Exhibit 10.04
SEVENTH AMENDMENT TO LETTER OF CREDIT AGREEMENTS
THIS SEVENTH AMENDMENT TO LETTER OF CREDIT AGREEMENTS
(this "Amendment"), is made and entered into as of January 18,
2002 (the "Effective Date"), by and between CONSOLIDATED
FREIGHTWAYS CORPORATION, a Delaware corporation ("Debtor"), the
other Credit Parties signatory to the Letter of Credit Agreements
described below (collectively, together with the Debtor, the
"Credit Parties") and GENERAL ELECTRIC CAPITAL CORPORATION, a
Delaware corporation ("GE Capital").
W I T N E SS E T H:
WHEREAS, Debtor and GE Capital are parties to that
certain Letter of Credit Agreement, dated as of April 27, 2001
(as amended to the date hereof, the "Letter of Credit Agreement";
capitalized terms used herein and not otherwise defined herein
shall have the meanings given such terms in the Letter of Credit
Agreement), pursuant to which GE Capital has committed to make
certain letters of credit available to Debtor; and
WHEREAS, Debtor, the other Credit Parties and GE
Capital desire to modify the Letter of Credit Agreement in
certain respects, all in accordance with and subject to the terms
and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises, the
covenants and agreements contained herein, and other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Debtor, the other Credit Parties and GE
Capital do hereby agree that all capitalized terms used herein
shall have the meanings ascribed thereto in the Letter of Credit
Agreement (except as otherwise expressly defined or limited
herein) and do hereby further agree as follows:
1. Waiver. Subject to the terms and conditions of this
Amendment, including without limitation the fulfillment of the
conditions to effectiveness specified in Section 7 below, the
Creditor hereby waives the minimum Excess Liquidity requirements
in clauses (i)(A) and (ii)(A) of Section 2.2(f) of the Letter of
Credit Agreement solely with respect to a Letter of Credit in the
amount of $7,000,000 to be issued to United States Fidelity and
Guaranty, Co. (the "January 2002 Letter of Credit"); provided
that the aforesaid waiver relates solely to the issuance of the
January 2002 Letter of Credit and to the specific conditions
precedent to issuance of such Letter of Credit, and nothing in
this Amendment is intended, or shall be construed, to waive any
of the conditions precedent in Section 2.2(f) with respect to the
issuance of any other Letters of Credit.
2. Amendment of the Letter of Credit Agreement. Subject to the
terms and conditions of this Amendment, including without
limitation the fulfillment of the conditions precedent specified
in Section 7 below, the Letter of Credit Agreement is hereby
amended
(A) Annex A to the Letter of Credit Agreement is
hereby amended by deleting therefrom the definition of
"Commitment" in its entirety and substituting the following
amended definition of such term in lieu thereof:
"Commitment" shall mean commitment of Creditor to
incur Letter of Credit Obligations, which commitment
shall be One Hundred Twenty-Five Million Dollars
($125,000,000) on the Closing Date, as such amount may
be adjusted, if at all, from time to time in accordance
with this Agreement.
(B) Section 1.1(a) to the Letter of Credit Agreement
is hereby amended by adding a new sentence at the end of
Section 1.1(a) to read in its entirety as follows:
Notwithstanding anything to the contrary contained in
this Agreement, at no time shall the sum of the Pledged
Entity Adjusted Debt plus the outstanding balance of
the Letter of Credit Exposure exceed Two Hundred
Million Dollars ($200,000,000).
(C) Section 2.2(d) to the Letter of Credit Agreement
is hereby deleted and a new Section 2.2(d) is hereby
substituted in lieu thereof to read in its entirety as
follows:
(d) After giving effect to the incurrence of such
Letter of Credit Obligation, either (i) a Letter of
Credit Exposure Excess would exist, or (ii) the sum of
the Pledged Entity Adjusted Debt plus the outstanding
balance of the Letter of Credit Exposure would exceed
Two Hundred Million Dollars ($200,000,000); or
3. No Other Amendments. Except for the waiver expressly set
forth and referred to in Section 1 and the amendments expressly
set forth and referred to in Section 2, each of the Letter of
Credit Agreements shall remain unchanged and in full force and
effect. Nothing in this Amendment is intended or shall be
construed to be a novation of any of the Letter of Credit
Agreements or to affect, modify or impair the continuity or
perfection of the Creditor's Liens under the Collateral
Documents.
4. Representations and Warranties. To induce GE Capital to
enter into this Amendment, Debtor and each of the other Credit
Parties hereby warrant, represent and covenant to GE Capital
that: (a) this Amendment has been duly authorized, executed and
delivered by Debtor and each Credit Party signatory thereto, (b)
after giving effect to this Amendment, no Termination Event or
Event of Default has occurred and is continuing as of this date,
and (c) after giving effect to this Amendment, all of the
representations and warranties made by Debtor and each Credit
Party in the Letter of Credit Agreement are true and correct in
all material respects on and as of the date of this Amendment
(except to the extent that any such representations or warranties
expressly referred to a specific prior date). Any breach in any
material respect by Debtor or any Credit Party of any of its
representations and warranties contained in this Section 3 shall
be an Event of Default under the Letter of Credit Agreement.
5. Ratification and Acknowledgment. Debtor and each of the
other Credit Parties hereby ratify and reaffirm each and every
term, covenant and condition set forth in the Letter of Credit
Agreement and all other documents delivered by such company in
connection therewith (including without limitation the other
Letter of Credit Documents to which Debtor or any Credit Party is
a party), effective as of the date hereof.
6. Estoppel. To induce GE Capital to enter into this
Amendment, Debtor and each of the other Credit Parties hereby
acknowledge and agree that, as of the date hereof, there exists
no right of offset, defense or counterclaim in favor of Debtor or
any Credit Party as against GE Capital with respect to the
obligations of Debtor or any Credit Party to GE Capital under the
Letter of Credit Agreement or the other Letter of Credit
Agreement Documents, either with or without giving effect to this
Amendment.
7. Conditions to Effectiveness. This Amendment shall become
effective, as of the Effective Date, subject to the prior or
subsequent receipt by the Creditor of the following, in each
case, in form and substance satisfactory to Creditor:
(a) this Amendment, duly executed, completed and
delivered by Debtor and each other Credit Party.
(b) Debtor shall have delivered to Creditor a
certificate of the Chief Financial Officer of Debtor (the
"Certificate of the Chief Financial Officer"), substantially in
the form attached hereto as Exhibit A demonstrating:
(i) the ability of Debtor and the other Credit
Parties to pay all of their respective payroll obligations,
payroll taxes and related amounts due on January 22, 2002, for
services provided by employees of Debtor and Credit Parties for
the period from January 6, 2002 through and including January 12,
2002; and
(ii) the ability of Debtor and the other Credit
Parties to pay all of their respective pension plan and employee
benefit plan payment obligations for the period from December 2,
2001 to December 31, 2001.
The Certificate of the Chief Financial Officer shall also contain
a certification, based upon income statement and cash flow
statement projections attached thereto and satisfactory to
Creditor, that Debtor and the other Credit Parties have liquid
assets available to fund any and all disbursements of the Credit
Parties when due and payable (or, in the case of trade payables
with reasonable promptness after such trade payables are due and
payable) on or after the period commencing on the date hereof
through and including February 17, 2002, including, without
limitation, all trade payables of Debtor and the other Credit
Parties, all payroll obligations, payroll taxes and related
amounts of Debtor and the other Credit Parties and all pension
plan and employee benefit plan payment obligations of Debtor and
the other Credit Parties.
Upon the effective date of this Amendment, the amendment set
forth in Section 2 of this Amendment shall become effective as of
the effective date of this Amendment.
8. Reimbursement of Expenses. Debtor and each of the other
Credit Parties hereby agree that Debtor and each of the other
Credit Parties shall reimburse GE Capital on demand for all costs
and expenses (including without limitation reasonable attorney's
fees) incurred by GE Capital in connection with the negotiation,
documentation and consummation of this Amendment and the other
documents executed in connection herewith and therewith and the
transactions contemplated hereby and thereby.
9. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
FOR CONTRACTS TO BE PERFORMED ENTIRELY WITHIN SAID STATE.
10. Severability of Provisions. Any provision of this Amendment
which is prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the
remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction. To
the extent permitted by applicable law, Debtor and each of the
other Credit Parties hereby waive any provision of law that
renders any provision hereof prohibited or unenforceable in any
respect.
11. Counterparts. This Amendment may be executed in any number
of several counterparts, all of which shall be deemed to
constitute but one original and shall be binding upon all
parties, their successors and permitted assigns.
12. Entire Agreement. The Letter of Credit Agreement as amended
by this Amendment embodies the entire agreement between the
parties hereto relating to the subject matter hereof and
supersedes all prior agreements, representations and
understandings, if any, relating to the subject matter hereof.
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signature page]
IN WITNESS WHEREOF, the parties have caused
this Seventh Amendment to Letter of Credit Agreements to be duly
executed by their respective officers thereunto duly authorized,
as of the date first above written.
DEBTOR:
CONSOLIDATED FREIGHTWAYS CORPORATION
By
Name:
Title:
CREDITOR:
GENERAL ELECTRIC CAPITAL CORPORATION
By
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Its Duly Authorized Signatory
SUBSIDIARY GUARANTORS:
CONSOLIDATED FREIGHTWAYS CORPORATION OF
DELAWARE
By:
Name:
Title:
CF AIRFREIGHT CORPORATION
By:
Name:
Title:
REDWOOD SYSTEMS, INC.
By:
Name:
Title:
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ CORPORATION
By:
Name:
Title:
