Exhibit 10.01
FIFTH AMENDMENT TO CREDIT AGREEMENT
THIS FIFTH AMENDMENT TO CREDIT AGREEMENT (this
"Amendment"), is made and entered into as of January 18, 2002
(the "Effective Date"), by and between 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 SS 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 that all capitalized terms used herein
shall have the meanings ascribed thereto in the Credit Agreement
(except as otherwise expressly defined or limited herein) and do
hereby further agree as follows:
1. 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 definitions of "Borrowing
Base" and "Additional Mortgaged Properties" in their
entirety and substituting the following amended
definitions of such terms in lieu thereof:
"Additional Mortgaged Properties" shall mean
the real property owned by one or more of the
Credit Parties and located at (a) 918 Del Paso
Road, Sacramento, California, (b) 6767 West 75th
Street, Chicago, Illinois, and (c) 11888 Mission
Boulevard, Mira Loma, California.
"Borrowing Base" shall mean, as of any date
of determination by Lender, from time to time, an
amount equal to the sum of (a) forty-two percent
(42%) 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 $42,000,000 less the total amount
of any mandatory prepayments required to be made
pursuant to Section 1.2(b)(iii) as a result of the
incurrence from time to time of any Funded Debt by
any Foreign Subsidiary under the Canadian Credit
Facility.
(B) Annex A to the Credit Agreement is hereby
further amended by adding in alphabetical order the
definition of "Canadian Credit Facility" to read in its
entirety as follows:
"Canadian Credit Facility" shall mean a
credit facility in the maximum principal amount of
Cnd$6,500,000 to be provided by Tyco Capital
(Canada) Inc. ("Tyco") to Canadian Freightways
Limited and/or one or more Canadian Foreign
Subsidiaries, having the terms as set forth in
that certain commitment letter dated December 21,
2001 between Canadian Freightways Limited and
Tyco.
2. Covenants. Borrower shall utilize the entire
proceeds of the initial Revolving Credit Advances made on the
date of this Amendment to make a capital contribution to the
Receivables Subsidiary in the aggregate amount of $7,000,000 (the
"Capital Contribution"). Borrower shall cause the Receivables
Subsidiary immediately upon receipt of the Capital Contribution
to apply the entire amount of the Capital Contribution to the
repayment of outstanding Receivables Advances in the aggregate
principal amount of $7,000,000 to create additional availability
under the Receivables Funding Agreement. The initial Revolving
Credit Advances made on the date of this Amendment shall be
disbursed by the Lender solely in accordance with the
disbursement direction letter in the form of Exhibit A attached
hereto (the "Disbursement Direction Letter").
3. No Other Amendments. Except for the amendments
expressly set forth and referred to in Section 1 above, the
Credit Agreement shall remain unchanged and in full force and
effect.
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, subject to the prior
or subsequent 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.
(b) the Seventh Amendment to Letter of Credit
Agreements dated as of the date hereof, duly executed, completed
and delivered by Borrower and each other Credit Party.
(c) a copy of the credit agreement executed by HSBC
Bank Canada ("HSBC"), pursuant to which HSBC commits to provide
an accounts receivable credit facility to one or more Canadian
Foreign Subsidiaries, having such terms and conditions as are
reasonably satisfactory to Lender.
(d) a letter from Discovery Re insurance company
("Discovery Re") confirming that (i) they have not canceled any
workers' compensation insurance policies of the Credit Parties or
their Subsidiaries (the "Insurance Policies"), (ii) upon receipt
of a letter of credit in the amount of $7,000,000, issued for the
account of Borrower or any other Credit Party for the benefit of
United States Fidelity and Guaranty, Co., the Insurance Policies
shall remain in full force and effect through and including March
18, 2002, and (iii) confirming Discovery Re's agreement not to
give a notice of cancellation with respect to any of the
Insurance Policies prior to February 19, 2002. Lender shall also
have received from Credit Parties a certificate of insurance
issued by Discovery Re certifying as to the coverage under the
existing Insurance Policies, together with such other documents,
certificates and information as it may reasonably request in
order to confirm that the Insurance Policies remain in effect as
of the date of this Amendment and satisfy the requirements of
applicable law.
(e) a copy of a proposal letter by Special Value
Management LLC ("Special Value") to Borrower and/or CF Delaware,
pursuant to which Special Value, as lender, proposes to enter
into a real estate loan facility with Borrower and/or CF Delaware
to be closed by no later than February 18, 2002 and otherwise
having such terms and conditions as are reasonably satisfactory
to Lender.
(f) each Credit Party owner of the Additional
Mortgaged Properties located at 11888 Mission Boulevard, Mira
Loma, California (the "Mira Loma Property") shall have (i)
executed and delivered to Lender a Mortgage covering all of the
Mira Loma Property, in proper form for recordation in all places
to the extent necessary to create a valid and enforceable first
priority lien (subject to Permitted Encumbrances) on the Mira
Loma Property in favor of Lender (or in favor of such other
trustee as may be required or desired under local law) and
otherwise in form and substance satisfactory to Lender, (ii)
delivered to Lender an opinion of California counsel regarding
the Mortgage on the Mira Loma Property in form and substance and
from counsel satisfactory to Lender, (iii) delivered to Lender a
title report, all form and scope satisfactory to Lender, covering
the Mira Loma Property, which report shall not show any Liens on
the Mira Loma Property (other than Permitted Encumbrances), (iv)
delivered to Lender written fair market value appraisals, in each
case satisfactory in form and substance to Lender, in its sole
discretion, and (v) fully cooperated with Lender by providing
Lender and/or its consultants and agents with access to, and
information concerning, the Mira Loma Property as may be
requested by Lender (or such consultant or agent of Lender) and
as may be necessary to ensure completion of Phase I Environmental
Site Assessment Reports, consistent with American Society for
Testing and Materials (ASTM) Standard E 1527-94 and applicable
state requirements, prepared by environmental engineers
satisfactory to Lender, all in form and substance satisfactory to
Lender, in its reasonable discretion.
(g) a Fee Letter dated the date hereof, duly executed,
completed and delivered by Borrower and Lender.
Upon the effective date of this Amendment, all of the amendments
set forth in Section 1 of this Amendment 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.
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page]
IN WITNESS WHEREOF, the parties have caused this Fifth
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 /s/Robert E. Wrightson
Name: Robert E. Wrightson
Title: Executive Vice President and
Chief Financial Officer
LENDER:
GENERAL ELECTRIC CAPITAL CORPORATION
By /s/Craig Winslow
Name: Craig Winslow
Title: Duly Authorized Signatory
CREDIT PARTIES:
CONSOLIDATED FREIGHTWAYS CORPORATION OF
DELAWARE
By /s/Robert E. Wrightson
Name: Robert E. Wrightson
Title: Executive Vice President and
Chief Financial Officer
CF AIRFREIGHT CORPORATION
By /s/Robert E. Wrightson
Name: Robert E. Wrightson
Title: Executive Vice President and
Chief Financial Officer
REDWOOD SYSTEMS, INC.
By:/s/Kerry K. Morgan
Name:Kerry K. Morgan
Title:Vice President and Treasurer
LELAND JAMES SERVICE CORPORATION
By:/s/Kerry K. Morgan
Name:Kerry K. Morgan
Title:Vice President and Treasurer