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HUB GROUP, INC.
and
HUB CITY TERMINALS, INC.
-----------------------------------
FIRST AMENDMENT
Dated as of February 26, 2001
to
NOTE PURCHASE AGREEMENTS
Dated as of June 15, 1999
-----------------------------------
Re: $50,000,000 8.64% Senior Notes
Due June 25, 2009
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FIRST AMENDMENT TO NOTE PURCHASE AGREEMENTS
THIS FIRST AMENDMENT dated as of February 26, 2001 (the or this "FIRST
AMENDMENT") to the Note Purchase Agreements each dated as of June 15, 1999 is
between HUB GROUP, INC., a Delaware corporation ("PUBLIC HUB COMPANY"), HUB CITY
TERMINALS, INC., a Delaware corporation, for itself and as successor by merger
to Hub Holdings, Inc. ("HUB CHICAGO"; Public Hub Company and Hub Chicago being
individually referred to herein as an "OBLIGOR" and collectively as the
"OBLIGORS"), and each of the institutions which is a signatory to this First
Amendment (collectively, the "NOTEHOLDERS").
RECITALS:
A. The Obligors and each of the Noteholders have heretofore entered
into separate and several Note Purchase Agreements each dated as of June 15,
1999 (collectively, the "NOTE PURCHASE AGREEMENTS"). The Obligors have
heretofore issued the $50,000,000 8.64% Senior Notes Due June 25, 2009 (the
"NOTES") dated June 25, 2000 pursuant to the Note Purchase Agreements.
B. The Obligors and the Noteholders now desire to amend the Note
Purchase Agreements in the respects, but only in the respects, hereinafter set
forth.
C. Capitalized terms used herein shall have the respective meanings
ascribed thereto in the Note Purchase Agreements unless herein defined or the
context shall otherwise require.
D. All requirements of law have been fully complied with and all other
acts and things necessary to make this First Amendment a valid, legal and
binding instrument according to its terms for the purposes herein expressed have
been done or performed.
NOW, THEREFORE, upon the full and complete satisfaction of the
conditions precedent to the effectiveness of this First Amendment set forth in
Section 3.1 hereof, and in consideration of good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged, the Obligors and the
Noteholders do hereby agree as follows:
SECTION 1. AMENDMENTS.
SECTION 1.1. A new definition of Capital Expenditures shall be added in
alphabetical order in Schedule B to the Note Purchase Agreements to read as
follows:
"CAPITAL EXPENDITURES" shall mean for any period, the
aggregate of all expenditures (whether paid in cash or accrued as a
liability) of the Public Hub Company and its Restricted Subsidiaries
during that period which, in accordance with GAAP are or should be
included in "additions to property, plant or equipment" or similar
items reflected in the statement of cash flows of the Public Hub
Company and its Restricted Subsidiaries.
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SECTION 1.2. The definition of "CONSOLIDATED EBITDA" appearing in
Schedule B to the Note Purchase Agreements shall be amended and restated in its
entirety to read as follows:
"CONSOLIDATED EBITDA" for any period means the sum of (a)
Consolidated Net Income during such period PLUS (to the extent deducted
in determining Consolidated Net Income), (b) all provisions for any
Federal, state or local income taxes made by the Public Hub Company and
the Restricted Subsidiaries during such period, (c) all provisions for
depreciation and amortization (other than amortization of debt
discount) made by the Public Hub Company and the Restricted
Subsidiaries during such period, (d) Consolidated Interest Expense
during such period, (e) Minority Interest Expense, (f) 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 Public Hub Company and its Restricted
Subsidiaries in accordance with GAAP aggregating up to $5,100,000 (for
both such quarters taken together), (g) all other non-cash charges
during such period on the books of the Public Hub Company and its
Restricted Subsidiaries 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), (h) 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) and (i) 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 (h)
above) made during such quarters aggregating up to $600,000 (for all
four such quarters taken together). For purposes of calculations under
SECTION 10.3, Consolidated EBITDA shall be adjusted for the period in
respect of which any such calculation is being made to give effect to
(i) the audited "EBITDA" (determined in a manner consistent with the
definition of "Consolidated EBITDA" contained in this Agreement) of any
business entity acquired by the Public Hub Company or any Restricted
Subsidiary (the "ACQUIRED BUSINESS") and (ii) all Debt incurred by the
Public Hub Company or any Restricted Subsidiary in connection with such
acquisition, and shall be computed as if the Acquired Business had been
a Restricted Subsidiary throughout the period and all Debt incurred in
connection with such acquisition had been incurred at the beginning of
such period in respect of which such calculation is being made. Without
limiting the foregoing, Consolidated EBITDA shall also be adjusted for
the period in respect of which any such calculation is being made to
eliminate (1) the audited "EBITDA" of any Subsidiary or other property
or assets disposed of by the Public Hub Company or any Restricted
Subsidiary (the "TRANSFERRED BUSINESS") and (2) Debt relating to such
Subsidiary, property or assets, as the case may be, and shall be
computed as if the Transferred Business had been transferred at the
beginning of such period in respect of which such calculation is being
made. In the case of any business entity acquired during the twelve
calendar month period immediately preceding the date of any
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determination hereunder whose financial records are not, and are not
required to be in accordance with applicable laws, rules and
regulations, audited by the Public Hub Company's independent public
accountants at the time of the acquisition thereof, the Public Hub
Company shall base such determination upon the Public Hub Company's
internally audited net earnings of such business entity for the
immediately preceding fiscal year or the net earnings of such business
entity as audited by such business entity's independent auditors for
the immediately preceding fiscal year.
SECTION 1.3. The definition of "CONSOLIDATED EBITDAR" appearing in
Schedule B to the Note Purchase Agreements shall be amended and restated in its
entirety to read as follows:
"CONSOLIDATED EBITDAR" for any period means the sum of (a)
Consolidated Net Income during such period, PLUS (to the extent
deducted in determining Consolidated Net Income) (b) all provisions for
any Federal, state or local income taxes made by the Public Hub Company
and the Restricted Subsidiaries during such period, (c) all provisions
for depreciation and amortization (other than amortization of debt
discount) made by the Public Hub Company and the Restricted
Subsidiaries during such period, (d) Consolidated Interest Expense
during such period, (e) all Rentals (other than Rentals on Capital
Leases) payable during such period by the Public Hub Company and the
Restricted Subsidiaries, (f) Minority Interest Expense, (g) 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 Public Hub Company and its Restricted
Subsidiaries in accordance with GAAP aggregating up to $5,100,000 (for
both such quarters taken together), (h) all other non-cash charges
during such period on the books of the Public Hub Company and its
Restricted Subsidiaries 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), (i) 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) and (j) 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 (i)
above) made during such quarters aggregating up to $600,000 (for all
four such quarters taken together). Consolidated EBITDAR shall not be
adjusted to take into account earnings or interest of an Acquired
Business that were earned or accrued prior to its becoming an Acquired
Business.
SECTION 1.4. The definition of "CONSOLIDATED INTEREST EXPENSE"
appearing in Schedule B to the Note Purchase Agreements shall be amended and
restated in its entirety to read as follows:
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"CONSOLIDATED INTEREST EXPENSE" means for any period all
interest (including the interest component on Rentals on Capital
Leases) and all amortization of debt discount and expense on any
particular Debt (including, without limitation, payment-in-kind, zero
coupon and other like Securities) of the Public Hub Company and the
Restricted Subsidiaries for which such calculations are being made.
Computations of Consolidated Interest Expense on a PRO-FORMA basis for
Debt having a variable interest rate shall be calculated at the rate in
effect on the date of any determination.
