Form of Amendment to Note Agreement
September __, 1996
Transportation Manufacturing Operations, Inc.
Dial Tower
0000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Re: 9.02% Senior Notes due 2002
Gentlemen:
Reference is made to the Note Agreement (the "Agreement"),
dated as of November 15, 1994, among Transportation Manufacturing
Operations, Inc. (the "Company"), the undersigned and the other
persons named on Schedule A thereto (together with the
undersigned, the "Purchasers"), pursuant to which the Company
issued and sold, and the Purchasers purchased, the Company's
9.02% Senior Notes due November 15, 2002 in the original
principal amount of $125,000,000. Unless otherwise defined
herein, capitalized terms used herein which are defined in the
Agreement shall have the meanings as given in the Agreement.
Pursuant to paragraph 11C of the Agreement and the request
of the Company, and subject to the satisfaction of the conditions
set forth in Section 4 below, the undersigned and the Company
agree as follows:
1. CONSENT. Notwithstanding paragraph 6C(9)(ii) of the
Agreement, the undersigned consent to the payment by the Company
of a dividend in cash of up to $30,000,000 to MCII, provided,
that (a) the payment of such dividend is permitted by clauses (i)
and (iii) of paragraph 6C(9) of the Agreement, (b) such dividend
is paid on or before March 31, 1997 and (c) immediately upon
receipt of such payment, MCII pays a dividend to Grupo Xxxx in
the same amount as the dividend payment made by the Company to
MCII.
2. AMENDMENTS TO AGREEMENT.
2.1. Paragraph 5A is amended by adding the following as new
clauses (iii) and (iv) and by renumbering the existing clauses
(iii), (iv), (v) and (vi) as (v), (vi), (vii) and (viii),
respectively:
(iii) as soon as available and in any event within 60
days after the end of each fiscal quarter (beginning with
the fiscal quarter ending September 30, 1996), the
consolidated balance sheet for Grupo Xxxx and its
consolidated Subsidiaries as at the end of such fiscal
quarter and the related consolidated statements of income
and cash flows of Grupo Xxxx and its consolidated
Subsidiaries for such fiscal quarter and for the period from
the beginning of the then current fiscal year to the end of
such fiscal quarter, setting forth in comparative form the
corresponding figures for the corresponding periods of the
previous fiscal year, all in reasonable detail, provided,
that so long as Grupo Xxxx is a foreign private issuer
complying with reporting requirements under the Exchange
Act, the foregoing requirement shall be satisfied by
delivery of Grupo Dina's quarterly report for such fiscal
quarter on Form 6K thereunder;
(iv) as soon as available and in any event within 120
days after the end of each fiscal year, the consolidated
balance sheet of Grupo Xxxx and its consolidated
Subsidiaries as at the end of such fiscal year and the
related consolidated statements of income, stockholders'
equity and cash flows of Grupo Xxxx and its consolidated
Subsidiaries for such fiscal year, setting forth in
comparative form the corresponding figures for the previous
fiscal year, all in reasonable detail, provided, that so
long as Grupo Xxxx is a foreign private issuer complying
with reporting requirements under the Exchange Act, the
foregoing requirement shall be satisfied by delivery of
Grupo Dina's annual report for such fiscal year on Form 20F
thereunder, and in the case of such consolidated financial
statements of Grupo Xxxx, reports thereon of Xxxxxx Xxxxxxxx
LLP or other independent auditors of recognized national
standing selected by Grupo Xxxx, which reports shall be
unqualified and shall not include any reference to doubts
about the ability of Grupo Xxxx and its Subsidiaries to
continue as a going concern;
2.2. Clause (ii) of paragraph 6C(4) of the Agreement is
amended and restated in its entirety as follows:
(ii) the aggregate amount of all Contingent Liabilities
(excluding performance bonds not to exceed $180,000,000
relating to an order which may be made by The New Jersey
Transit Authority but including the aggregate amount of
coach repurchase contracts described in clause (i)) to
exceed 100% of Consolidated Net Worth, provided, that the
aggregate amount of Contingent Liabilities consisting of (a)
Surety Bonds and outstanding undrawn letters of credit for
the account of the Company or any Restricted Subsidiary
shall not exceed 50% of Consolidated Net Worth and (b)
Residual Value Guarantees and the aggregate amount of coach
repurchase contracts described in clause (i) hereof shall
not exceed 50% of Consolidated Net Worth, in each case
determined as of the end of the most recently completed
fiscal quarter.
2.3. Clause (iii) of paragraph 6C(5) of the Agreement is
amended and restated in its entirety as follows:
(iii) Investments in addition to those set forth in clauses
(i) and (ii) (other than Investments in any Person
controlling, controlled by or under common control with the
Company (other than Restricted Subsidiaries and Investments
in Grupo Xxxx by the Company to the extent such Investments
consist of purchases of motor coaches from Grupo Xxxx for
resale in the United States or Canada ("Permitted Grupo Xxxx
Investments"))), so long as (a) the aggregate original cost
of such Investments, including, without limitation,
Permitted Grupo Xxxx Investments, does not, at any time,
exceed 5% of Consolidated Net Worth and (b) the aggregate
original cost of such Permitted Grupo Xxxx Investments does
not, at any time, exceed 2.5% of Consolidated Net Worth and
all such Permitted Grupo Xxxx Investments are otherwise
permitted by paragraph 6C(7) and
2.4. Clause (iv) of paragraph 6C(5) of the Agreement is
amended by adding immediately after the phrase "Restricted
Subsidiary" and before the parenthetical the phrase "and
Permitted Grupo Xxxx Investments."
2.5. The following is added as a new paragraph 6D:
6D. ADDITIONAL GUARANTORS. The Company covenants not
to permit any Subsidiary to become a guarantor of any of the
obligations of the Company under the Bank Credit Facility or
any other agreement, document or instrument now or hereafter
executed or delivered in connection therewith unless
concurrently therewith such Subsidiary provides to the
holders of the Notes a guarantee of the obligations of the
Company under this Agreement and the Notes pursuant to a
written agreement in form and substance satisfactory to the
Required Holders.
2.6. Paragraph 7A of the Agreement is amended by adding the
following immediately after clause (13) as a new clause (14):
(14) any Guarantor shall fail to perform or observe
any agreement, term or condition contained in, or otherwise
be in default (beyond any applicable grace period) under,
any guarantee agreement in favor of the holders of the
Notes; or any representation or warranty made by any
Guarantor in any such guarantee shall be false in any
material respect as of the date when made; or any such
guarantee shall fail to be in full force and effect or
otherwise shall not be enforceable in accordance with its
terms; or any Guarantor shall contest or deny the validity
or enforceability of, or deny that it has any liability or
obligations under, any such guarantee to which it is a
party;
The last sentence of paragraph 7A is also amended by
deleting the phrase "(12) to (13)" and inserting in lieu thereof
the phrase "(12) to (14)."
2.7. Paragraph 10B of the Agreement is amended as follows:
(a) The following definition is added immediately after the
definition of "Guarantee":
"GUARANTOR" shall mean any Subsidiary that is a party
to any guarantee agreement in favor of the holders of the
Notes with respect to the Company's obligations under this
Agreement and the Notes, including, without limitation, any
Subsidiary that becomes a guarantor pursuant to paragraph
6D.
(b) The definition of "Priority Debt" in paragraph 10B of
the Agreement is amended by adding immediately after
"Intercompany Indebtedness" the phrase "and Guarantees of
Indebtedness under this Agreement and the Notes and Guarantees of
Indebtedness under the Bank Credit Facility."
(c) The following definition is added immediately after the
definition of "Required Holders":
"RESIDUAL VALUE GUARANTIES" means any agreement entered
into by the Company or any of its Subsidiaries to promote
the sales of any bus or coach pursuant to which the Company
or any of its Subsidiaries is guaranteeing at some future
time any minimum value (which may be determined by a
formula) of a bus or coach as specified in such agreement,
the terms and provisions of which agreement are consistent
with the past practices and policies of the Company and its
Subsidiaries prior to September __, 1996.
(c) The definition of "Significant Subsidiary" in paragraph
10B of the Agreement is amended by adding immediately after the
phrase "fiscal year" the phrase ", provided, that for clauses (7)
through (12), inclusive, of paragraph 7A the term "Significant
Subsidiary" shall also mean any Guarantor."
3. REPRESENTATIONS AND WARRANTIES. The Company represents
and warrants as follows: (a) it has all necessary power and
authority to execute and deliver this letter; (b) the execution,
delivery and performance of this letter have been duly authorized
by it; (c) this letter and the Agreement, as amended hereby,
constitute the legal, valid and binding obligations of the
Company and are enforceable against it in accordance with their
terms; (d) the approval, execution, delivery and performance of
the terms hereof do not violate any contractual provision to
which it is a party or by which it is or its properties are bound
or any law applicable to it; (e) all consents, notices, waivers
and other actions by or of the Company or any other Person that
are necessary in connection with the subject matter of the
foregoing consents and amendments have been obtained or taken;
and (f) no Default or Event of Default has occurred and is
continuing.
