Exhibit 10.1 Credit Facility Waiver
1029052 99581027
August 14, 2000
Transit Group, Inc.
2859 Paces Ferry Road
Atlanta, Georgia 30339
Re: Waiver
Ladies and Gentlemen:
Please refer to the Working Capital Credit Agreement dated as of October 25,
1999 (as previously amended, the "Credit Agreement") and the Acquisition Credit
Agreement dated as of October 25, 1999 (as previously amended, the "Acquisition
Credit Agreement"), each among Transit Group, Inc. (the "Borrower"), various
financial institutions and Bank One, NA, as Agent. Capitalized terms used but
not otherwise defined herein have the respective meanings assigned thereto in
the Credit Agreement.
At the Borrower's request, the Required Lenders (which also constitute "Required
Lenders" under and as defined in the Acquisition Credit Agreement) hereby waive
through September 15, 2000: (a) any failure by the Borrower to comply with
Section 6.24.1 of the Credit Agreement and Section 6.24.1 of the Acquisition
Credit Agreement (minimum Fixed Charge Coverage Ratio) for the period ended June
30, 2000 so long as the ratio described in such Section (calculated based upon
the assumption that Indebtedness under the Acquisition Credit Agreement (except
for the principal installments due December 31, 2000 and March 31, 2001) and
under the Credit Agreement is not included in current maturities of principal
Indebtedness, notwithstanding the accounting treatment thereof) is not less than
0.8 to 1 for such period and (b) any failure by the Borrower to comply with
Section 6.24.2 of the Credit Agreement and Section 6.24.2 of the Acquisition
Credit Agreement (maximum Leverage Ratio) for the period ended June 30, 2000 so
long as the ratio described in such Section is not greater than 4.22 to 1 for
such period. The Borrower acknowledges that the foregoing waivers shall expire
on September 15, 2000 and, absent a further waiver by the Required Lenders or an
amendment to each of the Credit Agreements referred to above, an immediate Event
of Default shall exist. The parties hereto acknowledge that they are discussing
possible amendments to such Credit Agreements, but that no agreements have been
reached regarding such possible amendments, that there is no assurance that the
parties will agree on the terms of such amendments and that nothing set forth
herein constitutes a commitment to reach any agreement on any such terms.
At the Borrower's request, the Required Lenders hereby waive any failure by the
Borrower to comply with Section 2.3(b) of the Credit Agreement (a) for the weeks
ended July 28, 2000 through August 11, 2000, so long as the result of the
Aggregate Outstanding Credit Exposure minus the Borrowing Base (such result, the
"Borrowing1029052 99581027 -2- Base Shortfall") does not exceed $6,236,000 at
the end of any such period, (b) for the week ending August 18, 2000 so long as
the Borrowing Base Shortfall does not exceed $5,200,000 at the end of such
period, (c) for the week ending August 25, 2000 so long as the Borrowing Base
Shortfall does not exceed $4,200,000 at the end of such period and (d) for the
week ending September 1, 2000 so long as the Borrowing Base Shortfall does not
exceed $2,600,000 at the end of such period.
In consideration of the foregoing waivers and consents, the Borrower agrees with
the Agent and the Required Lenders that:
(a) the Borrower will pay the reasonable fees and charges of any financial
advisors (including Freed Maxick ABL Services, Inc. and Norman Levy
Associates, Inc.) retained by the Agent or by counsel to the Agent; and
(b) concurrently with the effectiveness hereof, the Borrower will pay to the
Agent for the account of each Lender a waiver fee equal to 0.125% of the
total of (i) the amount of such Lender's Commitment and (ii) such Lender's
Outstanding Credit Exposure under and as defined in the Acquisition Credit
Agreement.
This letter is limited to the matters specifically set forth herein and shall
not be deemed to constitute a waiver or consent with respect to any other matter
whatsoever. The Lenders reserve all of their rights, powers and remedies under
the Credit Agreement, the Acquisition Credit Agreement and applicable law.
This letter may be executed in counterparts and by the parties hereto on
separate counterparts. This letter shall become effective upon receipt by the
Agent of (a) counterparts hereof (or facsimiles thereof) executed by the
Borrower, the Required Lenders and the Required Lenders under the Acquisition
Credit Agreement and (b) confirmation that the Borrower has paid the waiver fee
referred to above.
This letter shall be governed by the laws of the State of Illinois applicable to
contracts made and to be performed entirely within such State.
Please acknowledge your agreement to the foregoing by signing
and returning a counterpart hereof to the Agent.
BANK ONE, NA, Individually and as Agent
(Main Office Chicago)
By:
Name:
Title:
AMSOUTH BANK
By:
Name:
Title:
BANK OF AMERICA, N.A.
By:
Name:
Title:
COMPASS BANK
By:
Name:
Title:
BRANCH BANKING AND TRUST
By:
Name:
Title:
NATIONAL BANK OF CANADA
By:
Name:
Title:
