EXECUTION VERSION

 

 

 

2015 CREDIT AGREEMENT

 

dated as of January 30, 2015

 

between

 

PATRIOT TRANSPORTATION HOLDING, INC.

 

as Borrower

 

and

 

WELLS FARGO BANK, N.A.

 

as Lender

 

 

 

 

 

 

TABLE OF CONTENTS

 

      Page Article 1 DEFINITIONs; CONSTRUCTION 1   Section 1.1 Definitions 1  
Section 1.2 Classifications of Loans and Borrowings 15   Section 1.3 Accounting
Terms and Determination 15   Section 1.4 Terms Generally 16 Article 2 AMOUNT AND
TERMS OF THE REVOLVING COMMITMENT 16   Section 2.1 General Description of
Facility 16   Section 2.2 Revolving Loans 16   Section 2.3 Procedure for
Borrowings 16   Section 2.4 Reserved 17   Section 2.5 Loan Management Service 17
  Section 2.6 Funding of Borrowings 17   Section 2.7 Interest Elections. 17  
Section 2.8 Optional Reduction and Termination of Revolving Commitment. 18  
Section 2.9 Repayment of Loans 19   Section 2.10 Evidence of Indebtedness. 19  
Section 2.11 Optional Prepayments 19   Section 2.12 Interest on Loans. 20  
Section 2.13 Fees. 20   Section 2.14 Computation of Interest and Fees 21  
Section 2.15 Inability to Determine Interest Rates 21   Section 2.16 Illegality
22   Section 2.17 Increased Costs. 22   Section 2.18 Funding Indemnity 23  
Section 2.19 Taxes. 24   Section 2.20 Payments Generally. 24   Section 2.21
Mitigation of Obligations 25   Section 2.22 Letter of Credit Commitment 25  
Section 2.23 Procedure for Issuance and Reimbursement of Letters of Credit. 25  
Section 2.24 Increased Cost. 26   Section 2.25 Obligations Absolute 26   Section
2.26 Letter of Credit Documents 27 Article 3 CONDITIONS PRECEDENT TO LOANS 27  
Section 3.1 Conditions To Effectiveness 27   Section 3.2 Each Credit Event 29
Article 4 REPRESENTATIONS AND WARRANTIES 29   Section 4.1 Existence; Power 29  
Section 4.2 Organizational Power; Authorization 29   Section 4.3 Governmental
Approvals; No Conflicts 30   Section 4.4 Financial Statements 30   Section 4.5
Litigation and Environmental Matters. 30   Section 4.6 Compliance with Laws and
Agreements 31

 

i

 

 

  Section 4.7 Investment Company Act, Etc. 31   Section 4.8 Taxes 31   Section
4.9 Margin Regulations 31   Section 4.10 ERISA 31   Section 4.11 Ownership of
Property. 31   Section 4.12 Disclosure 32   Section 4.13 Labor Relations 32  
Section 4.14 Subsidiaries 32   Section 4.15 Legal Name 32   Section 4.16 No
Restrictions on Dividends 32   Section 4.17 Solvency 32   Section 4.18 Insurance
33   Section 4.19 Outstanding Indebtedness 33 Article 5 AFFIRMATIVE COVENANTS 33
  Section 5.1 Financial Statements and Other Information 33   Section 5.2
Notices of Material Events 34   Section 5.3 Existence; Conduct of Business 35  
Section 5.4 Compliance with Laws, Etc. 35   Section 5.5 Payment of Obligations
35   Section 5.6 Books and Records 36   Section 5.7 Visitation, Inspection, Etc.
36   Section 5.8 Maintenance of Properties; Insurance 36   Section 5.9 Use of
Proceeds 36   Section 5.10 Additional Subsidiaries 36   Section 5.11 Deposit
Relationship 37 Article 6 FINANCIAL COVENANTS 37   Section 6.1 Leverage Ratio 37
  Section 6.2 Fixed Charge Coverage Ratio 37   Section 6.3 Tangible Net Worth 37
Article 7 NEGATIVE COVENANTS 37   Section 7.1 Indebtedness 37   Section 7.2
Negative Pledge 38   Section 7.3 Fundamental Changes. 39   Section 7.4
Investments, Loans, Etc. 40   Section 7.5 Restricted Payments 41   Section 7.6
Sale of Assets 41   Section 7.7 Transactions with Affiliates 42   Section 7.8
Restrictive Agreements 42   Section 7.9 Sale and Leaseback Transactions 42  
Section 7.10 Hedging Agreements 43   Section 7.11 Amendment to Material
Documents 43   Section 7.12 Permitted Subordinated Indebtedness 43   Section
7.13 Accounting Changes 43   Section 7.14 Name Changes. 43 Article 8 EVENTS OF
DEFAULT 44   Section 8.1 Events of Default 44

 

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Article 9 RESERVED 46 Article 10 MISCELLANEOUS 46   Section 10.1 Notices. 46  
Section 10.2 Waiver; Amendments. 47   Section 10.3 Expenses; Indemnification. 48
  Section 10.4 Successors and Assigns. 49   Section 10.5 Governing Law;
Jurisdiction; Consent to Service of Process. 50   Section 10.6 Arbitration 51  
Section 10.7 Right of Setoff 53   Section 10.8 Counterparts; Integration 53  
Section 10.9 Survival 53   Section 10.10 Severability 54   Section 10.11
Confidentiality 54   Section 10.12 Interest Rate Limitation 54   Section 10.13
US PATRIOT Act Notice 55

 

Schedules           Schedule 4.5 - Environmental Matters Schedule 4.14 -
Subsidiaries Schedule 7.4 - Existing Investments       Exhibits          
Exhibit A - Revolving Credit Note Exhibit B - Reserved Exhibit C - Form of
Subsidiary Guarantee Agreement with Schedule I and Annex I thereto Exhibit D -
Form of Indemnity, Subrogation and Contribution Agreement with Schedule I and
Annex I thereto Exhibit 2.3 - Notice of Revolving Borrowing Exhibit 2.7 - Notice
of Continuation/Conversion Exhibit 3.1(b)(iv) - Form of Secretary’s Certificate
Exhibit 3.1(b)(vii) - Form of Officer’s Certificate Exhibit 3.1(c) - Issued and
Outstanding Letters of Credit       Annexes           Annex I Captive Investment
Policy Statement

 

iii

 

  

2015 CREDIT AGREEMENT

 

THIS 2015 CREDIT AGREEMENT (this “Agreement”) is made and entered into as of
January 30, 2015, by and among PATRIOT TRANSPORTATION HOLDING, INC., a Florida
corporation formerly known as New Patriot Transportation Holding, Inc. (the
“Borrower”) and WELLS FARGO BANK, N.A. (the “Lender”).

 

W I T N E S S E T H:

 

WHEREAS, Patriot Transportation, Inc., of Florida, a Florida corporation
(formerly known as Patriot Transportation Holding, Inc.) and Lender are parties
to a 2012 Amended and Restated Credit Agreement dated as of December 21, 2012,
as amended (the “Original Credit Agreement”); and

 

WHEREAS, the board of directors of Patriot Transportation, Inc., of Florida, has
adopted a plan of reorganization pursuant to which, among other things, Patriot
Transportation, Inc., of Florida, is split into two public companies, FRP
Holdings, Inc., and the Borrower; and

 

WHEREAS, the Borrower has requested, and Bank has agreed to extend to Borrower,
a revolving credit facility in the principal amount of $25,000,000, as more
fully set forth below.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein
contained, the Borrower and the Lender agree as follows:

 

Article 1

DEFINITIONS; CONSTRUCTION

 

Section 1.1      Definitions. In addition to the other terms defined herein, the
following terms used herein shall have the meanings herein specified (to be
equally applicable to both the singular and plural forms of the terms defined):

 

“Affiliate” shall mean, as to any Person, any other Person that directly, or
indirectly through one or more intermediaries, Controls, is Controlled by, or is
under common Control with, such Person.

 

“Applicable Margin” shall mean the respective number of basis points per annum
designated below determined based on the Borrower’s Leverage Ratio:

 

 

 

 

LEVEL  Leverage
Ratio  Applicable Margin
(basis points per annum)       Base Rate  LIBOR1  Commitment Fee I   >=.45 to
.55   100.0    150.0    25.0  II   >=.35 to <.45   75.0    125.0    20.0  III  
<.35   25.0    100.0    15.0                       

; provided, however, that adjustments, if any, to the Applicable Margin based on
changes in the Borrower’s Leverage Ratio as set forth above shall be calculated
by the Lender quarterly, based upon the Borrower’s quarterly financial
statements, on a rolling four quarter basis, and shall become effective (each an
“Interest Rate Change Date”), (i) if interest is based on the Base Rate, on the
third Day after the Lender receives the Covenant Compliance Certificate and/or
the financial statements reflecting such change in the Borrower’s Leverage Ratio
or (ii) if interest is based on LIBOR, on the first Day of the Interest Period
following the Interest Period that the Lender receives the Covenant Compliance
Certificate and/or the financial statements reflecting such change in the
Borrower’s Leverage Ratio; and provided, further, however, if the Borrower shall
fail to deliver any such Covenant Compliance Certificate or financial statements
within the time period required pursuant to this Agreement, then the Applicable
Margin shall be at Level I until the appropriate Covenant Compliance Certificate
or financial statements, as the case may be, are so delivered. The Applicable
Margin as of the Closing Date shall be at [Level III].

 

“Available Amount” means on the calculation date, the maximum amount available
to be drawn under any Letter of Credit.

“Availability Period” shall mean the period from the Closing Date to the
Commitment Termination Date.

 

“Bank Products” shall mean any of the following services provided to Borrower by
Lender (or any Affiliate of a Lender): (a) any treasury or other cash management
services, including deposit accounts, automated clearing house (ACH) origination
and other funds transfer, depository (including cash vault and check deposit),
zero balance accounts and sweeps, return items processing, controlled
disbursement accounts, positive pay, lockboxes and lockbox accounts, account
reconciliation and information reporting, payables outsourcing, payroll
processing, trade finance services, investment accounts and securities accounts,
(b) card services, including credit cards (including purchasing cards and
commercial cards), prepaid cards, including payroll, stored value and gift
cards, merchant services processing, and debit card services and (c) Hedging
Agreements entered into with Lender (or an Affiliate of Lender).

 

 

1 Applies to both Daily One Month LIBOR Loans or Eurodollar Loans.

 

2

 

 

“Base Rate” shall mean at any time the Federal Funds Rate plus 0.5% per annum.

 

“Base Rate Loan” when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, bears interest at a
rate determined by reference to the Base Rate.

 

 “Borrower” shall have the meaning in the introductory paragraph hereof.

 

“Borrowing” shall mean a borrowing consisting of Loans of the same Type, made,
converted or continued on the same date and in the case of Eurodollar Loans, as
to which a single Interest Period is in effect.

 

“Capital Lease Obligations” of any Person shall mean all obligations of such
Person to pay rent or other amounts under any lease (or other arrangement
conveying the right to use) of real or personal property, or a combination
thereof, which obligations are required to be classified and accounted for as
capital leases on a balance sheet of such Person under GAAP, and the amount of
such obligations shall be the capitalized amount thereof determined in
accordance with GAAP.

 

“Change in Control” shall mean the occurrence of one or more of the following
events: (a) any sale, lease, exchange or other transfer (in a single transaction
or a series of related transactions) of all or substantially all of the assets
of the Borrower to any Person or “group” (within the meaning of the Securities
Exchange Act of 1934 and the rules of the Securities and Exchange Commission
thereunder in effect on the date hereof), (b) the acquisition of ownership,
directly or indirectly, beneficially or of record, by any Person or “group”
(within the meaning of the Securities Exchange Act of 1934 and the rules of the
Securities and Exchange Commission thereunder as in effect on the date hereof)
of thirty percent (30%) or more of the outstanding shares of the voting stock of
the Borrower; or (c) occupation of a majority of the seats (other than vacant
seats) on the board of directors of the Borrower by Persons who were neither (i)
nominated by the current board of directors or (ii) appointed by directors so
nominated.

 

“Change in Law” shall mean (i) the adoption of any applicable law, rule or
regulation after the date of this Agreement, (ii) any change in any applicable
law, rule or regulation, or any change in the interpretation or application
thereof, by any Governmental Authority after the date of this Agreement, or
(iii) compliance by the Lender (or for purposes of Section 2.17(b) or Section
2.24, by the Lender’s holding company, if applicable) with any request,
guideline or directive (whether or not having the force of law) of any
Governmental Authority made or issued after the date of this Agreement.

 

“Closing Date” shall mean January 30, 2015.

 

“Code” shall mean the Internal Revenue Code of 1986, as amended and in effect
from time to time.

 

3

 

 

“Commitment Termination Date” shall mean the earliest of (i) December 1, 2019,
(ii) the date on which the Revolving Commitment is terminated pursuant to
Section 2.8 or (iii) the date on which all amounts outstanding under this
Agreement have been declared or have automatically become due and payable
(whether by acceleration or otherwise).

 

“Consolidated Current Maturities of Long Term Debt” shall mean the portion of
Consolidated Long Term Debt of the Borrower and its Subsidiaries, on a
consolidated basis determined in accordance with GAAP, paid during the twelve
(12) month period ending on the last day of the month prior to the date as of
which said determination is to be made, but excluding any amounts paid during
such period in respect of Consolidated Long Term Debt that was not in default
and which was voluntarily prepaid by the Borrower and its Subsidiaries.

 

“Consolidated EBITDA” shall mean, for the Borrower and its Subsidiaries for any
period, an amount equal to the sum of (a) Consolidated Net Income for such
period plus (b) to the extent deducted in determining Consolidated Net Income
for such period, (i) Consolidated Interest Expense, (ii) Consolidated Income Tax
Expense, and (iii) depreciation, depletion and amortization determined on a
consolidated basis in accordance with GAAP in each case for such period.

 

“Consolidated Income Tax Expense” shall mean, for the Borrower and its
Subsidiaries for any period determined on a consolidated basis in accordance
with GAAP, the aggregate of all present or future taxes, levies, imposts,
duties, deductions, charges or withholdings paid in cash to any Governmental
Authority.

 

“Consolidated Interest Expense” shall mean, for the Borrower and its
Subsidiaries for any period determined on a consolidated basis in accordance
with GAAP, the sum of (i) total cash interest expense, including without
limitation the interest component of any payments in respect of Capital Leases
Obligations capitalized or expensed during such period (whether or not actually
paid during such period) plus (ii) the net amount payable (or minus the net
amount receivable) under Hedging Agreements during such period (whether or not
actually paid or received during such period).

 

“Consolidated Long Term Debt” shall mean, for any period, all Indebtedness of
the Borrower and its Subsidiaries, or any portion thereof, determined on a
consolidated basis and in accordance with GAAP, the maturity of which extends
beyond twelve (12) months from the date of calculation of Consolidated Long Term
Debt.

 

“Consolidated Net Income” shall mean, for any period, the net income (or loss)
of the Borrower and its Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP, but excluding therefrom (to the
extent otherwise included therein) (i) any extraordinary gains or losses, (ii)
any gains attributable to write-ups of assets, (iii) any equity interest of the
Borrower or any Subsidiary of the Borrower in the unremitted earnings of any
Person that is not a Subsidiary and (iv) any income (or loss) of any Person
accrued prior to the date it becomes a Subsidiary or is merged into or
consolidated with the Borrower or any Subsidiary on the date that such Person’s
assets are acquired by the Borrower or any Subsidiary.

