Exhibit 10.1
AMENDMENT NO. 5 TO CREDIT AGREEMENT AMONG UNITED ROAD SERVICES INC., URS
SOUTHWEST, INC., URS NORTHEAST, INC., FAST TOWING, INC., CITY TOWING INC., EL
PASO TOWING, INC., URS OF TENNESSEE, INC., KEN LEHMAN ENTERPRISES INC., URS
MIDWEST, INC., URS WEST, INC., URS SOUTHEAST, INC., ROUSE'S BODY SHOP INC., AUTO
SERVICE CENTER, GARRY'S WRECKER SERVICE, INC., ENVIRONMENTAL AUTO REMOVAL, INC.,
E&R TOWING & GARAGE, INC., BILL & WAG'S, INC. AND ARRI BROTHERS, INC., AS
BORROWERS; GENERAL ELECTRIC CAPITAL CORPORATION, AS A LENDER, AND AS AGENT FOR
LENDERS; AND THE OTHER LENDERS
This Amendment No. 5 to Credit Agreement, dated as of November 13,
2002 (this "Amendment"), is entered into by and among United Road Services,
Inc., URS Southwest, Inc., URS Northeast, Inc., Fast Towing, Inc., City Towing
Inc., El Paso Towing, Inc., URS of Tennessee, Inc., Ken Lehman Enterprises Inc.,
URS Midwest, Inc., URS West, Inc., URS Southeast, Inc., Rouse's Body Shop Inc.,
Auto Service Center, Garry's Wrecker Service, Inc., Environmental Auto Removal,
Inc., E&R Towing & Garage, Inc., Bill & Wag's, Inc. and Arri Brothers, Inc.
(each a "Borrower" and, collectively, "Borrowers"), as Borrowers; General
Electric Capital Corporation, as a Lender, and as Agent for Lenders; and the
other Lenders.
RECITALS
A. Borrowers, Agent and Lenders are parties to that certain Credit
Agreement, dated as of July 20, 2000, as amended by Amendment No. 1 thereto,
dated as of September 25, 2000, Amendment No. 2 thereto, dated as of March 30,
2001, Amendment No. 3 thereto, dated as of February 20, 2002, and Amendment No.
4 thereto, dated as of August 14, 2002 (as so amended and as hereafter further
amended, restated or otherwise modified, the "Credit Agreement").
B. Borrowers have notified Agent and Lenders that Events of Default have
occurred and are continuing under the Credit Agreement as a result of Borrowers'
breach of the following covenants: (i) clause (b) of Annex G (Section 6.10) to
Credit Agreement (Minimum Fixed Charge Coverage Ratio) for the 12-month period
ended September 30, 2002 and (ii) clause (c) of Annex G (Section 6.10) to Credit
Agreement (Minimum EBITDA) for the three Fiscal Quarters ended September 30,
2002, (such Events of Default are collectively referred to in this Amendment as
the "Existing Events of Default").
C. Borrower has requested that Agent and Lenders waive the Existing Events
of Default, and Agent and Lenders are willing to do so pursuant to the terms and
conditions set forth in this Amendment, including, without limitation, that
Borrowers are in compliance with the terms of (i) clause (c) of Annex E (Section
4.1(a)) to Credit Agreement (Operating Plan) as such clause (c) is amended in
Section 3.1 of this Amendment, (ii) clause (b) of Annex G (Section 6.10) to
Credit Agreement (Minimum Fixed Charge Coverage Ratio) as such clause (b) is
amended in Section 3.2 of this Amendment, and (iii) clause (c) of Annex G
(Section 6.10) to Credit Agreement (Minimum EBITDA) as such clause (c) is
amended in Section 3.3 of this Amendment.
D. Borrower, Agent and Lenders are desirous of amending the Credit
Agreement as and to the extent set forth herein and pursuant to the terms and
conditions set forth in this Amendment.
E. This Amendment shall constitute a Loan Document and these Recitals
shall be construed as part of this Amendment.
NOW THEREFORE, in consideration of the premises and the mutual
covenants hereinafter contained, and of the Revolving Credit Advances and other
extensions of credit heretofore, now or hereafter made to, or for the benefit
of, Borrowers by Lenders, Borrowers, Agent and Lenders hereby agree as follows:
1. Definitions. Except to the extent otherwise specified herein,
capitalized terms used in this Amendment shall have the same meanings ascribed
to them in the Credit Agreement and Annex A thereto.
2. Waiver.
2.1. Existing Events of Default. Agent and Lenders hereby waive the
Existing Events of Default; provided, however, that Borrowers shall be in
compliance with the terms of (i) clause (c) of Annex E (Section 4.1 (a)) to
Credit Agreement (Operating Plan) as clause (c) is amended by the provisions of
Section 3.1 of this Amendment, (ii) clause (b) of Annex G (Section 6.10) to
Credit Agreement (Minimum Fixed Charge Coverage Ratio) as such clause (b) is
amended in Section 3.2 of this Amendment, and (iii) clause (c) of Annex G
(Section 6.10) to Credit Agreement (Minimum EBITDA) as such clause (c) is
amended in Section 3.3 of this Amendment. The foregoing waiver is only
applicable and shall only be effective in the specific instance and for the
specific purpose for which made. Such waiver is expressly limited to the facts
and circumstances referred to herein and shall not operate (a) as a waiver of or
consent to non-compliance with any other provision of the Credit Agreement or
any other Loan Document, (b) as a waiver of any other right, power or remedy of
Agent or Lenders under the Credit Agreement or any other Loan Document or (c) as
a waiver of or consent to any other Default or Event of Default under the Credit
Agreement or any other Loan Document.
3. Amendments. The Credit Agreement is hereby amended as follows:
3.1. Operating Plan. Clause (c) of Annex E (Section 4.1 (a)) to Credit
Agreement (Operating Plan) is hereby amended by inserting the following clause
immediately following the words "but no later than 30 days after the end of such
Fiscal Year" in the first sentence contained therein: ", provided, that,
notwithstanding the foregoing, in the case of the annual operating plan for
Fiscal Year 2003, such plan shall be delivered not later than December 31,
2002,".
3.2. Minimum Fixed Charge Coverage Ratio. The Minimum Fixed Charge
Coverage Ratios set forth in Section (b) of Annex G (Section 6.10) to the Credit
Agreement for the 12-month periods ended at the end of each Fiscal Quarter set
forth below (provided, however, that (w) in the case of Borrowers' Fiscal
Quarters ended March 31, 2003, March 31, 2004 and March 31, 2005, this financial
covenant shall be measured for the Fiscal Quarter then ended, (y) in the case of
Borrowers' Fiscal Quarter ended June 30, 2003, June 30, 2004 and June
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30, 2005, this financial covenant shall be measured for the two Fiscal Quarters
then ended, and (z) in the case of Borrowers' Fiscal Quarter ended September 30,
2002, September 30, 2003, and September 30, 2004, this financial covenant shall
be measured for the three Fiscal Quarters then ended) are hereby replaced with
the following:
Fiscal Quarter Ending Minimum Fixed Charge Coverage Ratio
--------------------- -----------------------------------
September 30, 2002 85 to 1.0
December 31, 2002 1.1 to 1.0
March 31, 2003 1.0 to 1.0
June 30, 2003 1.1 to 1.0
September 30, 2003 1.2 to 1.0
December 31, 2003 1.2 to 1.0
March 31, 2004 1.3 to 1.0
June 30, 2004 1.3 to 1.0
September 30, 2004 1.4 to 1.0
December 31, 2004 1.4 to 1.0
March 31, 2005 1.5 to 1.0
June 30, 2005 1.5 to 1.0
3.3. Minimum EBITDA. The Minimum EBITDA amounts set forth in Section
(c) of Annex G (Section 6.10) to the Credit Agreement for the 12-month periods
ended at the end of each Fiscal Quarter set forth below (provided, however, that
(w) in the case of Borrowers' Fiscal Quarters ended March 31, 2002, March 31,
2003, March 31, 2004 and March 31, 2005, this financial covenant shall be
measured for the Fiscal Quarter then ended, (y) in the case of Borrowers' Fiscal
Quarters ended June 30, 2002, June 20, 2003, June 30, 2004 and June 30, 2005,
this financial covenant shall be measured for the two Fiscal Quarters then
ended, and (z) in the case of Borrowers' Fiscal Quarters ended September 30,
2002, September 30, 2003 and September 30, 2004, this financial covenant shall
be measured for the three Fiscal Quarters then ended) are hereby replaced with
the following:
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Fiscal Quarter Ending Minimum EBITDA
September 30, 2002 $ 7,950,000
December 31, 2002 $13,750,000
March 31, 2003 $ 3,650,000
June 30, 2003 $ 7,900,000
September 30, 2003 $12,400,000
December 31, 2003 $16,900,000
March 31, 2004 $ 4,600,000
June 30, 2004 $ 9,700,000
September 30, 2004 $15,000,000
December 31, 2004 $20,200,000
March 31, 2005 $ 5,300,000
June 30, 2005 $11,200,000
4. Conditions Precedent to Effectiveness. The effectiveness of the
waivers set forth in Section 2 and the amendments set forth in Section 3 hereof
are in each instance subject to the satisfaction of each of the following
conditions precedent:
4.1. Amendment. This Amendment shall have been duly executed and
delivered by the Borrowers, Agent and Lenders.
