<PAGE> 1
EXHIBIT 10.8
THIRD AMENDMENT TO SECOND AMENDED AND RESTATED
CREDIT AGREEMENT AND CONDITIONAL WAIVER AGREEMENT
This THIRD AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT
AND CONDITIONAL WAIVER AGREEMENT (this "Amendment") is made and entered into
effective as of June 28, 2000 (except as otherwise expressly provided herein) by
and among DYNAMEX INC. (the "Borrower"), a Delaware corporation, DYNAMEX CANADA
INC. ("Dynamex Canada"), a federal Canadian corporation, DYNAMEX OPERATIONS
EAST, INC. ("Dynamex East"), a Delaware corporation, DYNAMEX OPERATIONS WEST,
INC. ("Dynamex West"), a Delaware corporation, ROAD RUNNER TRANSPORTATION, INC.
("Road Runner"), a Minnesota corporation, NEW YORK DOCUMENT EXCHANGE CORPORATION
("NYDEX"), a New York corporation, U.S.C. MANAGEMENT SYSTEMS, INC. ("USC"), a
New York corporation, DYNAMEX DEDICATED FLEET SERVICES, INC. ("Fleet Services"),
a Delaware corporation, CANNONBALL, INC. ("Cannonball"), an Illinois
corporation, BANK OF AMERICA, NATIONAL ASSOCIATION (successor by merger to
NationsBank, N.A., which entity was successor by merger to NationsBank of Texas,
N.A.) ("Bank of America"), a national banking association, FLEET NATIONAL BANK
(formerly BankBoston, N.A.) ("Fleet"), a national banking association, BANK
AUSTRIA CREDITANSTALT CORPORATION (formerly Bank Austria Creditanstalt Corporate
Finance, Inc., which entity was formerly Creditanstalt Corporate Finance, Inc.)
("Creditanstalt"), a Delaware corporation, THE BANK OF NOVA SCOTIA ("Scotia
Bank"), a Canadian banking association, BANK ONE, TEXAS, N.A. ("Bank One"), a
national banking association, BANK OF AMERICA, NATIONAL ASSOCIATION (successor
by merger to NationsBank, N.A., which entity was successor by merger to
NationsBank of Texas, N.A.), as agent for itself and the other Lenders (in such
capacity, together with its successors in such capacity, the "Agent") and FLEET
NATIONAL BANK (formerly BankBoston, N.A.) and BANK AUSTRIA CREDITANSTALT
CORPORATION (formerly Bank Austria Creditanstalt Corporate Finance, Inc., which
entity was formerly Creditanstalt Corporate Finance, Inc.), as co-agents (the
"Co-Agents").
RECITALS:
A. Pursuant to that certain Second Amended and Restated Credit
Agreement dated as of August 26, 1997, by and among the Borrower, Dynamex
Canada, Dynamex East, Dynamex West, Parcelway Courier Systems (B.C.) Ltd. (a
British Columbia corporation that has now been dissolved), Road Runner, Bank of
America, Fleet, Creditanstalt, Scotia Bank, the Agent and the Co-Agents (as the
same may be amended, renewed, extended, restated or otherwise modified from time
to time, the "Credit Agreement"), the Lenders agreed to provide to the Borrower
a senior secured revolving credit and letter of credit facility (the "Credit
Facility") in the maximum aggregate principal amount of $75,000,000.
B. Pursuant to that certain First Amendment to Second Amended and
Restated Credit Agreement dated as of May 5, 1998, the parties to the Credit
Agreement amended the Credit Agreement to increase the aggregate amount of the
Credit Facility to $115,000,000 and in certain other respects.
Page 1
<PAGE> 2
C. Pursuant to that certain Second Amendment to Second Amended and
Restated Credit Agreement dated as of January 31, 1999, the parties to the
Credit Agreement amended the Credit Agreement to decrease the aggregate amount
of the Credit Facility to $65,000,000 and in certain other respects.
D. The Borrower and its Subsidiaries, the Agent, the Co-Agents and the
Lenders have agreed, subject to the terms and conditions of this Amendment, to
amend the Credit Agreement to decrease the aggregate amount of the Credit
Facility to $51,734,000 and to amend the Credit Agreement in certain other
respects.
AGREEMENTS:
NOW, THEREFORE, in consideration of the premises and mutual covenants
and agreements contained herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows; provided, however, that this Amendment shall be, ipso
facto, null and void and of no force or effect if any of the conditions
precedent set forth in Paragraph 4 hereof are not fully and timely satisfied on
or before June 28, 2000 or if the condition subsequent set forth in Paragraph 5
hereof is not fully and timely satisfied on or before July 10, 2000:
1. Terms Defined. Unless otherwise defined or stated in this Amendment,
each capitalized term used in this Amendment has the meaning given to such term
in the Credit Agreement (as amended by this Amendment).
2. Amendments to the Credit Agreement.
(a) Amendments relating to Bank of America. All references to
"NationsBank of Texas, N.A." or "NationsBank, N.A." in the Credit Agreement
shall be deemed to be references to "Bank of America, National Association", and
all references to "NationsBank" in the Credit Agreement shall be deemed to be
references to "Bank of America".
(b) Amendments to Certain Other Definitions. The following terms and
definitions thereof set forth in Section 1.1 of the Credit Agreement are hereby
amended and restated to read in their entirety as follows:
Page 2
<PAGE> 3
"'Applicable Margin' means, for the period commencing with the
Closing Date and thereafter to but excluding June 28, 2000, the rate
per annum set forth in the table below that corresponds to the ratio of
(i) Funded Debt as of the date of the relevant financial statements
referred to below to (ii) EBITDA for the four fiscal quarters of the
Borrower and its Subsidiaries then most recently ended as of the date
of such financial statements, calculated in accordance with Section
1.4:
<TABLE>
<CAPTION>
Applicable Margins for
-------------------------------------- --------------------------------------
Ratio of
Funded Debt to EBITDA ABR Loans Eurodollar Loans
-------------------------------------- --------- ----------------
<S> <C> <C>
Less than 1.50 to 1.00 0% 1.50%
-------------------------------------- --------- ----------------
Less than 2.00 to 1.00 but greater
than or equal to 1.50 to 1.00 0% 2.00%
-------------------------------------- --------- ----------------
Less than 2.75 to 1.00 but greater
than or equal to 2.00 to 1.00 0.25% 2.50%
-------------------------------------- --------- ----------------
Less than 3.00 to 1.00 but greater
than or equal to 2.75 to 1.00 0.25% 2.75%
-------------------------------------- --------- ----------------
Greater than or equal to 3.00 to 1.00 0.50% 3.25%
-------------------------------------- --------- ----------------
</TABLE>
For purposes hereof and notwithstanding the preceding sentence, the
Applicable Margin for the period from the Closing Date to the first
Calculation Date shall be deemed to be 0% for ABR Loans and 1.75% for
Eurodollar Loans and shall thereafter be calculated on each Calculation
Date based upon the preceding table and the financial statements
delivered by the Borrower pursuant to Section 8.1(b) and the
certificate delivered by the Borrower pursuant to Section 8.1(d);
provided, that the Applicable Margin for the period from the Second
Amendment Effective Date to the first Calculation Date thereafter shall
be deemed to be 0.50% for ABR Loans and 3.25% for Eurodollar Loans;
provided further that if the Borrower fails to deliver to the Agent
such financial statements or certificate on or before the relevant
Calculation Date, the Applicable Margin shall be deemed to be the
percentage reflected in the preceding table as if the ratio of Funded
Debt to EBITDA were greater than 3.00 to 1.00 until the date such
statements and certificate are received by the Agent, after which the
Applicable Margin shall be determined as otherwise provided herein.
Notwithstanding anything to the contrary contained in this Agreement,
from and after (and including) June 28, 2000, the Applicable Margin for
ABR Loans shall be 2% per annum."
"'Bank of America' means Bank of America, National Association
(successor by merger to NationsBank, N.A., which entity was successor
by merger to NationsBank of Texas, N.A.).
"'Commitment' means, as to any Lender, the obligation of such
Lender to make Loans and incur or participate in Letter of Credit
Liabilities hereunder in an
Page 3
<PAGE> 4
aggregate principal amount at any one time outstanding up to but not
exceeding the amount set forth opposite the name of such Lender on the
signature pages hereto (or any amendment hereto) under the heading
"Commitment" or, if such Lender is a party to an Assignment and
Acceptance, the amount of the "Commitment" set forth in the most recent
Assignment and Acceptance of such Lender, as the same may be reduced or
terminated pursuant to Section 2.12 or 11.2, and "Commitments" means
such obligations of all Lenders. As of the Third Amendment Effective
Date, the aggregate principal amount of the Commitments is
$51,734,000."
"'EBITDA' means, for any period, without duplication, the sum
of the following for the Borrower and its Subsidiaries (or other
applicable Person) for such period determined on a consolidated basis
in accordance with GAAP: (a) Net Income, plus (b) Interest Expense,
plus (c) income and franchise taxes to the extent deducted in
determining Net Income, plus (d) depreciation and amortization expense,
plus (e)other non-cash items to the extent deducted in determining Net
Income, minus (f) non-cash income to the extent included in determining
Net Income, plus (g) for any calculations that include the fiscal
quarter ended (i) October 31, 1999, $235,000, (ii) January 31, 2000,
$43,000, or (iii) April 30, 2000, $56,000 (which amounts referred to in
this clause (g) relate to extraordinary legal fees paid by the Borrower
during such quarters)."
"'Fixed Charge Coverage Ratio' means, for any period, the
ratio of (a) the sum of the following (without duplication) for the
Borrower and its Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP: (i) Net Income, plus (ii)
Interest Expense, plus (iii) income and franchise taxes to the extent
deducted in determining Net Income, plus (iv) depreciation and
amortization expense and other non-cash items to the extent deducted in
determining Net Income, minus (v) non-cash income to the extent
included in determining Net Income, plus (vi) Lease Expense, minus
(vii) Capital Expenditures, plus (viii) for any calculations that
include the fiscal quarter ended (A)October 31, 1999, $235,000,
(B)January 31, 2000, $43,000, or (C) April 30, 2000, $56,000 (which
amounts referred to in this clause (viii) relate to extraordinary legal
fees paid by the Borrower during such quarters) to (b) the Fixed
Charges of the Borrower and its Subsidiaries for such period."
"'Maturity Date' means July 31, 2001."
"'Revolving Period Termination Date' means October 31, 2000."
(c) Deletion of Definition. Section 1.1 of the Credit Agreement is
hereby amended to delete the term "EBIT" and the definition thereof.
Page 4
<PAGE> 5
(d) Addition of Definition. Section 1.1 of the Credit Agreement is
hereby amended to add the following new term and definition thereof, which term
shall appear in alphabetical order in such Section 1.1:
"'Third Amendment Effective Date' means June 28, 2000."
(e) Amendment to Section 2.1(a). The word "and" immediately preceding
clause (iii) of the third sentence of Section 2.1(a) of the Credit Agreement
(relating to Swingline Advances) is hereby deleted and a comma is added in place
thereof and the following phrase is hereby added to the end of such third
sentence immediately succeeding clause (iii) of such sentence and immediately
preceding the period at the end of such sentence:
", and (iv) on and after June 28, 2000, Bank of America shall not make
any Swingline Advances without the prior written consent of the
Required Lenders".
(f) Amendment to Clause (i) of Section 2.4(a). Clause (i) of Section
2.4(a) of the Credit Agreement is hereby amended and restated to read in its
entirety as follows:
"(i) during the periods such Loan is an ABR Loan, the lesser
of (A) the ABR plus two percent (2.00%) or (B) the Maximum Rate; and"
(g) Amendment to Clause (ii) of Section 2.4(a). Clause (ii) of Section
2.4(a) of the Credit Agreement is hereby amended and restated to read in its
entirety as follows:
"(ii) subject to Section 13.26, during the periods such Loan
is a Eurodollar Loan, the lesser of (A) the Eurodollar Rate plus the
Applicable Margin or (B) the Maximum Rate".
(h) Amendment to Section 2.4(b). Clause (i) of Section 2.4(b) of the
Credit Agreement is hereby amended and restated to read in its entirety as
follows:
"(i) in the case of ABR Loans, on the last day of each
calendar month;"
(i) Amendment to Section 8.1. Section 8.1 of the Credit Agreement is
hereby amended to add the following language after the semi-colon at the end of
clause (a) thereof:
"provided, however, that, notwithstanding the 90 day delivery
requirement for the financial statements and certifications mentioned
in clauses (i) and (ii) above, (A) the Borrower shall deliver the
financial statements and certifications referred to in clause (i) above
for the fiscal years ended July 31, 1997, July 31, 1998 and July 31,
1999 on or before July 10, 2000 and (B) the Borrower shall not be
obligated to deliver the certificate of such independent certified
public accountants referred to in
Page 5
<PAGE> 6
clause (ii) above for the fiscal years ended July 31, 1997, July 31,
1998 and July 31, 1999."
(j) Section 8.1(b). Section 8.1(b) of the Credit Agreement is hereby
amended and restated to read in its entirety as follows:
"(b) Quarterly Financial Statements and Monthly Reports. As
soon as available, and in any event within 45 days after the end of
each fiscal quarter of each fiscal year of the Borrower, beginning with
the fiscal quarter ending October 31, 1997, a copy of an unaudited
financial report of the Borrower and its consolidated Subsidiaries as
of the end of such fiscal quarter and for the portion of the fiscal
year then ended containing, on a consolidated basis, balance sheets and
statements of income, retained earnings and cash flow, in each case
setting forth in comparative form the figures for the corresponding
period of the preceding fiscal year, all in reasonable detail certified
by a Responsible Officer of the Borrower to have been prepared in
accordance with GAAP and to fairly and accurately present (subject to
year-end audit adjustments) the financial condition and results of
operations of the Borrower and its consolidated Subsidiaries, on a
consolidated basis, at the date and for the periods indicated therein,
and containing information regarding any guaranties and other
contingent Debt in detail consistent with the information regarding
guaranties and other contingent Debt contained in the Borrower's annual
audit report. As soon as available, and in any event within (i) 15 days
after the end of each calendar month of each fiscal year of the
Borrower, beginning with the month ending June 30, 2000, a copy of
management's cash flow reports comparing actual cash flow results for
the period to the current budget for the period, in a form reasonably
acceptable to the Agent and (ii) 30 days after the end of each calendar
month of each fiscal year of the Borrower, beginning with the month
ending June 30, 2000, a copy of management's operating income
statements comparing actual operating income results for the period to
the current budget for the period, in a form reasonably acceptable to
the Agent.
Page 6
<PAGE> 7
(k) Amendment to Section 10.1. Section 10.1 of the Credit Agreement is
hereby amended and restated to read in its entirety as follows:
"Section 10.1 Maximum Ratio of Total Debt to EBITDA. The
Borrower and its consolidated Subsidiaries will not permit the ratio,
calculated as of the end of each fiscal quarter of the Borrower
commencing with the fiscal quarter ended April 30, 1997, and in
accordance with Section 1.4, of (i) Total Debt to (ii) EBITDA for the
four fiscal quarters of the Borrower then ended to be greater than the
ratio set forth below for the applicable fiscal quarter end:
<TABLE>
<CAPTION>
Fiscal Quarter Ended Maximum Ratio
-------------------- -------------
<S> <C>
April 30, 1997, July 31, 1997, October 31, 1997,
January 31, 1998 and April 30, 1998 3.25 to 1.00
July 31, 1998 and October 31, 1998 3.00 to 1.00
January 31, 1999 3.25 to 1.00
April 30, 1999 3.50 to 1.00
July 31, 1999 3.75 to 1.00
October 31, 1999 3.60 to 1.00
January 31, 2000 3.10 to 1.00
April 30, 2000 3.00 to 1.00
July 31, 2000, October 31, 2000, January 31, 2001 3.50 to 1.00
and April 30, 2001
July 31, 2001 and each fiscal quarter end 3.25 to 1.00"
thereafter
</TABLE>
(l) Amendment to Section 10.2. Section 10.2 of the Credit Agreement is
hereby amended and restated to read in its entirety as follows:
"Section 10.2 Minimum Net Worth. The Borrower and its
consolidated Subsidiaries will at all times maintain Net Worth in an
amount equal to but not less than (a) with respect to each fiscal
quarter ended prior to July 31, 2000, the sum of (i) $33,000,000 plus
(ii) 75% of cumulative Net Income, if positive for any fiscal quarter
(i.e., exclusive of any negative Net Income for any fiscal quarter),
for any fiscal quarter commencing after April 30, 1997, plus (iii) all
Net Proceeds of each Equity Issuance which occurs after April 30, 1997
and (b) with respect to the fiscal quarter ended July 31, 2000 and each
fiscal quarter ended thereafter, $60,025,500.
Page 7
<PAGE> 8
(m) Amendment to Section 10.3. Section 10.3 of the Credit Agreement is
hereby amended and restated to read in its entirety as follows:
"Section 10.3 Minimum Fixed Charge Coverage Ratio. The
Borrower and its consolidated Subsidiaries will not permit the Fixed
Charge Coverage Ratio, calculated as of the end of each fiscal quarter
of the Borrower commencing with the fiscal quarter ended April 30,
1997, and in accordance with Section 1.4, for the four fiscal quarters
of the Borrower then ended to be less than the ratio set forth below
for the applicable fiscal quarter end:
<TABLE>
<CAPTION>
Fiscal Quarter Ended Minimum Ratio
-------------------- -------------
<S> <C>
April 30, 1997, July 31,
1997, October 31, 1997,
January 31, 1998 and
April 30, 1998 1.50 to 1.00
July 31, 1998, and October
31, 1998 1.65 to 1.00
January 31, 1999 and April
30, 1999 1.00 to 1.00
July 31, 1999 1.25 to 1.00
October 31, 1999, January 1.50 to 1.00
31, 2000 and April 30, 2000
July 31, 2000 and
each fiscal quarter end
thereafter 1.10 to 1.00"
</TABLE>
(n) Amendment to Section 10.4. Section 10.4 of the Credit Agreement is
hereby amended and restated to read in its entirety as follows:
"Section 10.4 Capital Expenditures. The Borrower and its
Subsidiaries (a) will not permit the aggregate Capital Expenditures of
the Borrower and its Subsidiaries during the period from February 1,
1999 through and including January 31, 2000 (exclusive of any purchase
or acquisition of Capital Stock or assets permitted by clause (ii) of
Section 9.3) to exceed $3,500,000, (b) will not permit the aggregate
Capital Expenditures of the Borrower and its Subsidiaries during any
period of four consecutive fiscal quarters ended during the period from
April 30, 2000 through and including January 31, 2001 (exclusive of any
purchase or acquisition of Capital Stock or assets permitted by clause
(ii) of Section 9.3) to exceed $3,000,000 and (c) will not permit the
aggregate Capital Expenditures of the Borrower and its Subsidiaries
during any period of four consecutive fiscal quarters
Page 8
<PAGE> 9
ended on or after April 30, 2001 (exclusive of any purchase or
acquisition of Capital Stock or assets permitted by clause (ii) of
Section 9.3) to exceed $3,500,000."
(o) Amendment to Article 13. Article 13 of the Credit Agreement is
hereby amended to add the following new Section 13.26 to read in its entirety as
follows:
"Section 13.26 No Eurodollar Loans. Notwithstanding anything
to the contrary contained in Section 2.4 or elsewhere in this
Agreement, on and after June 28, 2000, all Loans then outstanding or
thereafter advanced or made (if any) shall constitute ABR Loans and
shall bear interest at rates based upon the ABR and the Borrower shall
no longer be entitled to borrow, continue or have outstanding any
Eurodollar Loans."
3. Waiver. Via letter dated February 3, 2000 and otherwise, the
Borrower previously advised the Agent and the Lenders that certain Events of
Default had previously occurred under the Credit Agreement, which Events of
Default which previously occurred are listed on Schedule 3 attached hereto (the
"Waived Events of Default"). The Borrower has requested that the Agent and the
Lenders waive the Waived Events of Default. The Agent and the Lenders hereby
waive the Waived Events of Default and agree not to exercise any rights or
remedies solely as a result of the occurrence thereof. In order to induce the
grant of the waiver contained in this Paragraph 3, each of the Borrower and the
other Loan Parties hereby agrees that the waiver contained in this Paragraph 3
shall be limited strictly as written and shall not be deemed to constitute a
waiver of, or any consent to noncompliance with, any term or provision of this
Agreement or any other Loan Document except as expressly set forth herein.
Furthermore, the waiver contained in this Paragraph 3 shall not constitute a
waiver of any Event of Default that may have occurred after February 3, 2000 or
any future Event of Default that may occur.
4. Conditions Precedent. The effectiveness of this Amendment
(including, without limitation, the waiver contained in Paragraph 3 hereof) is
subject to the satisfaction of each of the following conditions precedent, all
of which conditions precedent must be satisfied on or before June 28, 2000:
(a) The Agent shall have received all of the following in form and
substance satisfactory to the Agent:
(i) Amendment Documents. This Amendment as executed by the
parties hereto and any other agreement, document, instrument or
certificate reasonably required by the Agent or the Lenders to be
executed or delivered by the Borrower or any other Loan Party in
connection with this Amendment, each duly executed by each of the
parties thereto (collectively, the "Amendment Documents");
(ii) Resolutions. Resolutions of the Board of Directors of the
Borrower and the other Loan Parties certified by its Secretary or an
Assistant Secretary which authorize the
Page 9
<PAGE> 10
execution, delivery and performance by the Borrower and the other Loan
Parties of this Amendment and the other Amendment Documents to which
the Borrower or such Loan Party is or is to be a party;
(iii) Extension Fee. The extension fee referred to in
Paragraph 16 of this Amendment;
(iv) Waiver Fee. The waiver fee referred to in Paragraph 17 of
this Amendment;
(v) Fees, Costs and Expenses. All fees, costs and expenses
(including, without limitation, attorneys' fees and expenses) incurred
by the Agent incident to this Amendment or required to be paid in
accordance with Section 13.1 of the Credit Agreement, to the extent
incurred and submitted to the Borrower, shall have been paid in full by
the Borrower; and
(vi) Additional Information. The Agent shall have received
such additional agreements, documents, instruments and information as
the Agent or its legal counsel, Jenkens & Gilchrist, a Professional
Corporation, may reasonably request to effect the transactions
contemplated hereby;
(b) The representations and warranties contained herein and in all
other Loan Documents, as amended hereby, shall be true and correct as of the
date hereof as if made again on and as of the date hereof (except if and to the
extent that such representations and warranties are or were expressly made only
as of another specific date);
(c) All corporate proceedings taken in connection with this Amendment
and the other Amendment Documents, and all legal matters incident thereto, shall
be reasonably satisfactory to the Agent and its legal counsel, Jenkens &
Gilchrist, a Professional Corporation; and
(d) No Default or Event of Default shall have occurred and be
continuing (after giving effect to this Amendment).
5. Condition Subsequent. The effectiveness of this Amendment
(including, without limitation, the waiver contained in Paragraph 3 hereof) is
subject to the condition subsequent that the Borrower shall have delivered to
the Agent and the Lenders, on or before July 10, 2000, the annual audit report
of the Borrower and its consolidated Subsidiaries as of and for the fiscal year
ended July 31, 1999 and all other financial statements, reports, certificates
and other information required to be delivered in accordance with Section
8.1(a), in each case strictly in accordance with and as required by Section
8.1(a). In the event that the condition subsequent set forth in this Paragraph 5
has not been fully and timely satisfied on or before July 10, 2000, this
Amendment shall be, ipso facto, null and void and of no force or effect.
6. Representations and Warranties. Each of the Borrower and the other
Loan Parties hereby jointly and severally represent and warrant to, and agrees
with, the Agent and the Lenders
Page 10
<PAGE> 11
that, as of the date of and after giving effect to this Amendment, (a) the
Subsidiaries of the Borrower identified on Schedule 1 hereto are the only
Subsidiaries of the Borrower, and, with respect to each of the Subsidiaries of
the Borrower, the authorized Capital Stock, the par value per share, the number
of shares issued and outstanding and the owner(s) of such issued and outstanding
shares are as specified on such Schedule 1; (b) each material action, suit,
investigation or proceeding before or by any Governmental Authority or
arbitrator pending or, to the knowledge of any Loan Party, threatened against or
affecting any Loan Party or any Subsidiary of the Borrower as of June 28, 2000,
is disclosed on Schedule 2 hereto, and none of such actions, suits,
investigations or proceedings could, if adversely determined, have a Material
Adverse Effect or could adversely affect the ability of the Borrower and the
other Loan Parties to pay or perform their indebtedness, liabilities or
obligations under the Credit Agreement or the other Loan Documents; (c) the
execution, delivery and performance of this Amendment and any and all other
Amendment Documents executed and/or delivered in connection herewith have been
authorized by all requisite corporate action on the part of the Borrower and the
other Loan Parties and will not violate the Borrower's or any Loan Party's
corporate charter or bylaws; (d) the term Loan Documents as defined in the
Credit Agreement and as used in any of the Loan Documents includes, without
limitation, the Amendment Documents; (e) all representations and warranties set
forth in the Credit Agreement and in the Security Documents are true and correct
as if made again on and as of such date (except if and to the extent that such
representations and warranties were expressly made only as of another specific
date); (f) no Default or Event of Default has occurred and is continuing (after
giving effect to this Amendment); and (g) the Credit Agreement, the Notes, the
Guaranties, the Security Documents and the other Loan Documents (as amended by
this Amendment) are and remain legal, valid, binding and enforceable obligations
of the Borrower and the other Loan Parties (as applicable) which are parties
thereto in accordance with their terms.
7. Governing Law. THIS AMENDMENT AND THE OTHER LOAN DOCUMENTS SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS
(WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES) AND APPLICABLE LAWS OF THE U.S.
8. Counterparts. This Amendment may be executed in any number of
counterparts, all of which when taken together shall constitute one agreement,
and any of the parties hereto may execute this Amendment by signing any such
counterpart.
9. No Oral Agreements. THIS AMENDMENT, TOGETHER WITH THE CREDIT
AGREEMENT AND THE OTHER LOAN DOCUMENTS AS WRITTEN, REPRESENT THE FINAL
AGREEMENTS BETWEEN AND AMONG THE PARTIES HERETO AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN (A) THE BORROWER OR ANY OTHER
LOAN PARTY AND (B) THE AGENT OR ANY LENDER.
Page 11
<PAGE> 12
10. Agreement Remains in Effect; No Waiver. Except as expressly
provided herein, all terms and provisions of the Credit Agreement and the other
the Loan Documents shall remain unchanged and in full force and effect and are
hereby ratified and confirmed. No waiver by the Agent or any Lender of any
Default or Event of Default shall be deemed to be a waiver of any other Default
or Event of Default. No delay or omission by the Agent or any Lender in
exercising any power, right or remedy shall impair such power, right or remedy
or be construed as a waiver thereof or an acquiescence therein, and no single or
partial exercise of any such power, right or remedy shall preclude other or
further exercise thereof or the exercise of any other power, right or remedy
under the Agreement, the Loan Documents or otherwise.
11. Survival of Representations and Warranties. All representations and
warranties made in this Amendment or any other Loan Document shall survive the
execution and delivery of this Amendment and the other Loan Documents, and no
investigation by the Agent or any Lender or any closing shall affect the
representations and warranties or the right of the Agent and the Lenders to rely
upon such representations and warranties.
12. Reference to Credit Agreement. This Amendment shall constitute a
Loan Document. Each of the Loan Documents, including the Credit Agreement, the
Amendment Documents and any and all other agreements, documents or instruments
now or hereafter executed and/or delivered pursuant to the terms hereof or
pursuant to the terms of the Credit Agreement as amended hereby, are (if and to
the extent necessary) hereby amended so that any reference in such Loan
Documents to the Credit Agreement shall mean a reference to the Credit Agreement
as amended hereby.
13. Severability. Any provision of this Amendment held by a court of
competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.
14. Successors and Assigns. This Amendment is binding upon and shall
inure to the benefit of the Agent, the Lenders, the Borrower and the other Loan
Parties and their respective successors and assigns; provided, however, that
neither the Borrower nor any of the other Loan Parties may assign or transfer
any of its rights or obligations hereunder without the prior written consent of
the Lenders.
15. Headings. The headings, captions and arrangements used in this
Amendment are for convenience only and shall not affect the interpretation of
this Amendment.
16. Extension Fee. The Borrower shall pay to the Agent, on or before
the Third Amendment Effective Date, an extension fee in the amount of $65,000,
which extension fee shall be divided pro rata amongst the Lenders based upon
their respective Commitments.
17. Waiver Fee. The Borrower shall pay to the Agent, on or before the
Third Amendment Effective Date, a waiver fee in the amount of $130,000, which
waiver fee shall be
Page 12
<PAGE> 13
divided pro rata amongst the Lenders based upon their respective Commitments.
18. Release. In consideration of the agreements of the Agent and the
Lenders set forth in this Amendment (including, without limitation, the waiver
contained in Paragraph 3 hereof), each of the Borrower, the other Loan Parties
and all of Borrower's and the other Loan Party's heirs, personal
representatives, predecessors, successors and assigns (the "Releasors") hereby
fully releases, remises and forever discharges the Agent, the Lenders and each
of their respective parents and each of their other affiliates and predecessors,
and each and every one of their past and present officers, directors, agents,
employees, servants, partners, shareholders, attorneys and managers, and all of
their respective heirs, personal representatives, predecessors, successors and
assigns (collectively, the "Lender-Related Parties") for, from and against any
and all claims, liens, demands, causes of action, controversies, offsets,
obligations, losses, damages and liabilities of every kind and character
whatsoever, including, without limitation, any action, omission,
misrepresentation or other basis of liability founded either in tort, contract
or equity and the duties arising thereunder (collectively, the "Claims") that
the Releasors, or any of them, has had in the past, or now has, whether known or
unknown, whether asserted or unasserted, by reason of any matter, cause or thing
set forth in, relating to or arising out of, or in any way connected with or
resulting from, the Obligations, the Loan Documents or any real or personal
property now or at any time securing the Obligations. It is the express intent
of the Agent, the Lenders and the Releasors that the release and discharge set
forth in this Paragraph 18 be construed as broadly as possible in favor of the
Lender-Related Parties so as to foreclose forever the assertion by any of the
Releasors of any Claims, as defined above, against the Lender-Related Parties or
any of them.
Page 13
<PAGE> 14
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed and delivered by their duly authorized officers effective as of the day
and year first above written.
THE BORROWER AND ITS SUBSIDIARIES:
DYNAMEX INC.
By: Jeffrey N. MacDowell
-----------------------------
Name: Jeffrey N. MacDowell
---------------------------
Title: Vice President
--------------------------
DYNAMEX OPERATIONS EAST, INC.
By: Jeffrey N. MacDowell
-----------------------------
Name: Jeffrey N. MacDowell
---------------------------
Title: Vice President
--------------------------
DYNAMEX OPERATIONS WEST, INC.
By:
-----------------------------
Name: Jeffrey N. MacDowell
---------------------------
Title: Vice President
--------------------------
ROAD RUNNER TRANSPORTATION, INC.
By:
-----------------------------
Name: Jeffrey N. MacDowell
---------------------------
Title: Vice President
--------------------------
NEW YORK DOCUMENT EXCHANGE
CORPORATION
By:
-----------------------------
Name: Jeffrey N. MacDowell
---------------------------
Title: Vice President
--------------------------
Page 14
<PAGE> 15
U.S.C. MANAGEMENT SYSTEMS, INC.
By:
-----------------------------
Name: Jeffrey N. MacDowell
---------------------------
Title: Vice President
--------------------------
DYNAMEX DEDICATED FLEET SERVICES, INC.
By:
-----------------------------
Name: Jeffrey N. MacDowell
---------------------------
Title: Vice President
--------------------------
CANNONBALL, INC.
By:
-----------------------------
Name: Jeffrey N. MacDowell
---------------------------
Title: Vice President
--------------------------
DYNAMEX CANADA INC.
By:
-----------------------------
Name: Jeffrey N. MacDowell
---------------------------
Title: Vice President
--------------------------
Page 15
<PAGE> 16
THE AGENT AND A LENDER:
Commitment: $20,243,739.19 BANK OF AMERICA, NATIONAL ASSOCIATION,
individually and as the Agent
By:
-----------------------------
Name: Santiago Marchant
---------------------------
Title: Senior Vice President
--------------------------
Page 16
<PAGE> 17
THE CO-AGENTS AND LENDERS:
Commitment: $11,246,521.73 FLEET NATIONAL BANK,
individually and as a Co-Agent
By:
-----------------------------
Name: Joanne P. O'Keefe
---------------------------
Title: Vice President
--------------------------
Page 17
<PAGE> 18
Commitment: $6,747,913.03 BANK AUSTRIA CREDITANSTALT
CORPORATION FINANCE, INC.,
individually and as a Co-Agent
By:
-----------------------------
Name: Robert M. Biringer
---------------------------
Title: Vice President
--------------------------
By:
-----------------------------
Name: John G. Taylor
---------------------------
Title: Vice President
--------------------------
Page 18
<PAGE> 19
ADDITIONAL LENDERS:
Commitment: $6,747,913.03 THE BANK OF NOVA SCOTIA
By:
----------------------------------
Name: F. C. H. Ashby
--------------------------------
Title: Senior Manager Loan Operations
-------------------------------
Page 19
<PAGE> 20
Commitment: $6,747,913.02 BANK ONE, TEXAS, N.A.
By:
------------------------------
Name: C. Dianne Wooley
----------------------------
Title: Vice President
---------------------------
Page 20
<PAGE> 21
EXHIBIT 10.8
SCHEDULE 1
SUBSIDIARIES OF THE BORROWER, ETC.
<TABLE>
<CAPTION>
Shares Issued and Owner(s)
Subsidiary Capital Stock Shares Authorized Outstanding of Shares
---------- ------------- ----------------- ----------- ---------
<S> <C> <C> <C> <C>
Dynamex Canada Inc. Common; Unlimited Common; 100 Common; The Borrower owns 100% of
Preferred Unlimited Preferred 3,750,000 Preferred the Common and Preferred
Shares.
---------------------------------------------------------------------------------------------------------------------------------
Dynamex Operations Common 10,000 Common 1,000 Common The Borrower owns 100% of
East, Inc. the Common Shares.
---------------------------------------------------------------------------------------------------------------------------------
Dynamex Operations Common 10,000 Common 1,000 Common The Borrower owns 100% of
West, Inc. the Common Shares.
---------------------------------------------------------------------------------------------------------------------------------
Road Runner Common (Voting; 25,000 Common 6,545 Voting Common; The Borrower owns 100% of
Transportation, Inc. Non-Voting; Undesignated) (7,000 Voting; 4,363.9998 Non- the Voting Common and
5,000 Non-Voting; Voting Common Non-Voting Common Shares.
13,000 Undesignated)
---------------------------------------------------------------------------------------------------------------------------------
New York Document Common 200 Common 150 Common The Borrower owns 100% of
Exchange Corporation the Common Shares.
---------------------------------------------------------------------------------------------------------------------------------
U.S.C. Management Common 200,000 Common 91.33 Common The Borrower owns 100% of
Systems, Inc. the Common Shares.
---------------------------------------------------------------------------------------------------------------------------------
Alpine Enterprises, Ltd. Class A Voting Common Unlimited of 290 Class A Dynamex Canada Inc. owns
Class B Voting Common each class Voting Common 100% of the Class A
Class C Voting Common Voting Common Shares.
Class D Voting Common
Class A Non-Voting Common
Class B Non-Voting Common
Class C Non-Voting Common
Class D Non-Voting Common
Preference Shares
---------------------------------------------------------------------------------------------------------------------------------
Dynamex Dedicated Fleet Common 10,000 1,000 Common The Borrower owns 100% of
Services, Inc. the Common Shares.
---------------------------------------------------------------------------------------------------------------------------------
Cannonball, Inc. Common 71,450 69,350 The Borrower owns 100% of
the Common Shares.
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 21
<PAGE> 22
SCHEDULE 2
LITIGATION, ETC.
1. The information set forth on Schedule 7.6 to the Credit Agreement is
incorporated herein by reference.
2. In November and December 1998, two class action lawsuits were filed in
the United States District Court for the Northern District of Texas,
naming the Borrower, Richard K. McClelland, the Borrower's Chief
Executive Officer, and Robert P. Capps, the Borrower's former Chief
Financial Officer, as defendants. The lawsuits arise from the
Borrower's November 2, 1998, announcement that it was (i) revising its
results of operations for the year ended July 31, 1998 from that which
had been previously announced on September 16, 1998 and (ii) restating
its results of operations for the third quarter of fiscal 1998 from
that which had been previously reported. On February 5, 1999, the Court
entered an Order consolidating the actions and approved the selection
of three law firms as co-lead counsel. A consolidated and amended
complaint was filed on March 22, 1999. On May 6, 1999, defendants filed
a motion to dismiss the consolidated and amended complaint in its
entirety. On June 14, 1999, the Borrower issued a press release
announcing that the Audit Committee of the Board of Directors had
formed a Special Committee of outside directors to review potentially
unsupportable accounting entries for the third and fourth quarters of
fiscal 1998. On September 17, 1999 the Borrower issued a press release
announcing that the Special Committee had completed its review of the
Borrower's financial reporting and that the Borrower would restate its
previously reported financial results for the fiscal years 1997 and
1998, the first three quarters of the fiscal year 1998 and the first
three quarters of the fiscal year 1999.
On October 14, 1999, pursuant to a stipulation of the parties,
plaintiffs filed a second amended class action complaint. In addition
to the defendants named in the original complaint, the Second Amended
Class Action Complaint named Deloitte & Touche and Deloitte & Touche
LLP (the Court subsequently dismissed Deloitte & Touche LLP without
prejudice pursuant to the stipulation of the parties). The Second
Amended Class Action Complaint alleges that the defendants issued a
series of materially false and misleading statements and omitted
material facts concerning the Borrower's financial condition and
business operations. The lawsuit alleges violations of Sections 11,
12(a)(2) and 15 of the Securities Act of 1933 and Sections 10(b) and
20(a) of the Securities Exchange Act of 1934. The plaintiffs seek
unspecified damages on behalf of all other purchasers of the Borrower's
common stock during the period of September 18, 1997 through and
including September 17, 1999.