 

4

 

 

“Consolidated Net Worth” shall mean, as of any date, the total assets of the
Borrower and its Subsidiaries that would be reflected on the Borrower’s
consolidated balance sheet as of such date prepared in accordance with GAAP,
after eliminating all amounts properly attributable to minority interests, if
any, in the stock and surplus of Subsidiaries, minus the sum of (i) the total
liabilities of the Borrower and its Subsidiaries that would be reflected on the
Borrower’s consolidated balance sheet as of such date prepared in accordance
with GAAP and (ii) the amount of any write-up in the book value of any assets
resulting from a revaluation thereof or any write-up in excess of the cost of
such assets acquired reflected on the consolidated balance sheet of the Borrower
as of such date prepared in accordance with GAAP.

 

“Consolidated Total Capital” shall mean, as of any date of determination with
respect to the Borrower, the sum of (i) Consolidated Total Debt and (ii)
Consolidated Net Worth.

 

“Consolidated Total Debt” shall mean, as of any date of determination, all
Indebtedness of the Borrower and its Subsidiaries that would be reflected on a
consolidated balance sheet of the Borrower prepared in accordance with GAAP as
of such date.

 

“Control” shall mean the power, directly or indirectly, either to (i) vote five
percent (5%) or more of securities having ordinary voting power for the election
of directors (or persons performing similar functions) of a Person or (ii)
direct or cause the direction of the management and policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise.
The terms “Controlling,” “Controlled by,” and “under common Control with” have
meanings correlative thereto.

 

“Covenant Compliance Certificate” shall mean a certificate in such form as may
be acceptable to the Lender, containing all the financial covenants and ratios
with which the Borrower is required to comply during the term of this Agreement
and containing calculations reflecting whether or not the Borrower is in
compliance with each such financial covenant or ratio.

 

“Daily One Month LIBOR” means for any day, the rate of interest equal to LIBOR
then in effect for delivery for a one (1) month period.

 

 “Daily One Month LIBOR Loan” when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, bears
interest at a rate determined by reference to Daily One Month LIBOR.

 

“Default” shall mean any condition or event that, with the giving of notice or
the lapse of time or both, would constitute an Event of Default.

 

“Default Interest” shall have the meaning set forth in Section 2.12(b).

 

“Designated Account” shall mean the demand deposit operating account of Borrower
or Patriot Transportation, Inc., of Florida designated as the account to be used
for the debit or credit of funds in connection with the Loan Management Service
pursuant to Section 2.5 or for the funding of Revolving Loan advances pursuant
to Section 2.6.

 

5

 

 

“Dollar(s)” and the sign “$” shall mean lawful money of the United States of
America.

 

“Environmental Laws” shall mean all laws, rules, regulations, codes, ordinances,
orders, decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by or with any Governmental Authority, relating in
any way to the environment, preservation or reclamation of natural resources,
the management, Release or threatened Release of any Hazardous Material or to
health and safety matters.

 

“Environmental Liability” shall mean any liability, contingent or otherwise
(including any liability for damages, costs of environmental investigation and
remediation, costs of administrative oversight, fines, natural resource damages,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) any actual or alleged violation of
any Environmental Law, (b) the generation, use, handling, transportation,
storage, treatment or disposal of any Hazardous Materials, (c) any actual or
alleged exposure to any Hazardous Materials, (d) the Release or threatened
Release of any Hazardous Materials or (e) any contract, agreement or other
consensual arrangement pursuant to which liability is assumed or imposed with
respect to any of the foregoing.

 

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute.

 

“ERISA Affiliate” shall mean any trade or business (whether or not
incorporated), which, together with the Borrower, is treated as a single
employer under Section 414(b) or (c) of the Code or, solely for the purposes of
Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code.

 

“ERISA Event” shall mean (a) any “reportable event”, as defined in Section 4043
of ERISA or the regulations issued thereunder with respect to a Plan (other than
an event for which the 30-day notice period is waived); (b) the existence with
respect to any Plan of an “accumulated funding deficiency” (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator appointed by the PBGC of any notice relating to an intention to
terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f)
the incurrence by the Borrower or any of its ERISA Affiliates of any liability
with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of
any notice, or the receipt by any Multiemployer Plan from the Borrower or any
ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability
or a determination that a Multiemployer Plan is, or is expected to be, insolvent
or in reorganization, within the meaning of Title IV of ERISA.

 

“Eurodollar” when used in reference to any Loan or Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, bears interest at a rate
determined by reference to the LIBOR.

 

“Event of Default” shall have the meaning provided in Article 8.

 

6

 

 

“Excluded Taxes” shall mean with respect to the Lender or any other recipient of
any payment to be made by or on account of any obligation of the Borrower
hereunder, (a) income or franchise taxes imposed on (or measured by) its net
income by the United States of America, or by the jurisdiction under the laws of
which such recipient is organized or in which its principal office is located
or, in the case of the Lender, in which its applicable lending office is located
and (b) any branch profits taxes imposed by the United States of America or any
similar tax imposed by any other jurisdiction in which the Borrower is located.

 

“Federal Funds Rate” shall mean, for any day, the rate per annum (rounded
upwards, if necessary, to the next 1/8th of 1%) equal to the weighted average of
the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers for the immediately preceding
day, as published by the Federal Reserve Bank of New York; provided that if no
such rate is so published on any day, then the Federal Funds Rate for such day
shall be the rate most recently published.

 

“Fixed Charge Coverage Ratio” shall mean, for any period of four consecutive
fiscal quarters of the Borrower, the ratio of (a) Consolidated EBITDA for such
period less Consolidated Income Tax Expenses to (b) the sum of Consolidated
Interest Expense plus Consolidated Current Maturities of Long Term Debt for such
period.

 

“GAAP” shall mean generally accepted accounting principles in the United States
applied on a consistent basis and subject to the terms of Section 1.3.

 

“Governmental Authority” shall mean the government of the United States of
America, any other nation or any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.

 

“Guarantee” of or by any Person (the “guarantor”) shall mean any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly and
including any obligation, direct or indirect, of the guarantor (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued in support of such Indebtedness or
obligation; provided, that the term “Guarantee” shall not include endorsements
for collection or deposits in the ordinary course of business. The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which the Guarantee is made or,
if not so stated or determinable, the maximum reasonably anticipated liability
in respect thereof (assuming such Person is required to perform thereunder) as
determined by such Person in good faith. The term “Guarantee” used as a verb has
a corresponding meaning.

 

7

 

 

“Guarantors” shall mean Patriot Transportation, Inc., of Florida, and Florida
Rock and Tank Lines, Inc., and any future Subsidiary which is required pursuant
to Section 5.10 to become a Guarantor.

 

“Hazardous Materials” means all explosive or radioactive substances or wastes
and all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental Law.

 

“Hedging Agreements” shall mean interest rate swap, cap or collar agreements,
interest rate future or option contracts, currency swap agreements, currency
future or option contracts, commodity agreements and other similar agreements or
arrangements designed to protect against fluctuations in interest rates,
currency values or commodity values.

 

“Indebtedness” of any Person shall mean, without duplication (i) all obligations
of such Person for borrowed money, (ii) all obligations of such Person evidenced
by bonds, debentures, notes or other similar instruments, (iii) all obligations
of such Person in respect of the deferred purchase price of property or services
(other than trade payables incurred in the ordinary course of business;
provided, that for purposes of Section 8.1(f), trade payables overdue by more
than 120 days shall be included in this definition except to the extent that any
of such trade payables are being disputed in good faith and by appropriate
measures), (iv) all obligations of such Person under any conditional sale or
other title retention agreement(s) relating to property acquired by such Person,
(v) all Capital Lease Obligations of such Person, (vi) all obligations,
contingent or otherwise, of such Person in respect of letters of credit,
acceptances or similar extensions of credit, (vii) all Guarantees of such Person
of the type of Indebtedness described in clauses (i) through (vi) above, (viii)
all Indebtedness of a third party secured by any Lien on property owned by such
Person, whether or not such Indebtedness has been assumed by such Person, (ix)
all obligations of such Person, contingent or otherwise, to purchase, redeem,
retire or otherwise acquire for value any common stock of such Person, and (x)
Off-Balance Sheet Liabilities. The Indebtedness of any Person shall include the
Indebtedness of any partnership or joint venture in which such Person is a
general partner or a joint venturer, except to the extent that the terms of such
Indebtedness provide that such Person is not liable therefor.

 

“Indemnified Taxes” shall mean Taxes other than Excluded Taxes.

 

“Indemnity and Contribution Agreement” shall mean the 2015 Indemnity,
Subrogation and Contribution Agreement, substantially in the form of Exhibit D,
among the Borrower, the Subsidiary Loan Parties and the Lender.

 

8

 

 

“Interest Period” means a period commencing on a New York Business Day and
continuing for one month, two months, three months or six months, as designated
by Borrower in accordance with the applicable provisions of Article 2, during
which all or a portion of the outstanding principal balance of this Note bears
interest determined in relation to LIBOR; provided however, that (i) if the day
after the end of any Interest Period is not a New York Business Day (so that a
new Interest Period could not be selected by Borrower to start on such day),
then such Interest Period shall continue up to, but shall not include, the next
New York Business Day after the end of such Interest Period, unless the result
of such extension would be to cause any immediately following Interest Period to
begin in the next calendar month in which event the Interest Period shall
continue up to, but shall not include, the New York Business Day immediately
preceding the last day of such Interest Period, and (ii) no Interest Period
shall extend beyond the scheduled maturity date hereof.

 

“Lender” shall have the meaning assigned to such term in the opening paragraph
of this Agreement.

 

“Letter of Credit” shall mean any standby letter of credit (or at the Lender’s
discretion, any documentary letter of credit) issued by the Lender pursuant to
Section 2.22 hereof, as it may be modified from time to time. The term “Letter
of Credit” shall not include any letters of credit issued by the Lender other
than pursuant to this Agreement.

 

“Letter of Credit Documents” shall mean such applications and other agreements
as the Lender may require in connection with the issuance of a Letter of Credit,
as they may be modified from time to time.

 

“Letter of Credit Exposure” shall mean the aggregate Available Amount of all
outstanding Letters of Credit as to which the Lender is obligated to make
Revolving Loan advances pursuant to Section 2.23.

 

“Letter of Credit Notice” shall have the meaning set forth in Section 2.23.

 

“Leverage Ratio” shall mean, as of any date of determination with respect to the
Borrower, the ratio of (i) Consolidated Total Debt as of such date to (ii)
Consolidated Total Capital as of such date.

 

“LIBOR” shall mean, for any applicable Interest Period with respect to any
Eurodollar Loan, the rate of interest per annum determined by Bank based on the
rate for United States dollar deposits for delivery on the first day of each
Interest Period for a period approximately equal to such Interest Period as
reported on Reuters Screen LIBOR01 page (or any successor page) at approximately
11:00 a.m., London time, two London Business Days prior to the first day of such
Interest Period (or if not so reported, then as determined by Bank from another
recognized source or interbank quotation)..

 

“Lien” shall mean any mortgage, pledge, security interest, lien (statutory or
otherwise), charge, encumbrance, hypothecation, assignment, deposit arrangement,
or other arrangement having the practical effect of the foregoing or any
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever (including any conditional sale or other title
retention agreement and any capital lease having the same economic effect as any
of the foregoing).

 

9

 

 

“Loan Documents” shall mean, collectively, this Agreement, the Revolving Credit
Note, all Notices of Revolving Borrowing, all Letter of Credit Notices, all
Letter of Credit Documents, the Subsidiary Guarantee Agreement, the Indemnity
and Contribution Agreement, and any and all other instruments, agreements,
documents and writings executed in connection with any of the foregoing, as they
may be modified from time to time.

 

“Loan Management Service” shall mean Lender’s proprietary automated loan
management program that controls the manner in which funds are transferred
between the Designated Account and the Revolving Loan for credit or debit to the
Revolving Loan, or any successor service or product that performs similar
service.

 

“Loan Parties” shall mean the Borrower and the Subsidiary Loan Parties.

 

“Loans” shall mean Base Rate Loans, Daily One Month LIBOR Loans, Eurodollar
Loans and/or LOC Loans, or any of them, as the context shall require.

 

“London Business Day” means any day that is a day for trading by and between
banks in Dollar deposits in the London interbank market.

 

“LOC Fee Payment Date” shall mean the last day of each March, June, September
and December and on the Commitment Termination Date.

 

“LOC Loan” shall have the meaning set forth in Section 2.23.

 

“Material Adverse Effect” shall mean, with respect to any event, act, condition
or occurrence of whatever nature (including any adverse determination in any
litigation, arbitration, or governmental investigation or proceeding), whether
individually or in conjunction with any other event or events, act or acts,
condition or conditions, occurrence or occurrences whether or not related, a
material adverse change in, or a material adverse effect on, (i) the business,
results of operations, financial condition, assets, liabilities or prospects of
the Borrower and of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Loan Parties to perform any of their respective obligations under
the Loan Documents, (iii) the rights and remedies of the Lender under any of the
Loan Documents or (iv) the legality, validity or enforceability of any of the
Loan Documents.

 

“Material Indebtedness” shall mean Indebtedness (other than the Loans) or
obligations in respect of one or more Hedging Agreements, of any one or more of
the Borrower and the Subsidiaries in an aggregate principal amount exceeding
$1,000,000.00. For purposes of determining Material Indebtedness, the “principal
amount” of the obligations of the Borrower or any Subsidiary in respect to any
Hedging Agreement at any time shall be the maximum aggregate amount (giving
effect to any netting agreements) that the Borrower or such Subsidiary would be
required to pay if such Hedging Agreement were terminated at such time.

 

10

 

 

“Moody’s” shall mean Moody’s Investors Service, Inc.

 

“Multiemployer Plan” shall have the meaning set forth in Section 4001(a)(3) of
ERISA.

 

“New York Business Day” shall mean any day except a Saturday, Sunday or any
other day on which commercial banks in New York are authorized or required by
law to close.

 

“Notice of Revolving Borrowing” shall have the meaning set forth in Section 2.3.

 

“Notice of Conversion/Continuation” shall mean the notice given by the Borrower
to the Lender in respect of the conversion or continuation of an outstanding
Borrowing as provided in Section 2.7(b) hereof.

 

“Obligations” shall mean all amounts owing by the Borrower to the Lender
pursuant to or in connection with this Agreement, any other Loan Document or any
Bank Products, including without limitation, all principal, interest (including
any interest accruing after the filing of any petition in bankruptcy or the
commencement of any insolvency, reorganization or like proceeding relating to
the Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding), all reimbursement obligations under the Letter
of Credit Documents, fees, expenses, indemnification and reimbursement payments,
costs and expenses (including all reasonable fees and expenses of counsel to the
Lender incurred pursuant to this Agreement or any other Loan Document), whether
direct or indirect, absolute or contingent, liquidated or unliquidated, now
existing or hereafter arising hereunder or thereunder, together with all
renewals, extensions, modifications or refinancings thereof.

 

“Off-Balance Sheet Liabilities” of any Person shall mean (i) any repurchase
obligation or liability of such Person with respect to accounts or notes
receivable sold by such Person, (ii) any liability of such Person under any sale
and leaseback transactions which do not create a liability on the balance sheet
of such Person, (iii) any liability of such Person under any so-called
“synthetic” lease transaction or (iv) any obligation arising with respect to any
other transaction which is the functional equivalent of or takes the place of
borrowing but which does not constitute a liability on the balance sheet of such
Person.