SECTION 1.5. Section 10.3 of the Note Purchase Agreements shall be
amended and restated in its entirety to read as follows:
"SECTION 10.3. CASH FLOW LEVERAGE RATIO. The Public Hub Company and its
Restricted Subsidiaries will not, as of the close of each fiscal
quarter specified below, permit the ratio of Consolidated Debt to
Consolidated EBITDA for the immediately preceding four consecutive
fiscal quarter period to exceed the ratios set forth below:
CONSOLIDATED DEBT TO
AS OF THE FISCAL QUARTER CONSOLIDATED EBITDA
ENDING ON: SHALL NOT BE MORE THAN:
December 31, 2000 3.85 to 1.00
March 31, 2001 3.75 to 1.00
June 30, 2001 3.75 to 1.00
September 30, 2001 3.50 to 1.00
December 31, 2001 3.25 to 1.00
March 31, 2002 3.25 to 1.00
June 30, 2002 3.00 to 1.00
September 30, 2002 3.00 to 1.00
December 31, 2002 2.75 to 1.00
March 31, 2003 2.75 to 1.00
June 30, 2003 and thereafter 2.50 to 1.00"
SECTION 1.6. Section 10.2 of the Note Purchase Agreements shall be
amended and restated in its entirety to read as follows:
"SECTION 10.2. FIXED CHARGE COVERAGE RATIO. The Public Hub Company and
its Restricted Subsidiaries will not, as of close of each fiscal
quarter specified below, permit the ratio of (a) Consolidated EBITDAR
for the immediately preceding four consecutive fiscal quarter period to
(b) Consolidated Fixed Charges as of such date to be less than (i) 1.25
to 1.00 as of the end of the fiscal quarters ending March 31, 2001,
June 30, 2001 and September 30, 2001, and (ii) 1.30 to 1.00 as of the
close of each fiscal quarter thereafter."
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SECTION 1.7. Section 10.6(b)(i) of the Note Purchase Agreements shall
be amended and restated in its entirety to read as follows:
"(i) the sale, lease, transfer or other disposition of
assets of a Restricted Subsidiary to any Obligor or a Wholly-owned Restricted
Subsidiary or of an Obligor to any other Obligor; or"
SECTION 1.8. Section 10 of the Note Purchase Agreements shall be
amended by adding thereto a new Section 10.10 to read as follows:
"SECTION 10.10. CAPITAL EXPENDITURES. The Public Hub Company and its
Restricted Subsidiaries 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 and shall not expend or
become obligated for Capital Expenditures during the fiscal year ending
December 31, 2002 in an aggregate amount in excess of $15,000,000."
SECTION 1.9. From and after December 31, 2000 interest on the Notes
shall accrue at the rate of 9.14% per annum in lieu of 8.64% per annum and the
overdue rate on any overdue payment (including any overdue prepayment) of
principal, any overdue payment of interest and any overdue payment of any
Make-Whole Amount at a rate per annum from time to time equal to the greater of
(i) 11.14% per annum or (ii) 2% over the rate of interest publicly announced by
Xxxxxx Trust and Savings Bank, Chicago, Illinois from time to time as its "base"
or "prime" rate.
SECTION 2. REPRESENTATIONS AND WARRANTIES OF THE OBLIGORS.
SECTION 2.1. To induce the Noteholders to execute and deliver this
First Amendment (which representations shall survive the execution and delivery
of this First Amendment), the Obligors, jointly and severally, represent and
warrant to the Noteholders that:
(a) this First Amendment has been duly authorized, executed
and delivered by each Obligor and this First Amendment constitutes the
legal, valid and binding obligation, contract and agreement of each
Obligor enforceable against it in accordance with its terms, except as
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws or equitable principles relating to or
limiting creditors' rights generally;
(b) the Note Purchase Agreements, as amended by this First
Amendment, constitute the legal, valid and binding obligations,
contracts and agreements of the Obligors enforceable against them in
accordance with their respective terms, except as enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws or equitable principles relating to or limiting creditors'
rights generally;
(c) the execution, delivery and performance by the Obligors
of this First Amendment (i) has been duly authorized by all requisite
corporate action and, if required, shareholder action, (ii) does not
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require the consent or approval of any governmental or regulatory body
or agency, and (iii) will not (A) violate (1) any provision of law,
statute, rule or regulation or its certificate of incorporation or
bylaws, (2) any order of any court or any rule, regulation or order of
any other agency or government binding upon it, or (3) any provision of
any material indenture, agreement or other instrument to which any
Obligor is a party or by which any Obligor's properties or assets are
or may be bound, including, without limitation, the Credit Agreement
dated as of April 30, 1999, among the Obligors, the Lenders party
thereto and Xxxxxx Trust and Savings Bank, individually and as Agent,
and all amendments, supplements and modifications thereto, or (B)
result in a breach or constitute (alone or with due notice or lapse of
time or both) a default under any indenture, agreement or other
instrument referred to in clause (iii)(A)(3) of this Section 2.1(c);
(d) as of the date hereof and after giving effect to this
First Amendment, no Default or Event of Default has occurred which is
continuing;
(e) all the representations and warranties contained in
Section 5 of the Note Purchase Agreements (other than those contained
in Sections 5.3, 5.4(a), 5.4(b) and 5.9) are true and correct in all
material respects with the same force and effect as if made by the
Obligors on and as of the date hereof (other than any representation
and warranty that expressly relates to a specified earlier date, which
was true and correct in all material respects as of such date);
PROVIDED, THAT, notwithstanding any reference in Sections 5.4(c) and
5.4(d) of the Note Purchase Agreements to the Restricted Subsidiaries
listed on Schedule 5.4 to the Note Purchase Agreements, the
representations and warranties hereby made by the Obligors with
reference to Sections 5.4(c) and 5.4(d) of the Note Purchase Agreements
shall relate to the Restricted Subsidiaries existing on the date
hereof;
(f) The statements and information furnished to the
Noteholders in connection with the negotiation of this Amendment do
not, taken as a whole, and other than financial projections or
forecasts, contain any untrue statements of a material fact or omit a
material fact necessary to make the material statements contained
herein or therein not misleading, the Noteholders acknowledging that as
to any projections furnished to the Noteholders, the Obligors and the
Constituent Company Guarantors only represent that the same were
prepared on the basis of information and estimates the Obligors
believed to be reasonable; and
(g) All tax returns with respect to any income tax or other
material tax required to be filed by the Obligors and the Restricted
Subsidiaries in any jurisdiction have, in fact, been filed, and all
taxes, assessments, fees and other governmental charges upon the
Obligors or the Restricted Subsidiaries or upon any of their respective
properties, income or franchises, which are shown to be due and payable
in such returns, have been paid. The Obligors do not know of any
proposed additional tax assessment against the Obligors or any
Restricted Subsidiary for which adequate provision in accordance with
GAAP has not been made. Adequate provisions in accordance with GAAP for
taxes on the books of the Obligors and each Restricted Subsidiary have
been made for all open years, and for its current fiscal period.
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SECTION 3. CONDITIONS TO EFFECTIVENESS OF THIS FIRST AMENDMENT.
SECTION 3.1. This First Amendment shall not become effective until, and
shall become effective when, each and every one of the following conditions
shall have been satisfied:
(a) executed counterparts of this First Amendment, duly
executed by the Obligors and the holders of at least 51% of the
outstanding principal of the Notes, shall have been delivered to the
Noteholders;
(b) the Noteholders shall have received a copy of the
resolutions of the Board of Directors of each Obligor authorizing the
execution, delivery and performance by such Obligor of this First
Amendment, certified by such Obligor's Secretary or an Assistant
Secretary;
(c) the representations and warranties of the Obligors set
forth in Section 2 hereof are true and correct on and with respect to
the date hereof; and
(d) the Noteholders shall have received the favorable opinion
of counsel to the Obligors as to the matters set forth in Sections
2.1(a), 2.1(b) and 2.1(c) hereof, which opinion shall be in form and
substance satisfactory to the Noteholders.
Upon receipt of all of the foregoing, this First Amendment shall become
effective as of December 31, 2000.
SECTION 4. PAYMENT OF NOTEHOLDERS' COUNSEL FEES AND EXPENSES.
SECTION 4.1. The Obligors agrees to pay upon demand, the reasonable
fees and expenses of Xxxxxxx and Xxxxxx, counsel to the Noteholders, in
connection with the negotiation, preparation, approval, execution and delivery
of this First Amendment.