4.2. No Default. No Default or Event of Default (other than the
Existing Events of Default) shall have occurred and be continuing or would
result from the effectiveness of this Amendment.
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4.3. Amendment Fee. Borrower shall have paid an amendment fee to Agent,
for the pro rata accounts of the Lenders which have timely approved this
Amendment, as evidenced by each such Lender's timely execution and delivery of a
counterpart signature page to this Amendment, in an aggregate amount for all
such Lenders which have timely approved this Amendment equal to $75,000.
4.4. Miscellaneous. Agent and Lenders shall have received such other
agreements, instruments and documents as Agent or Lenders may reasonably
request.
5. Reference to and Effect Upon the Credit Agreement and other Loan
Agreements.
5.1. Except for as specifically amended in Section 3 above, the Credit
Agreement, the Notes and each other Loan Document shall remain in full force and
effect and each is hereby ratified and confirmed.
5.2. The execution, delivery and effect of this Amendment shall be
limited precisely as written and shall not be deemed to (i) be a consent to any
waiver of any term or condition (except for the specific waivers in Section 2
above), or to any amendment or modification of any term or condition (except as
specifically amended in Section 3 above), of the Credit Agreement or any other
Loan Document or (ii) prejudice any right, power or remedy which the Agent or
any Lender now has or may have in the future under or in connection with the
Credit Agreement, the Notes or any other Loan Document. Each reference in the
Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or any
other word or words of similar import shall mean and be a reference to the
Credit Agreement as amended hereby, and each reference in any other Loan
Document to the Credit Agreement or any word or words of similar import shall be
and mean a reference to the Credit Agreement as amended hereby.
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6. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed an original but all
such counterparts shall constitute one and the same instrument. Delivery of an
executed counterpart of a signature page to this Amendment by telecopier shall
be as effective as delivery of a manually executed counterpart signature page to
this Amendment.
7. Costs and Expenses. As provided in Section 11.3 of the Credit
Agreement, Borrowers shall pay the fees, costs and expenses incurred by Agent in
connection with the preparation, execution and delivery of this Amendment
(including, without limitation, attorneys' fees).
8. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED
AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS (AS OPPOSED TO CONFLICTS OF
LAW PROVISIONS) OF THE STATE OF NEW YORK.
9. Headings. Section headings in this Amendment are included herein
for convenience of reference only and shall not constitute a part of this
Amendment for any other purpose.
[Signature Pages Follow]
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IN WITNESS WHEREOF, this Amendment No. 5 to Credit Agreement has been
duly executed as of the date first written above.
BORROWERS:
UNITED ROAD SERVICES, INC.
By: /s/ Patrick J. Fodale
-------------------------------
Name: Patrick J. Fodale
-----------------------------
Title: Chief Financial Officer
----------------------------
URS SOUTHWEST, INC.
URS NORTHEAST, INC.
FAST TOWING, INC.
CITY TOWING INC.
EL PASO TOWING, INC.
URS OF TENNESSEE, INC.
KEN LEHMAN ENTERPRISES INC.
URS MIDWEST, INC.
URS WEST, INC.
URS SOUTHEAST, INC.
ROUSE'S BODY SHOP INC.
AUTO SERVICE CENTER
GARRY'S WRECKER SERVICE, INC.
ENVIRONMENTAL AUTO REMOVAL, INC.
E&R TOWING & GARAGE, INC.
BILL & WAG'S, INC.
ARRI BROTHERS, INC.
By: /s/ Patrick J. Fodale
----------------------------
Name: Patrick J. Fodale
----------------------------
Title: Chief Financial Officer
----------------------------
GENERAL ELECTRIC CAPITAL
CORPORATION,
as Agent and Lender
By: /s/ Joseph Hess
-------------------------
Duly Authorized Signatory
FLEET CAPITAL CORPORATION,
as Lender
By: /s/ Thomas Karlov
------------------------------
Name: Thomas Karlov
------------------------------
Title: Senior Vice President
------------------------------
LASALLE BUSINESS CREDIT, INC.,
as Lender
By: /s/ Daniel Clancy
------------------------------
Name: Daniel Clancy
------------------------------
Title: Vice President
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COMERICA BANK,
as Lender
By: ____________________________________
Name: __________________________________
Title: _________________________________