| | On March 29, 2012, Covenant Transportation Group, Inc., a Nevada corporation (the “Company”), and its direct and indirect wholly-owned subsidiaries, Covenant Transport, Inc., a Tennessee corporation (“CTI”), CTG Leasing Company, a Nevada corporation (“CTGL”), Southern Refrigerated Transport, Inc., an Arkansas corporation (“SRT”), Covenant Asset Management, Inc., a Nevada corporation (“CAM”), Covenant Transport Solutions, Inc., a Nevada corporation (“CTS”), and Star Transportation, Inc., a Tennessee corporation (collectively with CTI, CTGL, SRT, CAM, and CTS, the “Borrowers”), entered into that certain Seventh Amendment to Third Amended and Restated Credit Agreement (the “Seventh Amendment”) with Bank of America, N.A., as agent (the “Agent”), and JPMorgan Chase Bank, N.A. (together with the Agent, the “Lenders”), which amends that certain Third Amended and Restated Credit Agreement, dated September 23, 2008, by and among the Company, the Borrowers, the Agent, and the Lenders, as amended (the “Credit Agreement”). The Seventh Amendment amends the definitions of: (i) “Issuing Bank” to include JPMorgan Chase Bank, N.A. as an additional letter of credit issuer under the Credit Agreement’s letter of credit sub facility, and (ii) “Real Estate Formula Amount” to effect a one-time reduction in that amount of $3,464,634. The “Real Estate Formula Amount” is a component of the Borrowing Base calculation, and the reduction in the “Real Estate Formula Amount” similarly reduces the Borrowing Base. The amount of the reduction is approximately sixty-five percent (65%) of the net sale proceeds received by the Borrowers in connection with the sale of a certain Long Beach, California property. Prior to being sold, the Long Beach, California property had contributed sixty-five percent (65%) of its fair market value to the Borrowing Base. |