SECTION 5. MISCELLANEOUS.
SECTION 5.1. This First Amendment shall be construed in connection with
and as part of each of the Note Purchase Agreements, and except as modified and
expressly amended by this First Amendment, all terms, conditions and covenants
contained in the Note Purchase Agreements and the Notes are hereby ratified and
shall be and remain in full force and effect.
SECTION 5.2. Any and all notices, requests, certificates and other
instruments executed and delivered after the execution and delivery of this
First Amendment may refer to the Note Purchase Agreements without making
specific reference to this First Amendment but nevertheless all such references
shall include this First Amendment unless the context otherwise requires.
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SECTION 5.3. The descriptive headings of the various Sections or parts
of this First Amendment are for convenience only and shall not affect the
meaning or construction of any of the provisions hereof.
SECTION 5.4. This First Amendment shall be governed by and construed in
accordance with Illinois law.
SECTION 5.5. The execution hereof by you shall constitute a contract
between us for the uses and purposes hereinabove set forth, and this First
Amendment may be executed in any number of counterparts, each executed
counterpart constituting an original, but all together only one agreement.
[Signature Pages Begin on Next Page]
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IN WITNESS WHEREOF, the Obligors and the Noteholders have caused this
instrument to be executed this February 26, 2001.
HUB GROUP, INC.
HUB CITY TERMINALS, INC.
By
Xxxxx X. Xxxxxx
Chief Executive Officer for each of the
above Companies
Consented, Accepted and Agreed
this February 26, 2001
HUB CHICAGO HOLDINGS, INC., a Constituent
Company Guarantor
By
Xxxxx X. Xxxxxx
Chief Executive Officer for each of the
above Companies
HLX COMPANY, L.L.C., a Constituent
Company 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 Constituent Company Guarantors
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, 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.)
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 Constituent Company Guarantors
Consented, Accepted and Agreed
this February 26, 2001:
BAYSTATE HEALTH SYSTEM, INC.
By: Xxxxx X. Xxxxxx & Company Inc. as
Investment Adviser
By___________________________________
Name:
Title:
Consented, Accepted and Agreed
this February 26, 2001:
C.M. LIFE INSURANCE COMPANY
By: Xxxxx X. Xxxxxx & Company Inc. as
Investment Sub-Adviser
By___________________________________
Name:
Title:
Consented, Accepted and Agreed
this February 26, 2001:
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
By: Xxxxx X. Xxxxxx & Company Inc., as
Investment Adviser
By___________________________________
Name:
Title:
Consented, Accepted and Agreed
this February 26, 2001:
INVESTORS PARTNER LIFE INSURANCE COMPANY
By___________________________________
Name:
Title:
Consented, Accepted and Agreed
this February 26, 2001:
XXXX XXXXXXX LIFE INSURANCE COMPANY
By___________________________________
Name:
Title:
Consented, Accepted and Agreed
this February 26, 2001:
XXXX XXXXXXX VARIABLE LIFE INSURANCE
COMPANY
By___________________________________
Name:
Title:
Consented, Accepted and Agreed
this February 26, 2001:
MELLON BANK, N.A., solely in its capacity
as Trustee for the Xxxx Atlantic
Master Trust (as directed by Xxxx
Xxxxxxx Financial Services, Inc.), and
not in its individual capacity
By___________________________________
Name:
Title:
Consented, Accepted and Agreed
this February 26, 2001:
ING INVESTMENT MANAGEMENT LLC, as agent
on behalf of ReliaStar Life Insurance
Company
By___________________________________
Name:
Title:
Consented, Accepted and Agreed
this February 26, 2001:
ING INVESTMENT MANAGEMENT LLC, as
agent on behalf of ReliaStar Life
Insurance Company of New York
By___________________________________
Name:
Title:
Consented, Accepted and Agreed
this February 26, 2001:
UNITED OF OMAHA LIFE INSURANCE COMPANY
By___________________________________
Name:
Title:
