Exhibit 10.01
EIGHTH AMENDMENT TO CREDIT AGREEMENT
THIS EIGHTH AMENDMENT TO CREDIT AGREEMENT (this
"Amendment"), is made and entered into as of April 5, 2002 (the
"Effective Date"), by and among CONSOLIDATED FREIGHTWAYS
CORPORATION, a Delaware corporation ("Borrower"), the other
Credit Parties signatory to the Credit Agreement described below
(collectively, together with the Borrower, the "Credit Parties")
and GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation
("Lender").
W I T N E S S E T H:
WHEREAS, Borrower, the other Credit Parties and Lender
are parties to that certain Credit Agreement, dated as of October
24, 2001 (as amended to the date hereof, the "Credit Agreement";
capitalized terms used herein and not otherwise defined herein
shall have the meanings given such terms in the Credit
Agreement), pursuant to which Lender has committed to make
certain loans to Borrower upon the terms and conditions set forth
therein; and
WHEREAS, Borrower, the other Credit Parties and Lender
desire to modify the Credit Agreement in certain respects 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, Borrower, the other Credit Parties and
Lender do hereby 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
Lender hereby waives (i) any Default or Event of Default
resulting from any failure of Borrower to meet the Minimum EBITDA
financial covenant in clause (c) of Annex D solely for the Fiscal
Quarters ending December 31, 2001 and March 31, 2002, as such
financial covenant is in effect immediately prior to the date of
this Amendment or as it was in effect immediately prior to the
Sixth Amendment Effective Date; provided, however that any such
Default or Event of Default shall automatically be restored if
Borrower shall fail or have failed to satisfy such financial
covenant as amended hereby and (ii) any Default or Event of
Default resulting from any failure of Borrower to meet the
Minimum Fixed Charge Coverage Ratio financial covenant in clause
(a) of Annex D solely for the Fiscal Quarter ending March 31,
2002, as such financial covenant is in effect immediately prior
to the date of this Amendment; provided, however that any such
Default or Event of Default shall automatically be restored if
Borrower shall fail or have failed to satisfy such financial
covenant as amended hereby.
2. Amendments to the 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 Credit Agreement is hereby amended as
follows:
A. Annex A to the Credit Agreement is hereby amended
by deleting therefrom the definition of "Borrowing Base" in its
entirety and substituting the following amended definition of
such term in lieu thereof:
"Borrowing Base" shall mean, as of any date of
determination by Lender, from time to time, an amount equal to
the sum of (a) thirty nine and twenty-one hundredths percent
(39.21%) (as it may be amended from time to time, the "Advance
Rate") of the Appraised Value of Eligible Mortgaged Property less
(b) any and all Reserves established by Lender at such time
including, without limitation, Reserves for environmental
remediation costs, accrued but unpaid taxes, insurance and other
Charges and expenses pertaining to such Mortgaged Property.
Notwithstanding the foregoing, irrespective of whether any of the
conditions in Section 2 have been satisfied, the Borrowing Base
shall not at any time exceed an amount equal to $41,200,000 (as
reduced from time to time pursuant to clauses (x), (y) and (z)
below in this sentence, the "Borrowing Limit") less the following
amounts (x) the total amount of any mandatory prepayments
required to be made pursuant to Section 1.2(b)(ii) as a result of
the consummation from time to time of any Asset Dispositions
after the Seventh Amendment Effective Date, (y) the total amount
of any mandatory prepayments required to be made pursuant to
Section 1.2(b)(iii) as a result of any issuance from time to time
of Stock and (z) the total amount of any mandatory prepayments
required to be made pursuant to Section 1.2(b)(iii) as a result
of the issuance from time to time of any debt securities or the
incurrence from time to time of any Funded Debt, provided,
however, that the amount in this clause (z) shall be deemed to be
Zero Dollars ($0) if at the time of receipt of the proceeds from
the issuance of such debt securities or the incurrence of such
Funded Debt, the Borrowing Limit is then equal to or less than
$25,000,000. The Borrower shall have the option at any time to
permanently reduce the Borrowing Limit to a dollar amount less
than the Borrowing Limit then in effect by giving a written
notice (a "Borrowing Limit Reduction Notice") to Lender
requesting such reduction. Any reduction in the Borrowing Limit
pursuant to the giving of a Borrowing Limit Reduction Notice by
Borrower shall take effect on the first Business Day after
receipt by Lender of such notice and shall constitute a permanent
and irrevocable reduction in the Borrowing Limit. The Borrower
shall have the option at any time to permanently reduce the
Advance Rate to a percentage rate less than the Advance Rate then
in effect by giving a written notice (a "Advance Rate Reduction
Notice") to Lender requesting such reduction. Any reduction in
the Advance Rate pursuant to the giving of an Advance Rate
Reduction Notice by Borrower shall take effect on the first
Business Day after receipt by Lender of such notice and shall
constitute a permanent and irrevocable reduction in the Advance
Rate.
B. Annex C is amended by adding a new clause (m) to
the end thereof to read in its entirety as follows:
(m) Weekly Cash Flow Forecast. No less
frequently than the last Business Day of each calendar
week, a twelve-week cash flow forecast for the Borrower
and its Subsidiaries for the next succeeding period of
twelve consecutive calendar weeks, in such form and
with such detail as is satisfactory to Lender,
accompanied by such supporting detail and documentation
as shall be requested by Lender in its reasonable
discretion.
