxxx X. Xxxxxx
_________________________
Name: Xxxxxxx X. Xxxxxx
Title: Secretary
FRIENDLY TRANSPORT, INC.,
an Indiana corporation
By: /s/ Xxxxxxx X. Xxxxxx
_________________________
Name: Xxxxxxx X. Xxxxxx
Title: President
TRANSPORT LEASING, INC.,
an Arkansas corporation
By: /s/ Xxxxxxx X. Xxxxxx
_________________________
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
HARBOR BRIDGE INTERMODAL, INC.,
an Indiana corporation
By: /s/ Xxxxxxx X. Xxxxxx
_________________________
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
PATRIOT LOGISTICS, INC.,
an Indiana corporation
By: /s/ Xxxxxxx X. Xxxxxx
_________________________
Name: Xxxxxxx X. Xxxxxx
Title: President
LIBERTY TRANSPORT, INC.,
an Indiana corporation
By: /s/ Xxxxxxx X. Xxxxxx
_________________________
Name: Xxxxxxx X. Xxxxxx
Title: President
KEYSTONE LINES CORPORATION,
an Indiana corporation
By: /s/ Xxxxxxx X. Xxxxxx
_________________________
Name: Xxxxxxx X. Xxxxxx
Title: President
US 1 INDUSTRIES, INC., an Indiana corporation
By: /s/ Xxxxxxx X. Xxxxxx
_________________________
Name: Xxxxxxx X. Xxxxxx
Title: President
U.S. BANK NATIONAL ASSOCIATION,
a national banking association
By: /s/ Xxxxx X. Xxxxxxxxx
___________________________
Name: Xxxxx X. Xxxxxxxxx
Title: Senior Vice President