4. CONDITIONS TO EFFECTIVENESS. The effectiveness of the
consents and amendments herein is subject to satisfaction of the
following conditions (the date upon which such conditions are
satisfied being called the "Effective Date"):
4.1. The undersigned shall have received counterparts to
this letter executed by the Company;
4.2. The undersigned shall have received a Guarantee
Agreement (the "Guarantee") in favor of the holders of the Notes,
in form and substance satisfactory to the undersigned, duly
executed by each Subsidiary that is executing a guarantee
pursuant to the Credit Agreement referred to below (collectively,
the "Guarantors"), and the Guarantee shall be in full force and
effect;
4.3. The undersigned shall have received a favorable
opinion of Xxxxxx & Xxxxxxx, special counsel to the Guarantors,
in form and substance satisfactory to the undersigned, as to the
Guarantee;
4.4. The undersigned shall have received a copy of the
Credit Agreement among the Company, the First National Bank of
Chicago, NBD Bank, N.A. and the other parties thereto (the
"Credit Agreement"), in form and substance satisfactory to the
undersigned, duly executed by each party thereto, and the Credit
Agreement shall be in full force and effect;
4.5. The holders of the Notes and the lenders that are
parties to the Credit Agreement shall have entered into an
Intercreditor Agreement, in form and substance satisfactory to
the undersigned, and such Intercreditor Agreement shall be in
full force and effect;
4.6. The undersigned shall have received copies of duly
executed agreements, in substance identical to this letter
agreement, from holders of the Notes that together with the
undersigned would constitute the Required Holders, and all
conditions to the effectiveness of such agreements shall have
been satisfied.
4.7. The representations and warranties of the Company
contained in Section 3 hereof and of the Guarantors in the
Guarantee shall be true on and as of the Effective Date, after
giving effect to the amendments and other transactions
contemplated by this Agreement; and after giving effect to such
amendments and other transactions there shall exist no Default or
Event of Default.
4.8. The Company shall have paid to the undersigned a
$100,000 amendment fee.
4.9. The Company shall have paid such fees and expenses of
special counsel to the holders of the Notes in connection with
the transactions contemplated hereby as holders of the Notes
shall have requested be paid on or prior to the Effective Date.
4.10. The transactions contemplated by this letter shall not
violate any applicable law or governmental regulation and shall
not subject the undersigned to any tax, penalty, liability or
other onerous condition under or pursuant to any applicable law
or governmental regulation, and the undersigned shall have
received such certificates or other evidence as may be requested
to establish compliance with this condition.
4.11. All corporate and legal proceedings and all
instruments and agreements in connection with the transactions
contemplated by this letter shall be reasonably satisfactory in
form and substance to the undersigned and its counsel, and the
undersigned shall have received all information and copies of all
documents and papers, including records of corporate and
governmental proceedings, which the undersigned may reasonably
have requested in connection therewith, such documents and papers
when appropriate to be certified by proper corporate or
governmental authorities.
5. MISCELLANEOUS.
5.1. Upon the Effective Date, each reference in the
Agreement to "this Agreement," "hereunder," "hereof," "herein" or
words of like import shall mean and be a reference to the
Agreement as amended hereby and each reference to the Agreement
in the Notes shall mean and be a reference to the Agreement, as
amended hereby.
5.2. This letter shall be construed and enforced in
accordance with, and the rights of the parties shall be governed
by, the internal law of the State of New York.
5.3. Except as specifically amended above, the Agreement and
the Notes shall remain in full force and effect and are hereby
ratified and confirmed. The execution, delivery and
effectiveness of this letter shall not, except as expressly
provided herein, operate as an amendment to any provision of the
Agreement nor a waiver of any right, power or remedy of any
holder of a Note, nor constitute a waiver of, or consent to any
departure from, any provision of the Agreement or any Note.
5.4. This letter may be executed by one or more of the
parties to this letter on any number of separate counterparts and
all of said counterparts taken together shall be deemed to
constitute one and the same instrument.
Please acknowledge the foregoing and your agreement thereto
by signing this letter agreement where indicated below.
Very truly yours,
By: ________________________
Title:______________________
By: ________________________
Title:______________________
Accepted and Agreed to
as of the date written above:
TRANSPORTATION MANUFACTURING OPERATIONS, INC.
By:____________________
Title:_________________