Page 22
<PAGE> 23
On December 8, 1999, Dynamex moved to dismiss the complaint in its
entirety on the grounds that plaintiffs complaint fails to meet the
required pleading standards and that the claims are deficient as a
matter of law. Briefing of the motion was completed on June 1, 2000,
and the motion is now awaiting disposition. At this date, no class has
been certified nor has any discovery commenced. The Borrower is unable
to determine the likely outcome of this matter or to reasonably
estimate the amount of loss with respect to this matter.
On April 10, 2000, Reliance Insurance Company filed a notice of action
in the Superior Court of Justice in Ontario, Canada, seeking a
declaratory judgment that defendants in the shareholder class action
are not entitled to reimbursement under the Reliance insurance policy
for losses incurred in connection with that action. The Reliance policy
provides $3 million in excess coverage to supplement the $2 million in
coverage provided to the Borrower pursuant to the underlying policy
issued by American Home Assurance Company.
The Special Committee of the Board of Directors has kept the SEC
apprised of its inquiry and the restatement process. The Borrower has
received an informal request for information from the Staff of the
Commission for documents concerning the circumstances of the proposed
restatement of the Borrower's prior period financial statements. The
Borrower has cooperated with the Commission and produced documents
responsive to its request.
Page 23
<PAGE> 24
SCHEDULE 3
EVENTS OF DEFAULT TO BE WAIVED
<TABLE>
<S> <C>
1. Section 8.1(a); Annual Financial Statements Default as of 10/29/99 for the fiscal year ended 7/31/99
2. Section 8.1(b); Quarterly Financial Statements Default as of 12/15/99 for the fiscal quarter ended
10/31/99, as of 3/15/2000 for the fiscal quarter ended
1/31/2000 and as of 6/15/2000 for the fiscal quarter ended
4/30/2000
3. Section 8.1(c); Compliance Certificate Default as of 10/29/99 for the fiscal year ended 7/31/99,
as of 12/15/99 for the fiscal quarter ended 10/31/99, as of
3/15/2000 for the fiscal quarter ended 1/31/2000 and as of
6/15/2000 for the fiscal quarter ended 4/30/2000
4. Section 8.1(d); Applicable Margin & Fees Default as of 10/29/99 for the fiscal year ended 7/31/99
5. Section 8.1(e); Receivables Agings, Etc. Default for failure to produce accounts receivable and
accounts payable agings
6. Section 8.1(f); Budget Default as of 8/1/99 for failure to timely provide the
budget for the fiscal year ended 7/31/99; budget delivered
1/24/99
7. Section 8.1(h); Notice of Litigation Specific notice regarding Shareholder Litigation not given,
although notice and information regarding such shareholder
litigation was included in all public filings beginning
with the 10-K for the fiscal year ended 7/31/99, was
discussed at bank meetings and updated information was
included in public press releases forwarded to the Lenders
8. Section 8.1(i); Notice of Default Prior to February 1, 2000, no written notice provided
regarding Defaults
</TABLE>
Page 24
<PAGE> 25
<TABLE>
<S> <C>
9. Section 8.1(l); Notice of Material Adverse Effect No written notice was given to the Agent or the Lenders of
potential the Material Adverse Effect resulting from: (a)
Shareholder Litigation as described in Item 7 above, (b)
Special Committee investigation concluding restatement of
prior period financials was necessary, the effect of which
is certain representations contained in Section 7.2(a) of
the Credit Agreement may be inaccurate, and (c) possible
delisting of the Borrower's common stock from the American
Stock Exchange as a result of failure to timely provide
audited financial statements on Form 10-K to the SEC
10. Section 8.1(p); Insurance Default as of May 31, 1999 due to failure to provide
summary of insurance coverage
11. Section 8.5(iv); Insurance - Workers' Comp Potential Default: cancellation notice regarding insurance
coverage was received 1/19/2000, became effective at
12:00am on 2/4/2000
12. Section 8.7; Keeping Books and Records Potential Default given findings of Special Committee as referred to
in Item 9 above and ongoing audit/re-audit
13. Section 8.9; Compliance with Agreements Potential Default given non-compliance with Listing
Agreements of The American Stock Exchange and possible
delisting of the Borrower's common stock, all due to
failure to timely provide audited financial statements on
Form 10-K and Forms 10-Q to the SEC
14. Section 9.13; Modification of Other Agreements Acquisition Documents: the Borrower has agreed to pay
interest on earnout amounts owed, as detailed in schedule
provided to the Lenders on 1/20/2000 and thereafter
updated, from the date payment due
15. Section 9.14; Bank Accounts New accounts have been opened at Bank of America without
prior written consent of the Agent
</TABLE>
Page 25
<PAGE> 26
<TABLE>
<S> <C>
16. Section 10.1; Debt to EBITDA Default for fiscal quarters ended 4/30/97, 7/31/97,
10/31/97, 1/31/98, 4/30/98, 7/31/98, 10/31/98, 1/31/99,
4/30/99, 7/31/99, 10/31/99, 1/31/2000 and 4/30/2000
17. Section 10.2; Minimum Net Worth Default for fiscal quarters ended 7/31/99, 10/31/99,
1/31/2000 and 4/30/2000
18. Section 10.3; Fixed Charge Coverage Default for fiscal quarters ended 4/30/97, 7/31/97,
10/31/97, 1/31/98, 4/30/98, 7/31/98, 10/31/98, 1/31/99,
4/30/99, 7/31/99, 10/31/99, 1/31/2000 and 4/30/2000
19. Section 10.4; Capital Expenditures Default for fiscal quarters ended 1/31/2000 and 4/30/2000
</TABLE>
Page 26
