Exhibit 10(b)

 

FOURTH AMENDMENT TO CREDIT AGREEMENT

AND REAFFIRMATION OF SUBSIDIARY GUARANTY

 

This FOURTH AMENDMENT TO CREDIT AGREEMENT AND  REAFFIRMATION OF SUBSIDIARY
GUARANTY, dated as of February 9, 2005, (the “Fourth Amendment”), entered into
by and among QUIXOTE CORPORATION, a Delaware corporation (the “Borrower”), each
of the LENDER INSTITUTIONS named as Lender on the signature pages hereof,
(individually each a “Lender” and collectively the “Lenders”), those SIGNIFICANT
DOMESTIC INCORPORATED SUBSIDIARIES, as Subsidiary Guarantors named on the
signature pages  hereof (each being referred to herein as a “Guarantor” and
collectively referred to herein as the “Guarantors”), and THE NORTHERN TRUST
COMPANY, as Administrative Agent for itself and the other Lenders, (in such
capacity, together with its successors in such capacity, the “Administrative
Agent”) whose address is 50 South LaSalle Street, Chicago, Illinois 60675.

 

R E C I T A L S:

 

A.                                   The Borrower and the Lenders entered into
that certain Credit Agreement, dated as of May 16, 2003, as amended by a First
Amendment, dated as of December 9, 2003; by a Second Amendment, dated as of
June 30, 2004; and by a Third Amendment, dated as of September 10, 2004
(collectively, the “Credit Agreement”), pursuant to which Credit Agreement the
Lenders have made, (i) Revolving Loans to the Borrower evidenced by certain
Revolving Notes, dated as of September 10, 2004, in the maximum aggregate
principal amount of Thirty Eight Million Dollars and 00/100 ($38,000,000),
executed by the Borrower and made payable pro rata to the order of the Lenders
(the “Revolving Notes”) and (ii) Term Loans to the Borrower evidenced by certain
Term Notes, dated as of May 16, 2003, in the aggregate original principal amount
of Twenty Million Dollars and 00/100 ($20,000,000), executed by the Borrower and
made payable pro rata to the order of the Lenders (the “Term Notes”).

 

B.                                     To comply with the “Indebtedness”
negative covenant set forth in Section 7.3(A) of the Credit Agreement, the
Borrower has informed the Administrative Agent and Lenders of, and requested
that the Agent and Lenders, by amendment to the Credit Agreement, permit
Borrower’s issuance, as of February 9, 2005 of Convertible Senior Subordinated
Notes, due February 15, 2025 (the “New Subordinated Notes”).

 

C.                                     The Administrative Agent and Lenders are
willing to permit Borrower’s issuance of the New Subordinated Notes, provided
Borrower uses the proceeds from such issuance in accordance with the mandatory
prepayment terms set forth in Section 2.4(B)(ii) of the Credit Agreement.

 

NOW THEREFORE, in consideration of the premises and other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
Borrower, the Guarantors, and the Lenders hereby agree as follows:

 

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A G R E E M E N T S:

 

1.                                       RECITALS.  The foregoing Recitals are
hereby made a part of this Fourth Amendment.

 

2.                                       DEFINITIONS.  Capitalized words and
phrases used herein without definition shall have the respective meanings
ascribed to such words and phrases in the Credit Agreement.

 

3.                                       AMENDMENTS TO THE CREDIT AGREEMENT.

 

3.1.                              Section 1.1 of the Credit Agreement. 
Section 1.1 of the Credit Agreement is hereby amended by inserting new
definitions of “Net Costs,” “New Subordinated Debt,” “Offering Documents” and
“Subordinated Debt” to read as follows:

 

““Net Costs” shall mean any and all underwriting, legal, accounting, filing,
printing and directly related costs incurred in connection with issuance of the
New Subordinated Debt, which costs shall be described in a closing statement
prepared and delivered at such Debt closing.

 

“New Subordinated Debt” shall mean the indebtedness evidenced by Borrower’s
Convertible Senior Subordinated Notes, due February, 2025 issued pursuant to the
terms of the Offering Documents.

 

“Offering Documents” shall mean the following:  (i) the Private Placement
Memorandum prepared by management of the Company and delivered to the buyers of
New Subordinated Debt, as defined therein, (ii) an Indenture between Borrower,
as Issuer, and LaSalle Bank National Association, as Trustee, (iii) a Securities
Purchase Agreement, between the Borrower and buyers of New Subordinated Debt,
(iv) a Registration Rights Agreement between the Borrower and buyers of New
Subordinated Debt, and (v) any and all related certificates or legal opinions
issued by Borrower in connection with the issuance of such New Subordinated
Debt, in each case in substantially the form provided to the Administrative
Agent for its review at the time of the Fourth Amendment.

 

“Subordinated Debt” shall mean the (i) Subordinated Note and (ii) the New
Subordinated Debt.”

 

3.2                                 Section 2 of the Loan Agreement. 
Section 2.1 of the Loan Agreement is hereby amended by inserting at the end of
the “provided, however” clause in the first sentence thereof the following:

 

“or shall the proceeds of any Revolving Loan made by the Lenders hereunder be
used to make any payment, (other than for accrued interest) redemption,
repurchase, retirement, defeasance or other acquisition for value of any
Borrower Subordinated Debt.”

 

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3.3                                 Section 2 of the Loan Agreement. 
Section 2.4(B)(ii)(z) is hereby amended and restated to read as follows:

 

“(z)                             an amount equal to 100% of the proceeds (after
deduction and payment of Net Costs) received from the incurrence of Indebtedness
(other than Indebtedness permitted to be incurred pursuant to Section 7.3(A) of
this Agreement, provided, in the case of the New Subordinated Debt permitted
under Section 7.3(A), the mandatory prepayment requirements in this
subsection (z) shall apply).”

 

3.4                                 Section 7 of the Credit Agreement. 
Section 7 of the Credit Agreement is hereby amended as follows:

 

(i)                                     Section 7.3 of the Loan Agreement is
hereby amended to insert a new Section 7.3(A)(x) to read as follows:

 

“(x)                             Indebtedness consisting of the New Subordinated
Debt provided that the proceeds of such New Subordinated Debt (after deduction
and payment of Net Costs) shall be applied in accordance with the mandatory
prepayment terms of Section 2.4(B)(ii) of this Agreement.”

 

(ii)                                  Section 7.3(F) of the Credit Agreement is
hereby amended to insert the following at the end thereof:

 

“, provided Borrower shall not make, without the prior written consent of the
Required Lenders, any Restricted Payment with the proceeds of any Revolving Loan
relating to any Subordinated Debt of Borrower (other than for accrued interest)
as defined under subsection (iii) of the definition of “Restricted Payment” in
Section 1.1 of the Agreement.”

 

4.                                       REAFFIRMATION OF SUBSIDIARY GUARANTY. 
Each of the Guarantors hereby expressly (a) consents to the execution by the
Borrower and the Lenders of this Fourth Amendment, (b) acknowledges that the
“Guaranteed Obligations” (as defined in the Subsidiary Guaranty) includes all of
the obligations and liabilities owing from the Borrower to the Administrative
Agent and Lenders under and pursuant to the Credit Agreement, as amended from
time to time, including, but not limited to, the obligations of the Borrower to
the Administrative Agent and the Lenders  as evidenced by the Revolving Loan
Notes, as modified, extended and/or replaced from time to time, and the Term
Loan Notes, as modified, extended and/or replaced from time to time, (c)
reaffirms, assumes and binds itself in all respects to all of the obligations,
liabilities, duties, covenants, terms and conditions that are contained in the
Subsidiary Guaranty, (d) agrees that all such obligations and liabilities under
the Subsidiary Guaranty shall continue in full force and effect and shall not be
discharged, limited, impaired or affected in any manner whatsoever, except as
expressly provided in the Subsidiary Guaranty, (e) represents and warrants that
each of the representations and warranties made by such Guarantor in any of the
documents executed in connection with the Loans remain true and correct as of
the date hereof, in each case as amended by the information provided in any
report or notice

 

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delivered by the Borrower to the Administrative Agent pursuant to Section 7.1 of
the Credit Agreement, and (f) represents and warrants that the organization
documents, borrowing resolutions and incumbency certificates of such Guarantor
have not been changed or amended since the most recent date that certified
copies thereof were delivered to the Lender.

 

5.                                       REPRESENTATIONS AND WARRANTIES.  To
induce the Lenders to enter into this Fourth Amendment, the Borrower and each
Guarantor hereby certifies, represents and warrants to the Lenders that:

 

5.1.                              Organization.  The Borrower is a corporation
duly organized, existing and in good standing under the laws of the State of
Delaware, with all requisite power to conduct its business as presently
conducted.  The Borrower is duly qualified to do business as a foreign entity
under the laws of each jurisdiction in which the failure to be so qualified
would reasonably be expected to have a Material Adverse Effect in all foreign
jurisdictions wherein the nature of its activities require such qualification or
licensing. The Articles of Incorporation and Bylaws, borrowing resolutions and
incumbency certificate of the Borrower have not been changed or amended since
the most recent date that certified copies thereof were delivered to the
Lenders.  The exact legal name of the Borrower is as set forth in the preamble
of this Fourth Amendment, and the Borrower currently does not conduct, nor has
it during the last five (5) years conducted, business under any other name or
trade name.  The Borrower will not change its name, its organizational
identification number, if it has one, its type of organization, its jurisdiction
of organization or other legal structure other than in accordance with the
Credit Agreement.

 

5.2.                              Authorization.  The Borrower and each
Guarantor are duly authorized to execute and deliver this Fourth Amendment and
is and will continue to be duly authorized to borrow monies under the Credit
Agreement, as amended hereby, and to perform its obligations under the Credit
Agreement, as amended hereby.

 

5.3.                              No Conflicts.  The execution and delivery of
this Fourth Amendment and the performance by the Borrower of its obligations
under the Credit Agreement, as amended hereby, do not and will not conflict with
the articles of incorporation or bylaws of the Borrower or conflict with, result
in a breach of or constitute (with or without notice or lapse of time or both) a
default under any Requirement of Law or Contractual Obligation of the Borrower,
or require termination of any Contractual Obligation, except such breach or
default which individually or in the aggregate could not reasonably be expected
to have a Material Adverse Effect.

 

5.4.                              Validity and Binding Effect.  The Credit
Agreement, as amended hereby, is a legal, valid and binding obligation of the
Borrower, enforceable against the Borrower in accordance with its terms, except
as enforceability may be limited by bankruptcy, insolvency or other similar laws
of general application affecting the enforcement of creditors’ rights or by
general principles of equity.

 

5.5.                              Compliance with Credit Agreement.  The
representation and warranties set forth in Section 6 of the Credit Agreement, as
amended hereby, are true and correct in all material aspects with the same
effect as if such representations and warranties had been made on

 

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the date hereof, with the exception that all references to the financial
statements or filings of the Borrower with the Securities and Exchange
Commission shall mean the financial statements or filings of the Borrower with
the Securities and Exchange Commission most recently delivered to the Lenders,
in each case as amended by the information provided in any report or notice
delivered by the Borrower to the Administrative Agent pursuant to Section 7.1 of
the Credit Agreement, and except for such changes as are specifically permitted
under the Credit Agreement.  In addition, the Borrower has complied with and is
in compliance with all of the covenants set forth in the Credit Agreement, as
amended hereby, including, but not limited to, those set forth in Section 7
thereof.

 

5.6.                              No Default.  As of the date hereof, no Default
or Unmatured Default under the Credit Agreement, as amended hereby, has occurred
or is continuing.

 

5.7.                              No Subordinated Debt Default.  As of the date
hereof, no default under the Subordinated Note or any of the documents securing
the Subordinated Note, or event or condition which, with the giving of notice or
the passage of time, or both, would constitute a default under the Subordinated
Note or any of the documents securing the Subordinated Note, has occurred or is
continuing.

 

5.8.                              No Material Adverse Change.  There has been no
material adverse change in the business condition (financial or otherwise),
operations, performance, properties or prospects of the Borrower and its
Subsidiaries, considered as a whole, from that reflected in the financial
statements most recently delivered to the Lenders.

 

5.9.                              Sarbanes-Oxley Compliance.  The Borrower, the
Borrower’s Chief Executive Officer, and the Borrower’s Chief Financial Officer
are in compliance with all requirements of Section 302 and Section 906 of the
Sarbanes-Oxley Act of 2002 and all rules and regulations related thereto.

 

6A.                             CONDITIONS PRECEDENT.  This Fourth Amendment
shall become effective as of the date above first written after receipt by the
Administrative Agent of the following documents:

 

6.1.                              Fourth Amendment.  This Fourth Amendment
executed by the Borrower, the Guarantors, the Administrative Agent and the
Lenders.

 

6.2                                 Certificate of the Borrower’s Secretary. 
Secretary’s Certificate of Borrower, in form and substance acceptable to the
Administrative Agent, with such attachments as required therein, including,
without limitation, resolutions, incumbency and signatures of signing Authorized
Officers, which resolutions authorize Borrowers’ issuance of the New
Subordinated Debt and its execution of this Fourth Amendment and the Offering
Documents.

 

6.3                                 Closing Statement.  A closing statement,
accompanied by a certificate of the Borrower’s Chief Financial Officer in form
acceptable to the Agent, prepared and delivered at the closing and issuance of
the New Subordinated Debt, which statement describes the Net Costs paid or to be
paid from the proceeds of such Debt issuance.

 

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B.                                     CONDITION SUBSEQUENT

 

6.4                                 Delivery of Final Offering Documents. 
Within three (3) days of the issuance of the New Subordinated Notes, Borrower
will deliver five (5) copies of each finally executed Offering Document, duly
executed by Borrower and each party thereto.

 

7.                                       GENERAL.

 

7.1.                              Governing Law; Severability.  This Fourth
Amendment shall be construed in accordance with and governed by the laws of
Illinois.  Wherever possible each provision of the Credit Agreement and this
Fourth Amendment shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of the Credit Agreement and
this Fourth Amendment shall be prohibited by or invalid under such law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining provisions
of the Credit Agreement and this Fourth Amendment.

 

7.2.                              Successors and Assigns.  This Fourth Amendment
shall be binding upon the Borrower, the Guarantors, the Administrative Agent and
the Lenders and their respective successors and assigns, and shall inure to the
benefit of the Borrower, the Guarantors, the Administrative Agent and the
Lenders and the successors and assigns of the Lenders.

 

7.3.                              Continuing Force and Effect of Loan Documents
and Subsidiary Guaranty.  Except as specifically modified or amended by the
terms of this Fourth Amendment, all other terms and provisions of the Credit
Agreement and the other Loan Documents are incorporated by reference herein, and
in all respects, shall continue in full force and effect.  The Borrower, by
execution of this Fourth Amendment, hereby reaffirms, assumes and binds itself
to all of the obligations, duties, rights, covenants, terms and conditions that
are contained in the Credit Agreement and the other Loan Documents. Each of the
Guarantors, by execution of this Fourth Amendment, hereby reaffirms, assumes and
binds itself to all of the obligations, duties, rights, covenants, terms and
conditions that are contained in the Subsidiary Guaranty.

 

7.4.                              References to Credit Agreement.  Each
reference in the Credit Agreement to “this Agreement”, “hereunder”, “hereof”, or
words of like import, and each reference to the Credit Agreement in any and all
instruments or documents delivered in connection therewith, shall be deemed to
refer to the Credit Agreement, as amended hereby.

 

7.5.                              Expenses.  The Borrower shall pay all costs
and expenses in connection with the preparation of this Fourth Amendment and
other related Loan Documents, including, without limitation, reasonable
attorneys’ fees and time charges of attorneys who may be employees of the
Lenders or any affiliate or parent of the Lenders.  The Borrower shall pay any
and all stamp and other taxes, UCC, trademark or patent search fees, title
report or insurance fees, filing fees and other costs and expenses in connection
with the execution and delivery of this Fourth Amendment and the other
instruments and documents to be delivered hereunder, and agrees to save the
Lenders harmless from and against any and all liabilities with respect to or
resulting from any delay in paying or omission to pay such costs and expenses.

 

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7.6.                              Counterparts.                       This
Fourth Amendment may be executed in any number of counterparts, all of which
shall constitute one and the same agreement.

 

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IN WITNESS WHEREOF, the parties hereto have executed this Fourth Amendment to
Credit Agreement and Reaffirmation of Subsidiary Guaranty as of the date first
above written.

 

 

QUIXOTE CORPORATION

 

A Delaware corporation, as Borrower

 

 

 

By:

/s/ Daniel P. Gorey

 

 

Name:

Daniel P. Gorey

 

Title:

Vice President, Chief Financial Officer & Treasurer

 

 

 

Address:

c/o Quixote Corporation

 

 

35 East Wacker Drive

 

 

Chicago, Illinois 60601

 

Attention:

Daniel P. Gorey

 

 

 

Telephone No.:

(312) 467-6755

 

Facsimile No.:

9312) 467-1356

 

 

 

 

 

QUIXOTE TRANSPORTATION SAFETY, INC.

 

TRANSAFE CORPORATION

 

ENERGY ABSORPTION SYSTEMS, INC.

 

ENERGY ABSORPTION SYSTEMS (AL) LLC

 

SURFACE SYSTEMS, INC.

 

NU-METRICS, INC.

 

HIGHWAY INFORMATION SYSTEMS, INC.

 

U. S. TRAFFIC CORPORATION

 

(formerly known as Green Light Acquisition Corporation)

 

PEEK TRAFFIC CORPORATION,

 

(formerly known as Vision Acquisition Corporation),

 

as Guarantors

 

 

 

By:

/s/ Daniel P. Gorey

 

 

Name:

Daniel P. Gorey

 

Title:

Vice President and Treasurer

 

 

 

Address:

c/o Quixote Corporation

 

 

35 East Wacker Drive

 

 

Chicago, Illinois 60601

 

Attention:

Daniel P. Gorey

 

 

 

Telephone No.:

(312) 467-6755

 

Facsimile No.:

(312) 467-0197

 

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THE NORTHERN TRUST COMPANY, for Itself and,

 

as Administrative Agent for the Lenders

 

 

 

By:

/s/ Erin Sullivan

 

 

Name:

Erin Sullivan

 

Title:

Vice President

 

 

 

Address:

The Northern Trust Company

 

 

50 South LaSalle Street

 

 

Chicago, Illinois 60675

 

Attention:

Erin Sullivan

 

 

 

Telephone No.:

(312) 557-7340

 

Facsimile No.:

(312) 444-7028

 

 

 

 

 

LASALLE BANK NATIONAL ASSOCIATION

 

 

 

By:

/s/ Stephanie Kline

 

 

Name:

Stephanie Kline

 

Title:

Vice President

 

 

 

Address:

LaSalle National Association

 

 

135 South LaSalle Street

 

 

Chicago, Illinois 60603

 

Attention:

Stephanie Kline

 

 

 

Telephone No.:

(312) 904-2771

 

Facsimile No.:

(312) 904-6546

 

 

 

 

 

HARRIS TRUST AND SAVINGS BANK

 

 

 

By:

/s/ Derek R. Cook

 

 

Name:

Derek R. Cook

 

Title:

Vice President

 

 

 

Address:

Harris Trust and Savings Bank

 

 

111 West Monroe Street

 

 

Tenth Floor West

 

 

Chicago, Illinois 60603

 

Attention:

Derek R. Cook

 

 

 

Telephone No.:

(312) 461-3593

 

Facsimile No.:

(312) 461-2591

 

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NATIONAL CITY BANK OF THE MIDWEST

 

(f/k/a National City Bank of Michigan/Illinois)

 

 

 

By:

/s/ Richard Michalik

 

 

Name:

Richard Michalik

 

Title:

Senior Vice President

 

Address:

National City Bank of the Midwest

 

 

(f/k/a National City Bank of Michigan/Illinois)

 

 

One North Franklin

 

 

36th Floor

 

 

Chicago, Illinois 60606

 

Attention:

Richard Michalik

 

Telephone No.:

(312) 384-4650

 

Facsimile No.:

(312) 240-0301

 

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