C. Clause (a) of Annex D is deleted in its entirety
and replaced with a new clause (a) as set forth below:
(a) Minimum Fixed Charge Coverage Ratio. The
Borrower and its Subsidiaries shall have on a
consolidated basis, as of the end of each Fiscal
Quarter set forth below, a Fixed Charge Coverage Ratio
for the period set forth below of not less than the
following:
Fiscal Quarter Minimum Fixed
Charge
Coverage Ratio
for the Rolling Period 0.20 to 1.00
ending September 30,
2001
for the Rolling Period 0.01 to 1.00
ending December 31, 2001
for the three month -1.80 to 1.00
period ending March 31,
2002
for the six month period -1.20 to 1.00
ending June 30, 2002
for the nine month -0.30 to 1.00
period ending September
30, 2002
for the Rolling Period 0.20 to 1.00
ending December 31, 2002
for the Rolling Period 1.70 to 1.00
ending on each Fiscal
Quarter thereafter
D. Clause (c) of Annex D is deleted in its entirety
and replaced with a new clause (c) as set forth below:
(c) Minimum EBITDA. Borrower and its
Subsidiaries shall have on a consolidated basis, for
each period set forth below, an EBITDA for such period
of not less than the following:
Fiscal Quarter Minimum EBITDA
for the Rolling Period $8,000,000
ending September 30,
2001
for the Rolling Period -$3,300,000
ending December 31, 2001
for the three month -$13,300,000
period ending March 31,
2002
for the six month period -$16,400,000
ending June 30, 2002
for the nine month $1,400,000
period ending September
30, 2002
for the Rolling Period $20,500,000
ending December 31, 2002
for the Rolling Period $80,000,000
ending on each Fiscal
Quarter thereafter
E. Section 6.3(o) of the Credit Agreement is amended
by deleting clause (i) thereof in its entirety and replacing it
with a new clause (i) to read as follows:
(i) the aggregate outstanding principal amount of all
Bayview Indebtedness shall not exceed $48,000,000 plus any
capitalized fees at any one time,
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, the
Credit Agreement 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 Credit Agreement or to
affect, modify or impair the continuity or perfection of the
Lenders Liens under the Collateral Documents.
4. Representations and Warranties. To induce Lender
to enter into this Amendment, Borrower and each of the other
Credit Parties hereby warrant, represent and covenant to Lender
that: (a) this Amendment has been duly authorized, executed and
delivered by Borrower and each other Credit Party signatory
thereto, (b) after giving effect to this Amendment, no Default 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 Borrower and each other
Credit Party in the 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 Borrower or any other Credit Party of any of
its representations and warranties contained in this Section 4
shall be an Event of Default under the Credit Agreement.
5. Ratification and Acknowledgment. Borrower and
each of the other Credit Parties hereby ratify and reaffirm each
and every term, covenant and condition set forth in the Credit
Agreement and all other documents delivered by such company in
connection therewith (including without limitation the other Loan
Documents to which Borrower or any other Credit Party is a
party), effective as of the date hereof.
6. Estoppel. To induce Lender to enter into this
Amendment, Borrower 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 Borrower
or any Credit Party as against Lender with respect to the
obligations of Borrower or any Credit Party to Lender under the
Credit Agreement or the other Loan Documents, either with or
without giving effect to this Amendment.
7. Conditions to Effectiveness. This Amendment shall
become effective, as of the Effective Date, upon receipt by the
Lender of the following, in each case, in form and substance
satisfactory to Lender:
(a) this Amendment, duly executed, completed and
delivered by Borrower and each other Credit Party, and
(b) the Ninth Amendment to the Letter of Credit
Agreement, duly executed, completed and delivered by the Borrower
and other Credit Parties signatory thereto, together with the
related fee letter, duly executed by the Borrower, and such
amendment and fee letter are in full force and effect.
Upon the effective date of this Amendment, all of the waivers set
forth in Section 1 and the amendments set forth in Section 2
shall become effective as of the effective date of this
Amendment.
8. Reimbursement of Expenses. Borrower and each of
the other Credit Parties hereby agree that Borrower and each of
the other Credit Parties shall reimburse Lender on demand for all
costs and expenses (including without limitation reasonable
attorney's fees) incurred by Lender 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,
Borrower 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 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.
[Remainder of page intentionally blank; next page is
signature page]
IN WITNESS WHEREOF, the parties have caused this Eighth
Amendment to Credit Agreement to be duly executed by their
respective officers thereunto duly authorized, as of the date
first above written.
BORROWER:
CONSOLIDATED FREIGHTWAYS CORPORATION
By ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name:/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Executive Vice President and
Chief Financial Officer
LENDER:
GENERAL ELECTRIC CAPITAL CORPORATION
By /s/▇▇▇▇▇ ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Its Duly Authorized Signatory
CREDIT PARTIES:
CONSOLIDATED FREIGHTWAYS CORPORATION OF
DELAWARE
By ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name:/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Executive Vice President and
Chief Financial Officer
CF AIRFREIGHT CORPORATION
By ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name:/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Executive Vice President and
Chief Financial Officer
REDWOOD SYSTEMS, INC.
By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ CORPORATION
By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer
CF ▇▇▇▇▇▇.▇▇▇ INCORPORATED
By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Treasurer