 

“Other Taxes” shall mean any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made hereunder or from the execution, delivery or enforcement
of, or otherwise with respect to, this Agreement or any other Loan Document.

 

“Participant” shall have the meaning set forth in Section 10.4(b).

 

“Payment Office” shall mean the office of the Lender located at One Independent
Drive, 25th Floor, Jacksonville, Florida 32202, or such other location as to
which the Lender shall have given written notice to the Borrower.

 

“PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA, and any successor entity performing similar functions.

 

11

 

 

“Permitted Encumbrances” shall mean:

 

(a)      Liens imposed by law for taxes not yet delinquent or which are being
contested in good faith by appropriate proceedings and with respect to which
adequate reserves are being maintained in accordance with GAAP;

 

(b)      statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, materialmen and other Liens imposed by law created in the ordinary
course of business for amounts not yet due or which are being contested in good
faith by appropriate proceedings and with respect to which adequate reserves are
being maintained in accordance with GAAP;

 

(c)      pledges and deposits made in the ordinary course of business in
compliance with workers’ compensation, unemployment insurance and other social
security laws or regulations;

 

(d)      deposits to secure the performance of bids, trade contracts, leases,
statutory obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature, in each case in the ordinary course of business;

 

(e)      judgment and attachment Liens not giving rise to an Event of Default or
Liens created by or existing from any litigation or legal proceeding that are
currently being contested in good faith by appropriate proceedings and with
respect to which adequate reserves are being maintained in accordance with GAAP;

 

(f)      easements, zoning restrictions, rights-of-way and similar encumbrances
on real property imposed by law or arising in the ordinary course of business
that do not secure any monetary obligations and do not materially detract from
the value of the affected property or materially interfere with the ordinary
conduct of business of the Borrower and its Subsidiaries taken as a whole; and

 

(g)      Liens arising under ERISA which could not reasonably be expected to
have a Material Adverse Effect;

 

provided, that the term “Permitted Encumbrances” shall not include any Lien
securing Indebtedness.

 

“Permitted Investments” shall mean:

 

(a)      direct obligations of, or obligations the principal of and interest on
which are unconditionally guaranteed by, the United States (or by any agency
thereof to the extent such obligations are backed by the full faith and credit
of the United States), in each case maturing within one year from the date of
acquisition thereof;

 

12

 

 

(b)      commercial paper having the highest rating, at the time of acquisition
thereof, of S&P or Moody’s and in either case maturing within six months from
the date of acquisition thereof;

 

(c)      certificates of deposit, bankers’ acceptances and time deposits
maturing within 180 days of the date of acquisition thereof issued or guaranteed
by or placed with, and money market deposit accounts issued or offered by, any
domestic office of any commercial bank organized under the laws of the United
States or any state thereof which has a combined capital and surplus and
undivided profits of not less than $500,000,000.00;

 

(d)      fully collateralized repurchase agreements with a term of not more than
30 days for securities described in clause (a) above and entered into with a
financial institution satisfying the criteria described in clause (c) above;

 

(e)      investments in money market mutual funds that are registered with the
SEC and subject to Rule 2a-7 of the Investment Company Act of 1940 and have a
net asset value of $1.00;

 

(f)      municipal obligations issued by any state of the United States of
America or any municipality or other political subdivision of any such state
rated at least AAA by S&P, Aaa by Moody’s or AAA by Fitch at the time of
purchase; in each case maturing within one year from the date of acquisition
thereof;

 

(g)      fixed income mutual funds that provide next day liquidity and have a
duration of one year or less; and

 

(h)      with respect to the investments of captive loss funds, investments in
accordance with the investment policy set forth on Annex I.

 

“Permitted Subordinated Debt” shall mean any Indebtedness of the Borrower or any
Subsidiary (i) that is expressly subordinated to the Obligations on terms
reasonably satisfactory to the Lender, and (ii) that is evidenced by an
indenture or other similar agreement that is in a form reasonably satisfactory
to the Lender.

 

“Person” shall mean any individual, partnership, firm, corporation, association,
joint venture, limited liability company, trust or other entity, or any
Governmental Authority.

 

“Plan” means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code or
Section 302 of ERISA, and in respect of which the Borrower or any ERISA
Affiliate is (or, if such plan were terminated, would under Section 4069 of
ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

 

“Regulation D” shall mean Regulation D of the Board of Governors of the Federal
Reserve System, as the same may be in effect from time to time, and any
successor regulations.

 

13

 

 

“Related Parties” shall mean, with respect to any specified Person, such
Person’s Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person’s Affiliates.

 

“Release” means any release, spill, emission, leaking, dumping, injection,
pouring, deposit, disposal, discharge, dispersal, leaching or migration into the
environment (including ambient air, surface water, groundwater, land surface or
subsurface strata) or within any building, structure, facility or fixture.

 

“Responsible Officer” shall mean any of the president, the chief executive
officer, the chief operating officer, the chief financial officer, the treasurer
or a vice president of the Borrower or such other representative of the Borrower
as may be designated in writing by any one of the foregoing with the consent of
the Lender; and, with respect to the financial covenants only, the chief
financial officer or the treasurer of the Borrower.

 

“Restricted Payment” shall have the meaning set forth in Section 7.5.

 

“Revolving Commitment” shall mean the obligation of the Lender to make Revolving
Loans to or for the account of the Borrower in an aggregate principal amount not
exceeding $25,000,000.

 

“Revolving Credit Exposure” shall mean, at any time, the sum of the outstanding
principal amount of Revolving Loan plus the Letter of Credit Exposure.

 

“Revolving Credit Note” shall mean a promissory note of the Borrower payable to
the order of the Lender in the principal amount of the Revolving Commitment, in
substantially the form of Exhibit A, as it may be modified from time to time.

 

“Revolving Loan” shall mean a loan made by the Lender to the Borrower under its
Revolving Commitment, which may either be a Daily One Month LIBOR Loan or a
Eurodollar Loan.

 

“S&P” shall mean Standard & Poor’s.

 

“SPE Subsidiary” shall mean a special purpose Subsidiary of the Borrower
established solely for the purpose of owning a parcel of real property for
permanent financing purposes.

 

“Subordinated Debt Documents” shall mean any indenture, agreement or similar
instrument governing any Permitted Subordinated Debt.

 

“Subsidiary” shall mean, with respect to any Person (the “parent”), any
corporation, partnership, joint venture, limited liability company, association
or other entity the accounts of which would be consolidated with those of the
parent in the parent’s consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, partnership, joint venture, limited liability company,
association or other entity (i) of which securities or other ownership interests
representing more than 50% of the equity or more than 50% of the ordinary voting
power, or in the case of a partnership, more than 50% of the general partnership
interests are, as of such date, owned, Controlled or held, or (ii) that is, as
of such date, otherwise Controlled, by the parent or one or more subsidiaries of
the parent or by the parent and one or more subsidiaries of the parent. Unless
otherwise indicated, all references to “Subsidiary” hereunder shall mean a
Subsidiary of the Borrower.

 

14

 

 

“Subsidiary Guarantee Agreement” shall mean the Subsidiary Guarantee Agreement,
substantially in the form of Exhibit C attached hereto, made by the Subsidiary
Loan Parties in favor of the Lender.

 

“Subsidiary Loan Party” shall mean any Subsidiary that is not a Foreign
Subsidiary or an SPE Subsidiary.

 

“Taxes” shall mean any and all present or future taxes, levies, imposts, duties,
deductions, charges or withholdings imposed by any Governmental Authority.

 

“Type,” when used in reference to a Loan, refers to whether the Loan is a Base
Rate Loan, a Daily One Month LIBOR Loan, or a Eurodollar Loan, and when used in
reference to a Borrowing, refers to whether the Borrowing is a Base Rate
Borrowing, a Daily One Month LIBOR Borrowing, or a Eurodollar Borrowing.

 

“Withdrawal Liability” shall mean liability to a Multiemployer Plan as a result
of a complete or partial withdrawal from such Multiemployer Plan, as such terms
are defined in Part I of Subtitle E of Title IV of ERISA.

 

Section 1.2      Classifications of Loans and Borrowings. For purposes of this
Agreement, Loans may be classified and referred to by Type (e.g. a “Eurodollar
Loan” or “Base Rate Loan” or “Daily One Month LIBOR Loan”). Borrowings also may
be classified and referred to by Type (e.g. “Eurodollar Borrowing”).

 

Section 1.3      Accounting Terms and Determination. Unless otherwise defined or
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared, in accordance with GAAP as
in effect from time to time, applied on a basis consistent (except for such
changes approved by the Borrower’s independent public accountants) with the most
recent audited consolidated financial statement of the Borrower delivered
pursuant to Section 5.1(a); provided, that if the Borrower notifies the Lender
that the Borrower wishes to amend any covenant in Article 6 to eliminate the
effect of any change in GAAP on the operation of such covenant (or if the Lender
notifies the Borrower that the Lender wishes to amend Article 6 for such
purpose), then the Borrower’s compliance with such covenant shall be determined
on the basis of GAAP in effect immediately before the relevant change in GAAP
became effective, until either such notice is withdrawn or such covenant is
amended in a manner satisfactory to the Borrower and the Lender.

 

15

 

 

Section 1.4      Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include”, “includes” and “including” shall
be deemed to be followed by the phrase “without limitation”. The word “will”
shall be construed to have the same meaning and effect as the word “shall”. In
the computation of periods of time from a specified date to a later specified
date, the word “from” means “from and including” and the word “to” means “to but
excluding”. Unless the context requires otherwise (i) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as it was
originally executed or as it may from time to time be amended, supplemented or
otherwise modified (subject to any restrictions on such amendments, supplements
or modifications set forth herein), (ii) any reference herein to any Person
shall be construed to include such Person’s successors and permitted assigns,
(iii) the words “hereof”, “herein” and “hereunder” and words of similar import
shall be construed to refer to this Agreement as a whole and not to any
particular provision hereof, (iv) all references to Articles, Sections, Exhibits
and Schedules shall be construed to refer to Articles, Sections, Exhibits and
Schedules to this Agreement and (v) all references to a specific time shall be
construed to refer to the time in the city and state of the Lender’s principal
office, unless otherwise indicated.

 

Article 2

AMOUNT AND TERMS OF THE REVOLVING COMMITMENT

 

Section 2.1      General Description of Facility. Subject to and upon the terms
and conditions herein set forth, (i) the Lender hereby establishes in favor of
the Borrower a revolving credit facility pursuant to which the Lender agrees (up
to the Revolving Commitment) to make Revolving Loans to the Borrower in
accordance with Section 2.2, and (ii) the Lender agrees to issue Letters of
Credit in accordance with Section 2.22 hereof; provided, that in no event shall
the aggregate principal amount of all outstanding Revolving Loans plus the
aggregate Available Amounts of all outstanding Letters of Credit exceed at any
time the Revolving Commitment from time to time in effect.

 

Section 2.2      Revolving Loans. Subject to the terms and conditions set forth
herein, the Lender agrees to make Revolving Loans to or for the account of the
Borrower, from time to time during the Availability Period, in an aggregate
principal amount outstanding at any time that will not result in the Lender’s
Revolving Credit Exposure exceeding the Revolving Commitment. During the
Availability Period, the Borrower shall be entitled to borrow, prepay and
reborrow Revolving Loans in accordance with the terms and conditions of this
Agreement; provided, that the Borrower may not borrow or reborrow should there
exist a Default or Event of Default.

 

Section 2.3      Procedure for Borrowings. Provided that Lender has expressly
prohibited the Borrower from using the Loan Management Service, the Borrower
shall give the Lender written notice (or telephonic notice promptly confirmed in
writing) of each Borrowing substantially in the form of Exhibit 2.3 attached
hereto (a “Notice of Revolving Borrowing”) (x) prior to 11:00 a.m. one (1) New
York Business Day prior to the requested date of each Daily One Month LIBOR
Borrowing, and (y) prior to 11:00 a.m. three (3) London Business Days prior to
the requested date of each Eurodollar Borrowing. Each Notice of Revolving
Borrowing shall be irrevocable and shall specify: (i) the aggregate principal
amount of such Borrowing, (ii) the date of such Borrowing (which shall be a New
York Business Day), (iii) the Type of such Loan comprising such Borrowing, and
(iv) in the case of a Eurodollar Borrowing, the duration of the initial Interest
Period applicable thereto (subject to the provisions of the definition of
Interest Period). Each Borrowing shall consist entirely of Daily One Month LIBOR
Loans or Eurodollar Loans, as the Borrower may request. The aggregate principal
amount of each Eurodollar Borrowing shall be not less than $100,000.00 or a
larger multiple of $50,000.00. At no time shall the total number of outstanding
Borrowings which consist of Eurodollar Borrowings exceed seven (7). Procedure
for Borrowings.

  

16

 

 

Section 2.4      Reserved.

 

Section 2.5      Loan Management Service. If Lender has separately agreed that
Borrower may use the Loan Management Service, Borrower shall not request and
Lender shall no longer honor a Notice of Revolving Borrowing in accordance with
Section 2.3 and all Borrowings will instead be initiated by Lender and credited
to the Designated Account as Borrowings as of the end of each Business Day in an
amount sufficient to maintain an agreed upon ledger balance in the Designated
Account. If Lender terminates Borrower’s access to the Loan Management Service,
Borrower may continue to request advances as provided in Section 2.3, subject to
the other terms and conditions of this Agreement. Lender shall have no
obligation to make a Revolving Loan advance through the Loan Management Service
after the occurrence of a Default or Event of Default, or in an amount that
would result in the Lender’s Revolving Credit Exposure exceeding the Revolving
Commitment as set forth in Section 2.2 of this Agreement.

 

Section 2.6      Funding of Borrowings. If Lender has not separately agreed that
Borrower may use the Loan Management Service, the Lender will make available
each Loan to be made by it hereunder on the proposed date thereof by crediting
the amount of such Loan, in immediately available funds, by the close of
business on such proposed date, to the Designated Account or, at the Borrower’s
option, by effecting a wire transfer of such amounts to an account designated by
the Borrower to the Lender.

 

Section 2.7      Interest Elections.

 

(a)      If Lender has not separately agreed that Borrower may use the Loan
Management Service, each Borrowing initially shall be of the Type specified in
the applicable Notice of Revolving Borrowing, and in the case of a Eurodollar
Borrowing, shall have an initial Interest Period as specified in such Notice of
Revolving Borrowing. If Lender has separately agreed that Borrower may use the
Loan Management Service, each Borrowing shall initially be made as a Daily One
Month LIBOR Borrowing. Thereafter, the Borrower may elect to convert outstanding
Borrowings into a different Type or to continue such Borrowings, and in the case
of a Eurodollar Borrowing, may elect Interest Periods therefor, all as provided
in this Section. The Borrower may elect different options with respect to
different portions of the affected Borrowing, and the Loans comprising each such
portion shall be considered a separate Borrowing.

 

17

 

 

(b)      To make an election pursuant to this Section, the Borrower shall give
the Lender prior written notice (or telephonic notice promptly confirmed in
writing) of each Borrowing (a “Notice of Conversion/Continuation”) that is to be
converted or continued, as the case may be, (x) prior to 10:00 a.m. one (1) New
York Business Day prior to the requested date of a conversion into a Daily One
Month LIBOR Borrowing, and (y) prior to 11:00 a.m. three (3) London Business
Days prior to a continuation of or conversion into a Eurodollar Borrowing. Each
such Notice of Conversion/Continuation shall be irrevocable and shall specify
(i) the Borrowing to which such Notice of Continuation/Conversion applies and if
different options are being elected with respect to different portions thereof,
the portions thereof that are to be allocated to each resulting Borrowing (in
which case the information to be specified pursuant to clauses (iii) and (iv)
shall be specified for each resulting Borrowing); (ii) the effective date of the
election made pursuant to such Notice of Continuation/Conversion, which shall be
a New York Business Day, (iii) whether the resulting Borrowing is to be a Daily
One Month LIBOR Borrowing or a Eurodollar Borrowing; and (iv) if the resulting
Borrowing is to be a Eurodollar Borrowing, the Interest Period applicable
thereto after giving effect to such election, which shall be a period
contemplated by the definition of “Interest Period.” If any such Notice of
Continuation/Conversion requests a Eurodollar Borrowing but does not specify an
Interest Period, the Borrower shall be deemed to have selected an Interest
Period of one month. The principal amount of any resulting Eurodollar Borrowing
shall satisfy the minimum borrowing amount for Eurodollar Borrowings set forth
in Section 2.3.

 

(c)      If, on the expiration of any Interest Period in respect of any
Eurodollar Borrowing, the Borrower shall have failed to deliver a Notice of
Conversion/Continuation, then, unless such Borrowing is repaid as provided
herein, the Borrower shall be deemed to have elected to convert such Borrowing
to a Daily One Month LIBOR Borrowing. No Borrowing may be converted into, or
continued as, a Eurodollar Borrowing if a Default or an Event of Default exists,
unless the Lender shall have otherwise consented in writing. No conversion of
any Eurodollar Loans shall be permitted except on the last day of the Interest
Period in respect thereof. If Lender has not separately agreed that Borrower may
use the Loan Management Service, any Borrowing for which the Borrower has not
made an election shall be a Daily One Month LIBOR Borrowing. Any Borrowings made
on the Borrower’s behalf pursuant to Section 2.23(b) shall be a Daily One Month
LIBOR Borrowing.

 

Section 2.8      Optional Reduction and Termination of Revolving Commitment.

 

(a)      Unless previously terminated, the Revolving Commitment shall terminate
on the Commitment Termination Date.

 

(b)      Upon at least three (3) New York Business Days prior written notice (or
telephonic notice promptly confirmed in writing) to the Lender (which notice
shall be irrevocable), the Borrower may reduce the Revolving Commitment in part
or terminate the Revolving Commitment in whole; provided, that (i) any partial
reduction pursuant to this Section 2.8 shall be in an amount of at least
$1,000,000.00 and any larger multiple of $500,000.00, and (ii) no such reduction
shall be permitted which would reduce the Revolving Commitment to an amount less
than the outstanding Revolving Credit Exposure of the Lender.

 

18

 

 

Section 2.9      Repayment of Loans. The outstanding principal amount of all
Revolving Loans shall be due and payable (together with accrued and unpaid
interest thereon) on the Commitment Termination Date.

 

Section 2.10    Evidence of Indebtedness.

 

(a)      The Lender shall maintain in accordance with its usual practice
appropriate records evidencing the indebtedness of the Borrower to the Lender
resulting from each Loan made by the Lender from time to time, including (i) the
amounts of principal and interest payable thereon and paid to the Lender from
time to time under this Agreement, (ii) the Revolving Commitment of the Lender,
(iii) the amount of each Loan made hereunder by the Lender, the Type thereof and
the Interest Period applicable thereto, (iv) the date of each continuation
thereof pursuant to Section 2.7, (v) the date of each conversion of all or a
portion thereof to another Type pursuant to Section 2.7, (vi) the date and
amount of any principal or interest due and payable or to become due and payable
from the Borrower to the Lender hereunder in respect of such Loans, (vii) the
date, stated amount, Available Amount and expiration or termination of each
outstanding Letter of Credit, and (viii) both the date and amount of any sum
received by the Lender hereunder from the Borrower in respect of the Loans. The
entries made in such records shall be prima facie evidence of the existence and
amounts of the obligations of the Borrower therein recorded; provided, that the
failure or delay of the Lender in maintaining or making entries into any such
record or any error therein shall not in any manner affect the obligation of the
Borrower to repay the Loans (both principal and unpaid accrued interest) in
accordance with the terms of this Agreement.

 

(b)      The Borrower agrees that it will execute and deliver to the Lender a
Revolving Credit Note, payable to the order of the Lender.

 

Section 2.11   Optional Prepayments. The Borrower shall have the right at any
time and from time to time to prepay any Borrowing, in whole or in part, without
premium or penalty; provided, however, that any prepayment of Eurodollar
Borrowings shall be in a minimum amount of $1,000,000.00 and any larger multiple
of $500,000.00. No prior written notice shall be required in the case of any
prepayment of any Daily One Month LIBOR Borrowing. In the case of prepayment of
any Eurodollar Borrowing, Borrower shall give irrevocable written notice (or
telephonic notice promptly confirmed in writing) to the Lender no later than
11:00 a.m. not less than three (3) New York Business Days prior to any such
prepayment, and each such notice shall be irrevocable and shall specify the
proposed date of such prepayment and the principal amount of each Borrowing or
portion thereof to be prepaid. If such notice is given, the aggregate amount
specified in such notice shall be due and payable on the date designated in such
notice, together with accrued interest to such date on the amount so prepaid in
accordance with Section 2.12(c); provided, that if a Eurodollar Borrowing is
prepaid on a date other than the last day of an Interest Period applicable
thereto, the Borrower shall also pay all amounts required pursuant to Section
2.18. Each partial prepayment of any Loan shall be in an amount that would be
permitted in the case of an advance of a Revolving Borrowing of the same Type
pursuant to Section 2.3. Each prepayment of a Borrowing shall be applied ratably
to the Loans comprising such Borrowing.

 

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Section 2.12    Interest on Loans.

 

(a)      The Borrower shall pay interest (i) on each Daily One Month LIBOR Loan
at the Daily One Month LIBOR rate in effect from time to time, plus the
Applicable Margin in effect from time to time, and (ii) on each Eurodollar Loan
at LIBOR for the applicable Interest Period in effect for such Loan, plus the
Applicable Margin in effect from time to time. In the event that any Loans shall
from time to time be Base Rate Loans, the Borrower shall pay interest on each
Base Rate Loan at the Base Rate in effect from time to time, plus the Applicable
Margin in effect from time to time.

 

(b)      While an Event of Default exists or after acceleration, at the option
of the Lender, the Borrower shall pay interest (“Default Interest”) with respect
to all Eurodollar Loans at the rate otherwise applicable for the then-current
Interest Period plus an additional 2% per annum until the last day of such
Interest Period, and thereafter, and with respect to all Base Rate Loans, all
Daily One Month LIBOR Loans, and all other Obligations hereunder (other than
Loans), at an all-in rate in effect for Base Rate Loans, plus an additional 2%
per annum.

 

(c)      Interest on the principal amount of all Loans shall accrue from and
including the date such Loans are made to but excluding the date of any
repayment thereof. Interest on all outstanding Daily One Month LIBOR Loans and
Base Rate Loans shall be payable quarterly in arrears on the last day of each
March, June, September and December and on the Commitment Termination Date.
Interest on all outstanding Eurodollar Loans shall be payable on the last day of
each Interest Period applicable thereto, and, in the case of any Eurodollar
Loans having an Interest Period in excess of 90 days, on each day which occurs
every 90 days after the initial date of such Interest Period, and on the
Commitment Termination Date. Interest on any Loan which is converted into a Loan
of another Type or which is repaid or prepaid shall be payable on the date of
such conversion or on the date of any such repayment or prepayment (on the
amount repaid or prepaid) thereof. All Default Interest shall be payable on
demand.

 

(d)      The Lender shall determine each interest rate applicable to the Loans
hereunder and shall promptly notify the Borrower of such rate in writing (or by
telephone, promptly confirmed in writing). Any such determination shall be
conclusive and binding for all purposes, absent manifest error.

 

Section 2.13    Fees.

 

(a)      Intentionally omitted.

 

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(b)      Commitment Fee. The Borrower agrees to pay to the Lender a commitment
fee, which shall accrue at the Applicable Margin (determined daily) on the daily
amount of the unused Revolving Loan portion of the Revolving Commitment of the
Lender during the Availability Period; provided, that if the Lender continues to
have any Revolving Credit Exposure after the Commitment Termination Date, then
the commitment fee shall continue to accrue on the amount of the Lender’s unused
Revolving Loan portion of the Revolving Commitment from and after the Commitment
Termination Date to the date that all of the Lender’s Revolving Credit Exposure
has been paid in full. Accrued commitment fees shall be payable quarterly, in
arrears on the last day of each March, June, September and December of each year
and on the Commitment Termination Date, commencing on the first such date after
the Closing Date; provided further, that any commitment fees accruing after the
Commitment Termination Date shall be payable on demand. For purposes of
computing commitment fees with respect to the Revolving Commitment, the
Revolving Commitment shall be deemed used to the extent of the sum of (i) the
outstanding Revolving Loans, plus (ii) the Letter of Credit Exposure.

 

(c)      Upfront Fee. The Borrower shall pay to the Lender a one-time upfront
fee equal to $25,000.00. The upfront fee shall be due and payable on the Closing
Date.

 

(d)      Letter of Credit Fee. On each LOC Fee Payment Date, the Borrower shall
pay, in arrears, to the Lender, a Letter of Credit fee for each Letter of Credit
equal to the greater of (i) Lender’s minimum letter of credit fee, determined in
accordance with Lender’s standard fees and charges then in effect, and (ii) (A)
the average daily outstanding Available Amount of such Letter of Credit since
the most recent LOC Fee Payment Date (or the date of issuance if later) times
(B) the Applicable Margin for LIBOR on a per annum basis. In addition to the
foregoing Letter of Credit fees, the Lender may charge for its own account, fees
for drawings, transfers, amendments and other fees and charges as may be
required under the Letter of Credit Documents.

 

Section 2.14    Computation of Interest and Fees. All computations of interest
and fees hereunder shall be made on the basis of a year of 360 days for the
actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest or fees are payable (to the
extent computed on the basis of days elapsed) except that Letter of Credit Fees
shall be calculated in accordance with the Letter of Credit Documents. Each
determination by the Lender of an interest amount or fee hereunder shall be made
in good faith and, except for manifest error, shall be final, conclusive and
binding for all purposes.

 

Section 2.15    Inability to Determine Interest Rates. If prior to the
commencement of any Interest Period for any Eurodollar Borrowing,

 

(a)      the Lender shall have determined (which determination shall be
conclusive and binding upon the Borrower) that, by reason of circumstances
affecting the relevant interbank market, adequate means do not exist for
ascertaining LIBOR for such Interest Period, or

 

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(b)      the Lender shall have determined that the LIBOR does not adequately and
fairly reflect the cost to the Lender of making, funding or maintaining the
Eurodollar Loans for such Interest Period, the Lender shall give written notice
(or telephonic notice, promptly confirmed in writing) to the Borrower as soon as
practicable thereafter. In the case of Eurodollar Loans and Daily One Month
LIBOR Loans, until the Lender shall notify the Borrower that the circumstances
giving rise to such notice no longer exist, (i) the obligations of the Lender to
make Eurodollar Loans or Daily One Month LIBOR Loans or to continue or convert
outstanding Loans as or into Eurodollar Loans or Daily One Month LIBOR Loans
shall be suspended and (ii) all such affected Daily One Month LIBOR Loans shall
be immediately converted into Base Rate Loans and all such affect Eurodollar
Loans shall be converted into Base Rate Loans on the last day of the then
current Interest Period applicable thereto unless the Borrower prepays such
Loans in accordance with this Agreement. Unless the Borrower notifies the Lender
at least one (1) New York Business Day before the date of any Eurodollar
Revolving Borrowing for which a Notice of Revolving Borrowing has previously
been given that it elects not to borrow on such date, then such Revolving
Borrowing shall be made as a Base Rate Borrowing.

 

Section 2.16    Illegality. If any Change in Law shall make it unlawful or
impossible for the Lender to make, maintain or fund any Eurodollar Loan, the
Lender shall promptly give notice thereof to the Borrower, whereupon until the
Lender notifies the Borrower that the circumstances giving rise to such
suspension no longer exist, the obligation of the Lender to make Eurodollar
Loans or Daily One Month LIBOR Loans, or to continue or convert outstanding
Loans as or into Eurodollar Loans or Daily One Month LIBOR Loans, shall be
suspended. In the case of the making of a Eurodollar Borrowing, such Eurodollar
Borrowing shall be made as a Base Rate Loan as part of the same Borrowing for
the same Interest Period and if the affected Eurodollar Loan is then
outstanding, such Loan shall be converted to a Base Rate Loan either (i) on the
last day of the then current Interest Period applicable to such Eurodollar Loan
if the Lender may lawfully continue to maintain such Loan to such date or (ii)
immediately if the Lender shall determine that it may not lawfully continue to
maintain such Eurodollar Loan to such date. Requests for Base Rate Borrowings
shall be made prior to 11:00 a.m. one (1) New York Business Day prior to the
requested date of each Base Rate Borrowing.

 

Section 2.17    Increased Costs.

 

(a)      If any Change in Law shall:

 

(i)      impose, modify or deem applicable any reserve, special deposit, capital
adequacy or similar requirement that is not otherwise included in the
determination of LIBOR hereunder against assets of, deposits with or for the
account of, or credit extended by, the Lender; or

 

(ii)     impose on the Lender or the Eurodollar interbank market any other
condition affecting this Agreement or any Eurodollar Loans made by the Lender;

 

and the result of the foregoing is to increase the cost to the Lender of making,
converting into, continuing or maintaining a Eurodollar Loan or to reduce the
amount received or receivable by the Lender hereunder (whether of principal,
interest or any other amount), then the Borrower shall promptly pay, upon
written notice from and demand by the Lender on the Borrower, to the Lender,
within five (5) New York Business Days after the date of such notice and demand,
additional amount or amounts sufficient to compensate the Lender for such
additional costs incurred or reduction suffered.

 

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(b)      If the Lender shall have determined that on or after the date of this
Agreement any Change in Law regarding capital requirements has or would have the
effect of reducing the rate of return on the Lender’s capital (or on the capital
of the Lender’s parent corporation) as a consequence of its obligations
hereunder to a level below that which the Lender or the Lender’s parent
corporation could have achieved but for such Change in Law (taking into
consideration the Lender’s policies or the policies of the Lender’s parent
corporation with respect to capital adequacy) then, from time to time, within
five (5) New York Business Days after receipt by the Borrower of written demand
by the Lender, the Borrower shall pay to the Lender such additional amounts as
will compensate the Lender or the Lender’s parent corporation for any such
reduction suffered.

 

(c)      A certificate of the Lender setting forth the amount or amounts
necessary to compensate the Lender or the Lender’s parent corporation, as the
case may be, specified in paragraph (a) or (b) of this Section shall be
delivered to the Borrower and shall be conclusive, absent manifest error. The
Borrower shall pay any the Lender such amount or amounts within 10 days after
receipt thereof.

 

(d)      Failure or delay on the part of the Lender to demand compensation
pursuant to this Section shall not constitute a waiver of the Lender’s right to
demand such compensation; provided, however, that Lender shall waive any right
to demand any such compensation if notice is not provided to Borrower within one
hundred eighty (180) days of a Change in Law giving rise to such demand for
additional compensation.

 

Section 2.18    Funding Indemnity. In the event of (a) the payment of any
principal of a Eurodollar Loan other than on the last day of the Interest Period
applicable thereto (including as a result of an Event of Default), (b) the
conversion or continuation of a Eurodollar Loan other than on the last day of
the Interest Period applicable thereto or (c) the failure by the Borrower to
borrow, prepay, convert or continue any Eurodollar Loan on the date specified in
any applicable notice (regardless of whether such notice is withdrawn or
revoked), in any such event, the Borrower shall compensate the Lender, within
five (5) New York Business Days after written demand from the Lender, for any
loss, cost or expense attributable to such event. In the case of a Eurodollar
Loan, such loss, cost or expense shall be deemed to include an amount determined
by the Lender to be the excess, if any, of (A) the amount of interest that would
have accrued on the principal amount of such Eurodollar Loan if such event had
not occurred at LIBOR applicable to such Eurodollar Loan for the period from the
date of such event to the last day of the then current Interest Period therefor
(or in the case of a failure to borrow, convert or continue, for the period that
would have been the Interest Period for such Eurodollar Loan) over (B) the
amount of interest that would accrue on the principal amount of such Eurodollar
Loan for the same period if LIBOR were set on the date such Eurodollar Loan was
prepaid or converted or the date on which the Borrower failed to borrow, convert
or continue such Eurodollar Loan. A certificate as to any additional amount
payable under this Section 2.18 submitted to the Borrower by the Lender shall be
conclusive, absent manifest error.

 

23

 

 

Section 2.19    Taxes.

 

(a)      Any and all payments by or on account of any obligation of the Borrower
hereunder shall be made free and clear of and without deduction for any
Indemnified Taxes or Other Taxes; provided, that if the Borrower shall be
required to deduct any Indemnified Taxes or Other Taxes from such payments, then
(i) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section) the Lender shall receive an amount equal to the sum it would
have received had no such deductions been made, (ii) the Borrower shall make
such deductions, and (iii) the Borrower shall pay the full amount deducted to
the relevant Governmental Authority in accordance with applicable law.

 

(b)      In addition, the Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable law.

 

(c)      The Borrower shall indemnify the Lender, within five (5) New York
Business Days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes paid by the Lender on or with respect to any
payment by or on account of any obligation of the Borrower hereunder (including
Indemnified Taxes or Other Taxes imposed or asserted on or attributable to
amounts payable under this Section) and any penalties, interest and reasonable
expenses arising therefrom or with respect thereto, whether or not such
Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted
by the relevant Governmental Authority. A certificate as to the amount of such
payment or liability delivered to the Borrower by the Lender shall be conclusive
absent manifest error.

 

(d)      As soon as practicable after any payment of Indemnified Taxes or Other
Taxes by the Borrower to a Governmental Authority, the Borrower shall deliver to
the Lender the original or a certified copy of a receipt issued by such
Governmental Authority evidencing such payment, a copy of the return reporting
such payment or other evidence of such payment reasonably satisfactory to the
Lender.

 

Section 2.20    Payments Generally.

 

(a)      The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees, or of amounts payable under
Section 2.17, Section 2.18 or Section 2.19, or otherwise) prior to 11:00 a.m.,
Jacksonville, Florida time, on the date when due, in immediately available
funds, without set-off or counterclaim. Any amounts received after such time on
any date may, in the discretion of the Lender, be deemed to have been received
on the next succeeding New York Business Day for purposes of calculating
interest thereon. All such payments shall be made to the Lender at the Payment
Office. If any payment hereunder shall be due on a day that is not a New York
Business Day, the date for payment shall be extended to the next succeeding New
York Business Day, and, in the case of any payment accruing interest, interest
thereon shall be made payable for the period of such extension. All payments
hereunder shall be made in Dollars.

 

24

 

 

(b)      If at any time insufficient funds are received by and available to the
Lender to pay fully all amounts of principal, interest and fees then due
hereunder, such funds shall be applied (i) first, towards payment of interest
and fees then due hereunder, ratably among the parties entitled thereto in
accordance with the amounts of interest and fees then due to such parties, and
(ii) second, towards payment of principal then due hereunder, ratably among the
parties entitled thereto in accordance with the amounts of principal then due to
such parties.

 

Section 2.21    Mitigation of Obligations. If the Lender requests compensation
under Section 2.17, or if the Borrower is required to pay any additional amount
to the Lender or any Governmental Authority for the account of the Lender
pursuant to Section 2.19, then the Lender shall use reasonable efforts to
designate a different lending office for funding or booking its Loans hereunder
or to assign its rights and obligations hereunder to another of its offices,
branches or affiliates, if, in the sole judgment of the Lender, such designation
or assignment (i) would eliminate or reduce amounts payable under Section 2.17
or Section 2.19, as the case may be, in the future and (ii) would not subject
the Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to the Lender. The Borrower hereby agrees to pay all costs and
expenses incurred by the Lender in connection with such designation or
assignment.

 

Section 2.22    Letter of Credit Commitment. Subject to the terms and conditions
set forth herein and provided no Default exists, the Lender agrees to issue
Letters of Credit from time to time during the Availability Period; provided,
however, that (a) no Letter of Credit shall have a stated expiration date later
than five (5) New York Business Days prior to the Commitment Termination Date,
as it may be extended, (b) the aggregate Available Amount of all Letters of
Credit outstanding at any time shall not exceed the lesser of (i) $10,000,000.00
and (ii) the difference between the Revolving Commitment and the Revolving
Credit Exposures of the Lender.

 

Section 2.23    Procedure for Issuance and Reimbursement of Letters of Credit.

 

(a)      The Borrower shall give the Lender a written request for the issuance
of a Letter of Credit (a “Letter of Credit Notice”), and shall provide to the
Lender such Letter of Credit Documents as it may require.

 

(b)      Should there occur any drawing under a Letter of Credit, such drawing
shall constitute a Notice of Revolving Borrowing from the Borrower (which the
Borrower hereby irrevocably authorizes) requesting the Lender to make a
Revolving Loan on the date of such drawing in an amount equal to the amount of
such drawing. The proceeds of such Revolving Loan, to be funded in accordance
with Section 2.6, shall be used exclusively for the reimbursement of such
drawing.

 

(c)      If for any reason, a Revolving Loan may not be (as determined in the
sole discretion of the Lender) or is not, made in accordance with the provisions
of Subsection (b) above, then the Lender shall be considered to have made a loan
(the “LOC Loan”) to the Borrower in the amount of such drawing. The LOC Loan
shall be payable on demand, shall be a Base Rate Loan, and shall be an
Obligation hereunder.

 

25

 

 

Section 2.24 Increased Cost.

 

(a)      If a Change of Law or compliance by the Lender with any request or
directive (whether or not having the force of law) of any Governmental Authority
either: (i) shall subject the Lender to any tax, duty or other charge with
respect to any Letter of Credit or its obligations hereunder or under any Letter
of Credit Documents, or (ii) shall impose, modify or deem applicable any
reserve, special deposit insurance or similar requirement (including, without
limitation, any such requirements imposed by the Board of Governors of the
Federal Reserve System) against assets of, deposits with or for the account of,
or credit extended by, the Lender or its parent; or (iii) shall impose on the
Lender or its parent any other similar condition relating to the Letter of
Credit or its obligations hereunder or under any Letter of Credit Documents; and
the result of any of the foregoing is to increase the cost to the Lender or its
parent of making or maintaining the Letter of Credit or its obligations
hereunder or under any Letter of Credit Documents, or to reduce the amount
received or receivable by the Lender or its parent under this Agreement, under
the Letter of Credit or hereunder or under the other Loan Documents with respect
thereto, by an amount deemed by the Lender to be material, the Lender shall
notify the Borrower in writing describing such circumstances and the amount
needed to compensate the Lender or its parent. Within ten (10) days after demand
by the Lender, Borrower shall pay to the Lender such additional amount or
amounts as will compensate the Lender or its parent for such increased cost or
reduction.

 

(b)      If the Lender shall have determined that a Change of Law or compliance
by the Lender with any request or directive regarding capital adequacy (whether
or not having the force of law) of any Authority, has or would have the effect
of reducing the rate of return on the Lender’s (or its parent’s) capital as a
consequence of the issuance or continuance of any Letter of Credit or its
ability to make Loans or LOC Loans upon the occurrence of draws under any Letter
of Credit (taking into consideration the Lender’s (or its parent’s) policies
with respect to capital adequacy), by an amount deemed by the Lender to be
material, then from time to time, the Lender shall notify the Borrower in
writing describing such circumstances and the amount needed to compensate the
Lender or its parent. Within ten (10) days after demand by the Lender, Borrower
shall pay to the Lender such additional amount or amounts as will compensate the
Lender (or its parent’s) for such reduction.

 

(c)      In determining amounts owing pursuant to Subsections (a) and (b), the
Lender may use any reasonable averaging, allocation and attribution methods.

 

Section 2.25    Obligations Absolute. The obligations of Borrower under the
Letter of Credit Documents and this Agreement with respect to reimbursement for
drawings under Letters of Credit shall be absolute, unconditional and
irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement and the Letter of Credit Documents, under all circumstances
whatsoever, including, without limitation, the following circumstances:

 

26

 

 

(a)      any lack of validity or enforceability of the Letter of Credit, any of
the Loan Documents or any other agreement or instrument related thereto;

 

(b)      any amendment or waiver of or any consent to departure from the terms
of the Letter of Credit, any of the Loan Documents or any other agreement or
instrument related thereto;

 

(c)      the existence of any claim, setoff, defense or other right which
Borrower may have at any time against the Lender, any beneficiary or any
transferee of the Letter of Credit (or any Person for whom the Lender, any such
beneficiary or any such transferee may be acting), or any other Person, whether
in connection with this Agreement, the Loan Documents, the Letter of Credit, or
any unrelated transaction;

 

(d)      any statement, draft or other document presented under the Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any respect,
or any statement therein being untrue or inaccurate in any respect whatsoever;
or

 

(e)      the surrender or impairment of any security for the performance or
observance of any of the terms of this Agreement, or any of the other Loan
Documents.

 

Section 2.26    Letter of Credit Documents. The obligations of the Borrower and
rights of the Lender herein with respect to Letters of Credit shall be in
addition to the obligations of the Borrower and rights of the Lender under the
Letter of Credit Documents.

Article 3

CONDITIONS PRECEDENT TO LOANS

 

Section 3.1      Conditions To Effectiveness. The obligation of the Lender to
make Loans and/or issue Letters of Credit hereunder shall not become effective
until the date on which each of the following conditions is satisfied (or waived
in accordance with Section 10.2).

 

(a)      The Lender shall have received all fees and other amounts due and
payable on or prior to the Closing Date, including reimbursement or payment of
all out-of-pocket expenses (including reasonable fees, charges and disbursements
of counsel to the Lender) required to be reimbursed or paid by the Borrower
hereunder, under any other Loan Document and under any agreement with the
Lender.

 

(b)      The Lender (or its counsel) shall have received the following:

 

(i)      a counterpart of this Agreement signed by or on behalf of each party
thereto or written evidence satisfactory to the Lender (which may include
telecopy transmission of a signed signature page of this Agreement) that such
party has signed a counterpart of this Agreement;

 

(ii)     a duly executed Revolving Credit Note payable to the Lender;

 

27

 

 

(iii)    a duly executed Subsidiary Guarantee Agreement and Indemnity and
Contribution Agreement;

 

(iv)    a certificate of the Secretary or Assistant Secretary of each Loan Party
in the form of Exhibit 3.1(b)(iv), attaching and certifying copies of its bylaws
and of the resolutions of its boards of directors, authorizing the execution,
delivery and performance of the Loan Documents to which it is a party and
certifying the name, title and true signature of each officer of such Loan Party
executing the Loan Documents to which it is a party;

 

(v)    certified copies of the articles of incorporation or other charter
documents of each Loan Party, together with certificates of good standing or
existence from the Secretary of State of the jurisdiction of incorporation of
such Loan Party and each other jurisdiction where such Loan Party is required to
be qualified to do business as a foreign corporation;

 

(vi)   a favorable written opinion of counsel to the Loan Parties, addressed to
the Lender, and covering such matters relating to the Loan Parties, the Loan
Documents and the transactions contemplated therein as the Lender shall
reasonably request;

 

(vii)  a certificate in the form of Exhibit 3.1(b)(vii), dated the Closing Date
and signed by a Responsible Officer, confirming compliance with the conditions
set forth in paragraphs (a), (b) and (c) of Section 3.2;

 

(viii) duly executed Notice of Revolving Borrowing, Letter of Credit Notices and
Letter of Credit Documents, if applicable;

 

(ix)    a duly executed Closing Statement and Disbursement Agreement;

 

(x)     certified copies of all consents, approvals, authorizations,
registrations or filings, if any, required to be made or obtained by each Loan
Party in connection with the Loans; and

 

(xi)    all other documents deemed reasonably necessary by the Lender.

 

(c)      Upon the effectiveness of this Agreement, (i) the Lender shall make an
advance under the Revolving Loan in the principal amount of $__________, the
proceeds of which will be used to repay certain revolving loans outstanding
under the Original Credit Agreement advanced for the benefit of the Borrower and
its Subsidiaries, and (ii) the Letters of Credit issued and outstanding under
the Original Credit Agreement and listed on Exhibit 3.1(c) hereto shall
automatically, without further action on the part of Borrower, be deemed to
constitute outstanding letters of credit issued and outstanding under this
Agreement.

 

(d)     Nothing has come to the attention of the Lender regarding (i) pending or
threatened litigation involving the Borrower or any Subsidiary or (ii)
compliance by the Borrower and each Subsidiary with environmental, OSHA and
other public health, safety or welfare laws and regulations, employee benefit
plans or insurance coverages that would be reasonably likely to have a Material
Adverse Effect.

 

28

 

 

Section 3.2      Each Credit Event. The obligation of the Lender to make a Loan
or issue a Letter of Credit is subject to the satisfaction of the following
conditions:

 

(a)      at the time of and immediately after giving effect to such Borrowing or
issuance of a Letter of Credit, no Default or Event of Default shall exist;

 

(b)     all representations and warranties of each Loan Party set forth in the
Loan Documents shall be true and correct in all material respects on and as of
the date of such Borrowing or issuance of a Letter of Credit, in each case
before and after giving effect thereto;

 

(c)      since the date of the most recent financial statements of the Borrower
described in Section 5.1(a), there shall have been no change which has had or
could reasonably be expected to have a Material Adverse Effect;

 

(d)      the Lender shall have received such other documents, certificates,
information or legal opinions as the Lender may reasonably request, all in form
and substance reasonably satisfactory to the Lender; and

 

(e)      with respect to each issuance of a Letter of Credit, the Lender shall
have received all LOC Documents it may require.

 

Each Borrowing or issuance of a Letter of Credit shall be deemed to constitute a
representation and warranty by the Borrower on the date thereof as to the
matters specified in paragraphs (a), (b) and (c) of this Section 3.2.

 

Article 4

REPRESENTATIONS AND WARRANTIES

 

The Borrower represents and warrants to the Lender as follows:

 

Section 4.1      Existence; Power. The Borrower and each of the Guarantors (i)
is duly organized, validly existing and in good standing as a corporation under
the laws of the jurisdiction of its organization, (ii) has all requisite power
and authority to carry on its business as now conducted, and (iii) is duly
qualified to do business, and is in good standing, in each jurisdiction where
such qualification is required, except where a failure to be so qualified could
not reasonably be expected to result in a Material Adverse Effect.

 

Section 4.2      Organizational Power; Authorization. The execution, delivery
and performance by each Loan Party of the Loan Documents to which it is a party
are within such Loan Party’s organizational powers and have been duly authorized
by all necessary organizational, and if required, stockholder action. This
Agreement has been duly executed and delivered by the Borrower, and constitutes,
and each other Loan Document to which any Loan Party is a party, when executed
and delivered by such Loan Party, will constitute, valid and binding obligations
of the Borrower or such Loan Party (as the case may be), enforceable against it
in accordance with their respective terms, except as may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws
affecting the enforcement of creditors’ rights generally and by general
principles of equity.

 

29

 

 

Section 4.3     Governmental Approvals; No Conflicts. The execution, delivery
and performance by the Borrower of this Agreement, and by each Loan Party of the
other Loan Documents to which it is a party (a) do not require any consent or
approval of, registration or filing with, or any action by, any Governmental
Authority, except those as have been obtained or made and are in full force and
effect or where the failure to do so, individually or in the aggregate, could
not reasonably be expected to have a Material Adverse Effect, (b) will not
violate any applicable law or regulation or the charter, bylaws or other
organizational documents of the Borrower or any of its Subsidiaries or any order
of any Governmental Authority, (c) will not violate or result in a default under
any indenture, material agreement or other material instrument binding on the
Borrower or any of its Subsidiaries or any of their assets or give rise to a
right thereunder to require any payment to be made by the Borrower or any of its
Subsidiaries and (d) will not result in the creation or imposition of any Lien
on any asset of the Borrower or any of its Subsidiaries, except Liens (if any)
created under the Loan Documents.

 

Section 4.4     Financial Statements. The Borrower has furnished to the Lender
the audited consolidated balance sheet of Patriot Transportation, Inc., of
Florida (formerly known as Patriot Transportation Holding, Inc.), and its
Subsidiaries as of September 30, 2014. Such financial statements fairly present
the consolidated financial condition of Patriot Transportation, Inc., of Florida
and its Subsidiaries as of such dates and the consolidated results of operations
for such periods in conformity with GAAP consistently applied. Since the date of
the financial statements described above, there have been no changes with
respect to Patriot Transportation, Inc., of Florida and its Subsidiaries which
have had or could reasonably be expected to have, singly or in the aggregate, a
Material Adverse Effect.

 

Section 4.5      Litigation and Environmental Matters.

 

(a)      No litigation, investigation or proceeding of or before any arbitrators
or Governmental Authorities is pending against or, to the knowledge of the
Borrower, threatened against or affecting the Borrower or any of its
Subsidiaries (i) as to which there is a reasonable possibility of an adverse
determination that could reasonably be expected to have, either individually or
in the aggregate, a Material Adverse Effect or (ii) which in any manner draws
into question the validity or enforceability of this Agreement or any other Loan
Document.

 

(b)     Except for the matters set forth on Schedule 4.5, neither the Borrower
nor any of its Subsidiaries (i) to the best of its actual knowledge, has failed
to comply with any Environmental Law or to obtain, maintain or comply with any
permit, license or other approval required under any Environmental Law, (ii) to
the best of its actual knowledge, has become subject to any Environmental
Liability, (iii) has received notice of any claim with respect to any
Environmental Liability or (iv) knows of any basis for any Environmental
Liability.

 

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Section 4.6      Compliance with Laws and Agreements. To the best of its actual
knowledge, the Borrower and each Subsidiary is in compliance with (a) all
applicable laws, rules, regulations and orders of any Governmental Authority,
and (b) all indentures, agreements or other instruments binding upon it or its
properties, except where non-compliance, either singly or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect.

 

Section 4.7      Investment Company Act, Etc. Neither the Borrower nor any of
its Subsidiaries is (a) an “investment company,” as defined in, or subject to
regulation under, the Investment Company Act of 1940, as amended, (b) a “holding
company” as defined in, or subject to regulation under, the Public Utility
Holding Company Act of 1935, as amended or (c) otherwise subject to any other
regulatory scheme limiting its ability to incur debt.

 

Section 4.8      Taxes. The Borrower and its Subsidiaries and each other Person
for whose taxes the Borrower or any Subsidiary could become liable have timely
filed or caused to be filed all Federal income tax returns and all other
material tax returns that are required to be filed by them, and have paid all
taxes shown to be due and payable on such returns or on any assessments made
against it or its property and all other taxes, fees or other charges imposed on
it or any of its property by any Governmental Authority, except (i) to the
extent the failure to do so would not have a Material Adverse Effect or (ii)
where the same are currently being contested in good faith by appropriate
proceedings and for which the Borrower or such Subsidiary, as the case may be,
has set aside on its books adequate reserves. The charges, accruals and reserves
on the books of the Borrower and its Subsidiaries in respect of such taxes are
adequate, and no tax liabilities that could be materially in excess of the
amount so provided are anticipated.

 

Section 4.9      Margin Regulations. None of the proceeds of any of the Loans
will be used for “purchasing” or “carrying” any “margin stock” with the
respective meanings of each of such terms under Regulation U as now and from
time to time hereafter in effect or for any purpose that violates the provisions
of the applicable Margin Regulations.

 

Section 4.10    ERISA. No ERISA Event has occurred or is reasonably expected to
occur that, when taken together with all other such ERISA Events for which
liability is reasonably expected to occur, could reasonably be expected to
result in a Material Adverse Effect. The present value of all accumulated
benefit obligations under each Plan (based on the assumptions used for purposes
of Statement of Financial Standards No. 87) did not, as of the date of the most
recent financial statements reflecting such amounts, exceed the fair market
value of the assets of such Plan, and the present value of all accumulated
benefit obligations of all underfunded Plans (based on the assumptions used for
purposes of Statement of Financial Standards No. 87) did not, as of the date of
the most recent financial statements reflecting such amounts, exceed the fair
market value of the assets of all such underfunded Plans.

 

Section 4.11    Ownership of Property.

 

(a)      Each of the Borrower and its Subsidiaries has good title to, or valid
leasehold interests in, all of its real and personal property material to the
operation of its business.

 

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(b)      Each of the Borrower and its Subsidiaries owns, or is licensed, or
otherwise has the right, to use, all patents, trademarks, service marks, trade
names, copyrights and other intellectual property material to its business, and
the use thereof by the Borrower and its Subsidiaries does not infringe on the
rights of any other Person, except for any such infringements that, individually
or in the aggregate, would not have a Material Adverse Effect.

 

Section 4.12   Disclosure. The Borrower has disclosed to the Lender all
agreements, instruments, and corporate or other restrictions to which the
Borrower or any of its Subsidiaries is subject, and all other matters known to
any of them, that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect. None of the reports (including
without limitation all reports that the Borrower is required to file with the
Securities and Exchange Commission), financial statements, certificates or other
information furnished by or on behalf of the Borrower to the Lender in
connection with the negotiation of this Agreement or any other Loan Document or
delivered hereunder or thereunder (as modified or supplemented by any other
information so furnished) contain any material misstatement of fact or omits to
state any material fact necessary to make the statements therein, taken as a
whole, in light of the circumstances under which they were made, not misleading.

 

Section 4.13    Labor Relations. There are no strikes, lockouts or other
material labor disputes or grievances against the Borrower or any of its
Subsidiaries, or, to the Borrower’s knowledge, threatened against or affecting
the Borrower or any of its Subsidiaries, and no significant unfair labor
practice, charges or grievances are pending against the Borrower or any of its
Subsidiaries, or to the Borrower’s knowledge, threatened against any of them
before any Governmental Authority. All payments due from the Borrower or any of
its Subsidiaries pursuant to the provisions of any collective bargaining
agreement have been paid or accrued as a liability on the books of the Borrower
or any such Subsidiary, except where the failure to do so could not reasonably
be expected to have a Material Adverse Effect.

 

Section 4.14    Subsidiaries. Schedule 4.14 sets forth the name of, the
ownership interest of the Borrower in, the jurisdiction of incorporation of, and
the type of, each Subsidiary and identifies each Subsidiary that is a Subsidiary
Loan Party, in each case as of the Closing Date.

 

Section 4.15    Legal Name. The exact legal name of the Borrower, including
spelling and punctuation, as such name appears in its articles of incorporation,
is as set forth in the preamble hereof. The Borrower’s state issued
organizational identification number is P14000065418.

 

Section 4.16    No Restrictions on Dividends. There are no restrictions on
dividends or repayment of intercompany loans in any agreements of any Subsidiary
Loan Party.

 

Section 4.17    Solvency. The fair saleable value of the Borrower’s assets,
measured on a going concern basis, exceeds all probable liabilities, including
those to be incurred pursuant to this Agreement. Neither the Borrower nor any
Subsidiary has incurred, or believes that it will incur after giving effect to
the transactions contemplated by this Agreement, debts beyond its ability to pay
such debts as they become due.

 

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Section 4.18    Insurance. The property and liability insurance maintained by
the Borrower and its Subsidiaries on and as of the date hereof complies in all
respects with the requirements set forth in Section 5.8. All such insurance
policies are in full force and effect. All premiums (if any) due on such
insurance policies or renewals thereof have been paid and there is no default
under any of such insurance policies. Neither the Borrower nor its Subsidiaries
have received any notice or other communication from any issuer of such
insurance policies canceling or materially amending any such insurance policies,
any deductibles or retained amounts thereunder, or the annual or other premiums
payable thereunder, and no such cancellation or material amendment is
threatened.

 

Section 4.19    Outstanding Indebtedness. On the date of this Agreement, the
Borrower has no outstanding Indebtedness except (i) as reflected on the
financial statements of the Borrower which have been provided to the Lender or
disclosed in Schedule 7.1 attached hereto and (ii) Indebtedness incurred in the
ordinary course of business subsequent to the date of such financial statements.

 

Article 5

AFFIRMATIVE COVENANTS

 

The Borrower covenants and agrees that so long as the Lender has a Revolving
Commitment hereunder or the principal of and interest on any Loan or any fee
remains unpaid:

 

Section 5.1      Financial Statements and Other Information. The Borrower will
deliver to the Lender:

 

(a)      as soon as available and in any event within 90 days after the end of
each fiscal year of Borrower, (i) a copy of the annual audited report for such
fiscal year for the Borrower and its Subsidiaries, containing a consolidated
balance sheet of the Borrower and its Subsidiaries as of the end of such fiscal
year and the related consolidated statements of income, stockholders’ equity and
cash flows (together with all footnotes thereto) of the Borrower and its
Subsidiaries for such fiscal year, setting forth in each case in comparative
form the figures for the previous fiscal year, all in reasonable detail and
reported on by Hancock Askew & Co. LLP or other independent certified public
accountants of nationally recognized standing chosen by Borrower and acceptable
to the Lender (without a “going concern” or like qualification, exception or
explanation and without any qualification or exception as to scope of such
audit), to the effect that such financial statements present fairly in all
material respects the financial condition and the results of operations of the
Borrower and its Subsidiaries for such fiscal year on a consolidated basis in
accordance with GAAP and that the examination by such accountants in connection
with such consolidated financial statements has been made in accordance with
generally accepted auditing standards and (ii) annual unaudited consolidating
balance sheets and income statements for the Borrower and its Subsidiaries;

 

33

 

 

(b)     as soon as available and in any event within 45 days after the end of
each of the first three fiscal quarters of each fiscal year of the Borrower, (i)
an unaudited consolidated balance sheet of the Borrower and its Subsidiaries as
of the end of such fiscal quarter with comparative information for the previous
year end, (ii) the related unaudited consolidated statements of income of the
Borrower and its Subsidiaries for such fiscal quarter and the then elapsed
portion of such fiscal year, setting forth in each case in comparative form the
figures for the corresponding quarter and the corresponding portion of
Borrower’s previous fiscal year, and (iii) consolidated statements of cash flow
for the then elapsed portion of such fiscal year with comparative information
for the corresponding portion of the previous fiscal year, all certified by the
chief financial officer or treasurer of the Borrower as presenting fairly in all
material respects the financial condition and results of operations of the
Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP,
subject to normal year-end audit adjustments and the absence of footnotes;

 

(c)      concurrently with the delivery of the financial statements or
information referred to in clauses (a) and (b) above, (i) a certificate of a
Responsible Officer, (1) certifying, to the best of his actual knowledge, as to
whether there exists a Default or Event of Default on the date of such
certificate, and if a Default or an Event of Default then exists, specifying the
details thereof and the action which the Borrower has taken or proposes to take
with respect thereto and (2) stating whether any change in GAAP or the
application thereof has occurred since the date of the Borrower’s audited
financial statements referred to in Section 4.4 and, if any change has occurred,
specifying the effect of such change on the financial statements accompanying
such certificate and (ii) a Covenant Compliance Certificate;

 

(d)      promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed with the
Securities and Exchange Commission, or any Governmental Authority succeeding to
any or all functions of said Commission, or with any national securities
exchange, or distributed by the Borrower to its shareholders generally, as the
case may be;

 

(e)      not later than sixty days prior to the beginning of each fiscal year
following the Closing Date, an operating budget for the succeeding fiscal year
in form and substance reasonably acceptable to the Lender; and

 

(f)       promptly following any request therefor, such other information
regarding the results of operations, business affairs and financial condition of
the Borrower or any Subsidiary as the Lender may reasonably request.

 

Section 5.2      Notices of Material Events. The Borrower will furnish to the
Lender prompt written notice of the following:

 

(a)      the occurrence of any Default or Event of Default;

 

(b)      the filing or commencement of any action, suit or proceeding by or
before any arbitrator or Governmental Authority against or, to the knowledge of
the Borrower, affecting the Borrower or any Subsidiary which, if adversely
determined, could reasonably be expected to result in a Material Adverse Effect;

 

34

 

 

(c)      the occurrence of any event or any other development by which the
Borrower or any of its Subsidiaries (i) fails to comply with any Environmental
Law or to obtain, maintain or comply with any permit, license or other approval
required under any Environmental Law, (ii) becomes subject to any Environmental
Liability, (iii) receives notice of any claim with respect to any Environmental
Liability, or (iv) becomes aware of any basis for any Environmental Liability
and in each of the preceding clauses, which individually or in the aggregate,
could reasonably be expected to result in a Material Adverse Effect;

(d)      the occurrence of any ERISA Event that alone, or together with any
other ERISA Events that have occurred, could reasonably be expected to result in
a Material Adverse Effect;

 

(e)      the acquisition or formation of a new Subsidiary;

 

(f)       transfers of assets to non-Material Subsidiaries outside the ordinary
course of business; and

 

(g)      any other development that results in, or could reasonably be expected
to result in, a Material Adverse Effect.

 

Each notice delivered under this Section shall be accompanied by a written
statement of a Responsible Officer setting forth the details of the event or
development requiring such notice and any action taken or proposed to be taken
with respect thereto.

 

Section 5.3      Existence; Conduct of Business. The Borrower will, and will
cause each of its Subsidiaries to, do or cause to be done all things necessary
to preserve, renew and maintain in full force and effect its legal existence and
its respective rights, licenses, permits, privileges, franchises, patents,
copyrights, trademarks and trade names material to the conduct of its business
and will continue to engage in substantially the same business as presently
conducted or such other businesses that are reasonably related thereto;
provided, that nothing in this Section shall prohibit any merger, consolidation,
liquidation or dissolution permitted under Section 7.3.

 

Section 5.4      Compliance with Laws, Etc. The Borrower will, and will cause
each of its Subsidiaries to, comply with all laws, rules, regulations and
requirements of any Governmental Authority applicable to its properties, except
where the failure to do so, either individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.

 

Section 5.5      Payment of Obligations. The Borrower will, and will cause each
of its Subsidiaries to, pay and discharge at or before maturity, all of its
obligations and liabilities (including without limitation all tax liabilities
and claims that could result in a statutory Lien) before the same shall become
delinquent or in default, except where (a) the validity or amount thereof is
being contested in good faith by appropriate proceedings, (b) the Borrower or
such Subsidiary has set aside on its books adequate reserves with respect
thereto in accordance with GAAP and (c) the failure to make payment pending such
contest could not reasonably be expected to result in a Material Adverse Effect.

 

35

 

 

Section 5.6      Books and Records. The Borrower will, and will cause each of
its Subsidiaries to, keep proper books of record and account in which full, true
and correct entries shall be made of all dealings and transactions in relation
to its business and activities to the extent necessary to prepare the
consolidated financial statements of Borrower in conformity with GAAP.

 

Section 5.7      Visitation, Inspection, Etc. The Borrower will, and will cause
each of its Subsidiaries to, permit any representative of the Lender, on
reasonable advance written notice, to visit and inspect its properties, to
examine its books and records and to make copies and take extracts therefrom,
and to discuss its affairs, finances and accounts with any of its officers and
with its independent certified public accountants, all at such reasonable times
and as often as the Lender may reasonably request after reasonable prior notice
to the Borrower.

 

Section 5.8      Maintenance of Properties; Insurance. The Borrower will, and
will cause each of its Subsidiaries to, (a) keep and maintain all property
material to the conduct of its business in good working order and condition,
ordinary wear and tear except where the failure to do so, either individually or
it the aggregate, could not reasonably be expected to result in a Material
Adverse Effect and (b) maintain with financially sound and reputable insurance
companies, insurance with respect to its properties and business, and the
properties and business of its Subsidiaries, against loss or damage of the kinds
and at least in the amounts as maintained by the Borrower and the Subsidiaries
on the date of this Agreement; provided that such amounts shall be appropriately
adjusted for inflation and for changes in the nature and volume of the business
conducted by the Borrower and its Subsidiaries; provided further, however, that
for purposes of this Section 5.8, the self-insurance program of the Borrower and
its Subsidiaries with respect to comprehensive and collision damage to its
highway vehicles, comprehensive general and automotive liability and property
damage and as in effect on the date hereof is hereby deemed adequate insurance
against losses.

 

Section 5.9      Use of Proceeds. The Borrower will use the proceeds of the
Loans for working capital, for capital expenditures, to support the issuance of
standby letters of credit, for stock repurchase, to finance acquisitions and for
other general corporate purposes. No part of the proceeds of any Loan will be
used, whether directly or indirectly, for any purpose that would violate any
rule or regulation of the Board of Governors of the Federal Reserve System,
including Regulations T, U or X.

 

Section 5.10    Additional Subsidiaries. If any additional Subsidiary is
acquired or formed after the Closing Date, the Borrower will, within ten (10)
New York Business Days after such Subsidiary is acquired or formed, notify the
Lender thereof. From time to time at Lender’s request, Borrower will cause any
Subsidiary that is not at the time of such request a Guarantor (other than a
Subsidiary that is a Foreign Subsidiary or a SPE Subsidiary) to become a
Subsidiary Loan Party by executing agreements in the form of Annex I to Exhibit
D and Annex I to Exhibit E in form and substance satisfactory to the Lender, and
will cause each such Subsidiary to deliver simultaneously therewith similar
documents applicable to such Subsidiary required under Section 3.1 as reasonably
requested by the Lender.

 

36

 

 

Section 5.11    Deposit Relationship. The Borrower will, and will cause each of
its Subsidiaries to, maintain its primary depository and treasury management
services with the Lender.

 

Article 6

 

FINANCIAL COVENANTS

 

The Borrower covenants and agrees that so long as the Lender has a Revolving
Commitment hereunder or the principal of or interest on or any Loan remains
unpaid or any fee remains unpaid:

 

Section 6.1      Leverage Ratio. The Borrower will have, as of the end of each
fiscal quarter of the Borrower a Leverage Ratio of not greater than 55%.

 

Section 6.2      Fixed Charge Coverage Ratio. The Borrower will have, as of the
end of each fiscal quarter of the Borrower, a Fixed Charge Coverage Ratio of not
less than 2.25:1.0, calculated based on a rolling four quarter basis.

 

For purposes of this Article 6, notwithstanding anything in this Agreement to
the contrary, for purposes of calculating the Leverage Ratio and the Fixed
Charge Coverage Ratio, the Indebtedness of any Person shall include non-recourse
indebtedness of such Person and of any partnership or joint venture in which
such Person is a general partner or a joint venturer.

 

Section 6.3      Tangible Net Worth. The Borrower will, at all times, maintain a
Tangible Net Worth of not less than $25,000,000, with such minimum Tangible Net
Worth to increase as of the end of each fiscal year, commencing December 31,
2014, by an amount equal to thirty three and four-tenths of one percent (33.4%)
of Borrower’s positive net income for the fiscal year then ending. This covenant
shall be tested quarterly. “Tangible Net Worth” shall mean Consolidated Net
Worth, provided that the aggregate amount of any intangible assets, including,
without limitation, merchant contracts, goodwill, franchises, licenses, patents,
trademarks, trade names, copyrights, service marks, and brand names, shall be
subtracted from total assets.

 

Article 7

NEGATIVE COVENANTS

 

The Borrower covenants and agrees that so long as the Lender has a Revolving
Commitment hereunder or the principal of or interest on any Loan remains unpaid
or any fee remains unpaid:

 

Section 7.1      Indebtedness. The Borrower will not, and will not permit any of
its Subsidiaries to, create, incur, assume or suffer to exist any Indebtedness,
except:

 

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(a)      Indebtedness created pursuant to the Loan Documents;

 

(b)      Indebtedness existing on the date hereof and set forth on Schedule 7.1
(including unborrowed portions of any lines of credit shown thereon) and
extensions, renewals and replacements of any such Indebtedness that do not
increase the outstanding principal amount thereof (immediately prior to giving
effect to such extension, renewal or replacement) or shorten the maturity or the
weighted average life thereof;

 

(c)      Capital Lease Obligations of the Borrower and its Subsidiaries which do
not exceed $5,000,000.00 in the aggregate;

 

(d)      Indebtedness of the Borrower or any Subsidiary in a principal amount
which, when combined with Indebtedness permitted by Section 7.1(h) and Section
7.1(i), does not exceed $25,000,000.00 in the aggregate and which is incurred to
finance the acquisition, construction or improvement of any fixed or capital
assets, including Capital Lease Obligations (other than Capital Lease
Obligations described in Section 7.1(c)) and any Indebtedness assumed in
connection with the acquisition of any such assets secured by a Lien on any such
assets prior to the acquisition thereof; provided, that such Indebtedness is
incurred prior to or within 90 days after such acquisition or the completion of
such construction or improvements or extensions, renewals, and replacements of
any such Indebtedness that do not increase the outstanding principal amount
thereof (immediately prior to giving effect to such extension, renewal or
replacement) or shorten the maturity or the weighted average life thereof;

 

(e)      Permitted Subordinated Debt;

 

(f)       Indebtedness in respect of obligations under Hedging Agreements
permitted by Section 7.10;

 

(g)      current Indebtedness incurred in the ordinary course of business, trade
letters of credit and Indebtedness arising in connection with letters of credit
obtained in the ordinary course of business;

 

(h)      other unsecured Indebtedness outstanding at any time which, when added
to Indebtedness permitted by Section 7.1(d) and (i), does not exceed
$25,000,000.00 in the aggregate; and

 

(i)       Indebtedness of the Borrower or any Subsidiary in a principal amount
which, when combined with Indebtedness permitted by Section 7.1(d) and (h), does
not exceed $25,000,000.00 in the aggregate, which is secured by a Lien on any
fixed or capital assets, including Capital Lease Obligations, and which does not
otherwise qualify as Indebtedness permitted under the terms of Section 7.1(d).

 

Section 7.2 Negative Pledge. The Borrower will not, and will not permit any of
its Subsidiaries to, create, incur, assume or suffer to exist any Lien on any of
its assets or property now owned or hereafter acquired except:

 

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(a)      Permitted Encumbrances;

 

(b)      any Liens on any property or assets of the Borrower or any Subsidiary
existing on the Closing Date set forth on Schedule 7.2; provided, that such Lien
shall not apply to any other property or asset of the Borrower or any
Subsidiary;

 

(c)      purchase money Liens upon or in any fixed or capital assets to secure
the purchase price or the cost of construction or improvement of such fixed or
capital assets or to secure Indebtedness incurred solely for the purpose of
financing the acquisition, construction or improvement of such fixed or capital
assets (including Liens securing any Capital Lease Obligations); provided, that
(i) such Lien secures Indebtedness permitted by Section 7.1(d), (ii) such Lien
attaches to such asset concurrently or within 90 days after the acquisition,
improvement or completion of the construction thereof; (iii) such Lien does not
extend to any other asset; and (iv) the Indebtedness secured thereby does not
exceed the cost of acquiring, constructing or improving such fixed or capital
assets;

 

(d)      any Lien (i) existing on any asset of any Person at the time such
Person becomes a Subsidiary of the Borrower, (ii) existing on any asset of any
Person at the time such Person is merged with or into the Borrower or any
Subsidiary of the Borrower or (iii) existing on any asset prior to the
acquisition thereof by the Borrower or any Subsidiary of the Borrower; provided,
that any such Lien was not created in the contemplation of any of the foregoing
and any such Lien secures only those obligations which it secures on the date
that such Person becomes a Subsidiary or the date of such merger or the date of
such acquisition;

 

(e)      Liens securing Indebtedness permitted under Section 7.1;

 

(f)      Liens or pledges of securities of the Borrower or any Subsidiary to
governmental agencies pursuant to the Borrower’s or any Subsidiary’s insurance
program;

 

(g)      Rights reserved or vested in governmental authority which do not
materially impair the use of such property; and

 

(h)      extensions, renewals, or replacements of any Lien referred to in
paragraphs (a) through (g) of this Section; provided, that the principal amount
of the Indebtedness secured thereby is not increased and that any such
extension, renewal or replacement is limited to the assets originally encumbered
thereby.

 

Section 7.3 Fundamental Changes.

 

(a)      Except as permitted by Section 7.6, the Borrower will not, and will not
permit any Subsidiary to, merge into or consolidate into any other Person, or
permit any other Person to merge into or consolidate with it, or sell, lease,
transfer or otherwise dispose of (in a single transaction or a series of
transactions) all or substantially all of its assets (in each case, whether now
owned or hereafter acquired) or all or substantially all of the stock of any of
its Subsidiaries (in each case, whether now owned or hereafter acquired) or
liquidate or dissolve; provided, that if at the time thereof and immediately
after giving effect thereto, no Default or Event of Default shall have occurred
and be continuing (i) the Borrower or any Subsidiary may merge with a Person if
the Borrower (or such Subsidiary if the Borrower is not a party to such merger)
is the surviving Person, (ii) any Subsidiary may merge into another Subsidiary;
provided, that if any party to such merger is a Subsidiary Loan Party, the
Subsidiary Loan Party shall be the surviving Person, (iii) any Subsidiary may
sell, transfer, lease or otherwise dispose of all or substantially all of its
assets to the Borrower or to a Subsidiary Loan Party, and (iv) any Subsidiary
(other than a Subsidiary Loan Party) may liquidate or dissolve if the Borrower
determines in good faith that such liquidation or dissolution is in the best
interests of the Borrower and is not materially disadvantageous to the Lender;
provided, that any such merger involving a Person that is not a wholly-owned
Subsidiary immediately prior to such merger shall not be permitted unless also
permitted by Section 7.4. Notwithstanding the foregoing, the Borrower and the
Guarantors shall be permitted to transfer real properties to SPE Subsidiaries
for the purpose of permanent financing of such properties.

 

39

 

 

(b)      The Borrower will not, and will not permit any of its Subsidiaries to,
engage to any material extent in any business other than businesses of
substantially the same type conducted by the Borrower and its Subsidiaries on
the date hereof and businesses reasonably related thereto.

 

Section 7.4 Investments, Loans, Etc. The Borrower will not, and will not permit
any of its Subsidiaries to, purchase, hold or acquire (including pursuant to any
merger with any Person that was not a wholly-owned Subsidiary prior to such
merger), any common stock, evidence of indebtedness or other securities
(including any option, warrant, or other right to acquire any of the foregoing)
of, make or permit to exist any loans or advances to, Guarantee any obligations
of, or make or permit to exist any investment or any other interest in, any
other Person (all of the foregoing being collectively called “Investments”), or
purchase or otherwise acquire (in one transaction or a series of transactions)
any assets of any other Person (“Acquisitions”), except:

 

(a)      Investments (other than Permitted Investments) existing on the date
hereof and set forth on Schedule 7.4;

 

(b)      Permitted Investments;

 

(c)      Guarantees constituting Indebtedness permitted by Section 7.1;
provided, that the aggregate principal amount of Indebtedness of Subsidiaries
that are not Subsidiary Loan Parties that is Guaranteed by any Loan Party shall
be subject to the limitation set forth in clause (d) hereof;

 

(d)      Investments made by the Borrower in or to any Subsidiary and by any
Subsidiary to the Borrower or in or to another Subsidiary;

 

(e)      loans or advances to employees, officers or directors of the Borrower
or any Subsidiary in the ordinary course of business for travel, relocation and
related expenses;

 

(f)       Hedging Agreements permitted by Section 7.10;

 

40

 

 

(g)      Joint ventures that are typical in the Borrower’s ordinary course of
business;

 

(h)      Other Investments which in the aggregate do not exceed $5,000,000.00 in
any fiscal year of the Borrower; and

 

(i)      Acquisitions not to exceed in the aggregate in any fiscal year of the
Borrower 20% of Consolidated Net Worth (measured at the end of the immediately
preceding fiscal year); provided that Acquisitions in the aggregate in any
fiscal year of the Borrower in excess of 20% of Consolidated Net Worth (measured
at the end of the immediately preceding fiscal year) may be made after delivery
to the Lender of pro forma consolidated financial statements, certified by the
Borrower and reasonably acceptable to the Lender, showing that after giving
effect to such Acquisitions (i) Borrower shall remain in compliance with the
financial covenants set forth in Article 6 hereof on a pro forma basis, and (ii)
no Default or Event of Default would exist.

 

Section 7.5      Restricted Payments. After the date of this Agreement, the
Borrower will not, and will not permit its Subsidiaries to, declare or make, or
agree to pay or make, directly or indirectly, any dividend on any class of its
stock, or make any payment on account of, or set apart assets for a sinking or
other analogous fund for, the purchase, redemption, retirement, defeasance or
other acquisition of, any Indebtedness subordinated to the Obligations of the
Borrower or any options, warrants, or other rights to purchase such
Indebtedness, whether now or hereafter outstanding (each, a “Restricted
Payment”), except for (i) dividends not exceeding 66.6% of Consolidated Net
Income allocable to Borrower and its Subsidiaries subsequent to September 30,
2003, (ii) dividends payable by the Borrower solely in shares of any class of
its common stock, (iii) Restricted Payments made by any Subsidiary to the
Borrower or to another Subsidiary Loan Party and (iv) cash redemptions of the
common stock of the Borrower; provided, that the exceptions permitted pursuant
to clauses (i) through (iv) shall apply only if no Default or Event of Default
has occurred and is continuing at the time such dividend or other payment is
paid or redemption is made.

 

Section 7.6      Sale of Assets. The Borrower will not, and will not permit any
of its Subsidiaries to, convey, sell, lease, assign, transfer or otherwise
dispose of, any of its assets, business or property, whether now owned or
hereafter acquired, or, in the case of any Subsidiary, issue or sell any shares
of such Subsidiary’s common stock to, any Person other than the Borrower or any
wholly-owned Subsidiary of the Borrower (or to qualify directors if required by
applicable law), except:

 

(a)      the sale or other disposition for fair market value of obsolete or worn
out property or other property not necessary for operations disposed of in the
ordinary course of business;

 

(b)      the sale of assets and Permitted Investments in the ordinary course of
the transportation business of the Borrower and its Subsidiaries; and

 

41

 

 

(c)      without the prior written consent of the Lender, the sale or other
disposition of such other assets in an aggregate amount not to exceed
$5,000,000.00 during the term of this Agreement; provided, however, that such
amount shall not include (i) intercompany mergers of Subsidiaries, (ii) sales,
leases or transfers of assets of any Subsidiary to the Borrower or any other
Subsidiary, and (iii) mergers or consolidations with the Borrower or any
Subsidiary so long as the Borrower or such Subsidiary shall be the surviving
corporation and no Default or Event of Default shall then exist.

 

Section 7.7      Transactions with Affiliates. The Borrower will not, and will
not permit any of its Subsidiaries to, sell, lease or otherwise transfer any
property or assets to, or purchase, lease or otherwise acquire any property or
assets from, or otherwise engage in any other transactions with, any of its
Affiliates, except (a) in the ordinary course of business at prices and on terms
and conditions not less favorable to the Borrower or such Subsidiary than could
be obtained on an arm’s-length basis from unrelated third parties including,
without limitation, those affiliate transactions disclosed in the Borrower’s
Form 10-K as on file with the Securities and Exchange Commission on the date
hereof, (b) transactions between or among the Borrower and the Guarantors not
involving any other Affiliates and (c) any Restricted Payment permitted by
Section 7.5.

 

Section 7.8      Restrictive Agreements. The Borrower will not, and will not
permit any Subsidiary to, directly or indirectly, enter into, incur or permit to
exist any agreement that prohibits, restricts or imposes any condition upon (a)
the ability of the Borrower or any Subsidiary to create, incur or permit any
Lien upon any of its assets or properties, whether now owned or hereafter
acquired, or (b) the ability of any Subsidiary to pay dividends or other
distributions with respect to its common stock, to make or repay loans or
advances to the Borrower or any other Subsidiary, to Guarantee Indebtedness of
the Borrower or any other Subsidiary or to transfer any of its property or
assets to the Borrower or any Subsidiary of the Borrower; provided, that (i) the
foregoing shall not apply to restrictions or conditions imposed by law or by
this Agreement or any other Loan Document, (ii) the foregoing shall not apply to
customary restrictions and conditions contained in agreements relating to the
sale of a Subsidiary pending such sale, provided such restrictions and
conditions apply only to the Subsidiary that is sold and such sale is permitted
hereunder, (iii) clause (a) shall not apply to restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by this
Agreement if such restrictions and conditions apply only to the property or
assets securing such Indebtedness and (iv) clause (a) shall not apply to
customary provisions in leases and other contracts restricting the assignment
thereof.

 

Section 7.9      Sale and Leaseback Transactions. The Borrower will not, and
will not permit any of the Subsidiaries to, enter into any arrangement, directly
or indirectly, whereby it shall sell or transfer any property, real or personal,
used or useful in its business, whether now owned or hereinafter acquired, and
thereafter rent or lease such property or other property that it intends to use
for substantially the same purpose or purposes as the property sold or
transferred.

 

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Section 7.10    Hedging Agreements. The Borrower will not, and will not permit
any of the Subsidiaries to, enter into any Hedging Agreement, other than Hedging
Agreements entered into in the ordinary course of business to hedge or mitigate
risks to which the Borrower or any Subsidiary is exposed in the conduct of its
business or the management of its liabilities. Solely for the avoidance of
doubt, the Borrower acknowledges that a Hedging Agreement entered into for
speculative purposes or of a speculative nature (which shall be deemed to
include any Hedging Agreement under which the Borrower or any of the
Subsidiaries is or may become obliged to make any payment (i) in connection with
the purchase by any third party of any common stock or any Indebtedness or (ii)
as a result of changes in the market value of any common stock or any
Indebtedness) is not a Hedging Agreement entered into in the ordinary course of
business to hedge or mitigate risks.

 

Section 7.11    Amendment to Material Documents. The Borrower will not, and will
not permit any Subsidiary to, amend, modify or waive any of its rights in a
manner materially adverse to the Lender under its certificate of incorporation,
bylaws or other organizational documents.

 

Section 7.12 Permitted Subordinated Indebtedness

 

(a)      The Borrower will not (i) prepay, redeem, repurchase or otherwise
acquire for value any Permitted Subordinated Debt, or (ii) make any principal,
interest or other payments on any Permitted Subordinated Debt that is not
expressly permitted by the subordination provisions of the Subordinated Debt
Documents.

 

(b)      The Borrower will not agree to or permit any amendment, modification or
waiver of any provision of any Subordinated Debt Document if the effect of such
amendment, modification or waiver is to (i) increase the interest rate on such
Permitted Subordinated Debt for change (to earlier dates) the dates upon which
principal and interest are due thereon; (ii) alter the redemption, prepayment or
subordination provisions thereof; (iii) alter the covenants and events of
default in a manner that would make such provisions more onerous or restrictive
to the Borrower; or (iv) otherwise increase the obligations of the Borrower in
respect of such Permitted Subordinated Debt or confer additional rights upon the
holders thereof which individually or in the aggregate would be adverse to the
Borrower or to the Lender.

 

Section 7.13    Accounting Changes. The Borrower will not, and will not permit
any Subsidiary to, make any significant change in accounting treatment or
reporting practices, except as required or preferred by GAAP, or change the
fiscal year of the Borrower or of any Subsidiary, except to change the fiscal
year of a Subsidiary to conform its fiscal year to that of the Borrower.

 

Section 7.14    Name Changes. The Borrower will not, and will not permit any
Guarantor to, without thirty (30) days prior written notice, change its name,
its place of business or, if more than one, chief executive office, or its
mailing address or organizational identification number if it has one.

 

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Article 8

EVENTS OF DEFAULT

 

Section 8.1      Events of Default. If any of the following events (each an
“Event of Default”) shall occur:

 

(a)      the Borrower shall fail to pay any principal of any Loan when and as
the same shall become due and payable, whether at the due date thereof or at a
date fixed for prepayment or otherwise; or

 

(b)      the Borrower shall fail to pay any interest on any Loan or any fee or
any other amount (other than an amount payable under clause (a) of this Article)
payable under this Agreement or any other Loan Document, when and as the same
shall become due and payable, and such failure shall continue unremedied for a
period of ten (10) days; or

 

(c)      any representation or warranty made or deemed made by or on behalf of
the Borrower or any Subsidiary in or in connection with this Agreement or any
other Loan Document (including the Schedules attached thereto) and any
amendments or modifications hereof or waivers hereunder, or in any certificate,
report, financial statement or other document submitted to the Lender by any
Loan Party or any representative of any Loan Party pursuant to or in connection
with this Agreement or any other Loan Document shall prove to be false or
misleading when made or deemed made or submitted; or

 

(d)      the Borrower shall fail to observe or perform any covenant or agreement
contained in Sections 5.1 or 5.10 or Articles 6 or 7 (other than in Section
7.14) and such failure shall continue unremedied for a period of thirty (30)
days; or

 

(e)      any Loan Party shall fail to observe or perform any covenant or
agreement contained in Section 5.9; or

 

(f)      any Loan Party shall fail to observe or perform any covenant or
agreement contained in this Agreement or any other Loan Document (other than
those referred to in clauses (a), (b), (d) and (e) above), and such failure
shall remain unremedied for 30 days after the earlier of (i) any officer of the
Borrower becomes aware of such failure, or (ii) written notice thereof shall
have been given to the Borrower by the Lender; or

 

(g)      the Borrower, any Subsidiary Loan Party or any other Subsidiary subject
to any Material Indebtedness other than non-recourse Indebtedness (a “Recourse
Subsidiary”) (whether as primary obligor or as guarantor or other surety) shall
fail to pay any principal of or premium or interest on such Material
Indebtedness that is outstanding, when and as the same shall become due and
payable (whether at scheduled maturity, required prepayment, acceleration,
demand or otherwise), and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument evidencing such
Material Indebtedness; or any other event shall occur or condition shall exist
under any agreement or instrument relating to such Material Indebtedness and
shall continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such event or condition is to
accelerate, or permit the acceleration of, the maturity of such Material
Indebtedness; or any such Material Indebtedness shall be declared to be due and
payable; or required to be prepaid or redeemed (other than by a regularly
scheduled required prepayment or redemption), purchased or defeased, or any
offer to prepay, redeem, purchase or defease such Material Indebtedness shall be
required to be made, in each case prior to the stated maturity thereof; or

 

44

 

 

(h)      the Borrower, any Subsidiary Loan Party or any Recourse Subsidiary
shall (i) commence a voluntary case or other proceeding or file any petition
seeking liquidation, reorganization or other relief under any federal, state or
foreign bankruptcy, insolvency or other similar law now or hereafter in effect
or seeking the appointment of a custodian, trustee, receiver, liquidator or
other similar official of it or any substantial part of its property, (ii)
consent to the institution of, or fail to contest in a timely and appropriate
manner, any proceeding or petition described in clause (i) of this Section,
(iii) apply for or consent to the appointment of a custodian, trustee, receiver,
liquidator or other similar official for the Borrower, any such Subsidiary Loan
Party or any Recourse Subsidiary or for a substantial part of its assets, (iv)
file an answer admitting the material allegations of a petition filed against it
in any such proceeding, (v) make a general assignment for the benefit of
creditors, or (vi) take any action for the purpose of effecting any of the
foregoing; or

 

(i)      an involuntary proceeding shall be commenced or an involuntary petition
shall be filed seeking (i) liquidation, reorganization or other relief in
respect of the Borrower, any Subsidiary Loan Party or any Recourse Subsidiary or
its debts, or any substantial part of its assets, under any federal, state or
foreign bankruptcy, insolvency or other similar law now or hereafter in effect
or (ii) the appointment of a custodian, trustee, receiver, liquidator or other
similar official for the Borrower, any Subsidiary Loan Party or any Recourse
Subsidiary or for a substantial part of its assets, and in any such case, such
proceeding or petition shall remain undismissed for a period of 60 days or an
order or decree approving or ordering any of the foregoing shall be entered; or

 

(j)      the Borrower, any Subsidiary Loan Party or any Recourse Subsidiary
shall become unable to pay, shall admit in writing its inability to pay, or
shall fail to pay, its debts as they become due; or

 

(k)     an ERISA Event shall have occurred that, in the opinion of the Lender,
when taken together with other ERISA Events that have occurred, could reasonably
be expected to result in a Material Adverse Effect; or

 

(l)      any judgment or order for the payment of money in excess of
$1,000,000.00 (after application of net insurance proceeds, if any) in the
aggregate or that could reasonably be expected to have a Material Adverse Effect
shall be rendered against the Borrower, any Subsidiary Loan Party or any
Recourse Subsidiary, and either (i) enforcement proceedings shall have been
commenced by any creditor upon such judgment or order or (ii) there shall be a
period of 60 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect; or

 

45

 

 

(m)    any non-monetary judgment or order shall be rendered against the
Borrower, any Subsidiary Loan Party or any Recourse Subsidiary that could
reasonably be expected to have a Material Adverse Effect, and there shall be a
period of 60 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect; or

 

(n)     a Change in Control shall occur or exist; or

 

(o)     any provision of any Subsidiary Guarantee Agreement shall for any reason
cease to be valid and binding on, or enforceable against, any Subsidiary Loan
Party, or any Subsidiary Loan Party shall so state in writing, or any Subsidiary
Loan Party shall seek to terminate its Subsidiary Guarantee Agreement;

 

then, and in every such event (other than an event with respect to the Borrower
described in clause (h) or (i) of this Section) and at any time thereafter
during the continuance of such event, the Lender may, by notice to the Borrower,
take any or all of the following actions, at the same or different times: (i)
terminate the Revolving Commitment; (ii) declare the principal of and any
accrued interest on the Loans, and all other Obligations owing hereunder, to be,
whereupon the same shall become due and payable immediately, without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower; (iii) exercise all remedies contained in any
other Loan Document; and (iv) demand payment of an amount equal to 100% of the
aggregate Available Amount under all outstanding Letters of Credit, to be held
by the Lender as collateral for the Borrower’s reimbursement obligations; and
that, if an Event of Default specified in either clause (h) or (i) shall occur,
the Revolving Commitment shall automatically terminate and the principal of the
Loans then outstanding, together with accrued interest thereon, an amount equal
to the aggregate Available Amount under all outstanding Letters of Credit, and
all fees, and all other Obligations shall automatically become due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Borrower.

 

Article 9

RESERVED

 

Article 10

MISCELLANEOUS

 

Section 10.1   Notices.

 

(a)      Except in the case of notices and other communications expressly
permitted to be given by telephone, all notices and other communications to any
party herein to be effective shall be in writing and shall be delivered by hand
or overnight courier service, mailed by certified or registered mail or sent by
telecopy, as follows:

 

46

 

 

To the Borrower:   Patriot Transportation Holding, Inc.     200 W. Forsyth
Street, 7th Floor     Jacksonville, Florida 32202     Attention: John D. Milton,
Jr.,       To the Lender:   Wells Fargo Bank, N.A.     One Independent Drive,
25th Floor     Jacksonville, Florida 32202     Attention: Kevin S. Hawkins    
Telephone No: (904) 351-7303       With a copy to:   Charles V. Hedrick, Esq.  
  Foley & Lardner LLP     One Independent Drive, Suite 1300     Jacksonville,
Florida 32202-5017

  

Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All such notices
and other communications shall, when transmitted by overnight delivery, or
faxed, be effective when delivered for overnight (next-day) delivery, or if
mailed, upon the third New York Business Day after the date deposited into the
mails or if delivered, upon delivery; provided, that notices delivered to the
Lender shall not be effective until actually received by such Person at its
address specified in this Section 10.1.

 

(b)      Any agreement of the Lender herein to receive certain notices by
telephone is solely for the convenience and at the request of the Borrower. The
Lender shall be entitled to rely on the authority of any Person purporting to be
a Person authorized by the Borrower to give such notice and the Lender shall not
have any liability to the Borrower or other Person on account of any action
taken or not taken by the Lender in reliance upon such telephonic notice. The
obligation of the Borrower to repay the Loans and all other Obligations
hereunder shall not be affected in any way or to any extent by any failure of
the Lender to receive written confirmation of any telephonic notice or the
receipt by the Lender of a confirmation which is at variance with the terms
understood by the Lender to be contained in any such telephonic notice.

 

Section 10.2   Waiver; Amendments.

 

(a)      No failure or delay by the Lender in exercising any right or power
hereunder or any other Loan Document, and no course of dealing between the
Borrower and the Lender, shall operate as a waiver thereof, nor shall any single
or partial exercise of any such right or power or any abandonment or
discontinuance of steps to enforce such right or power, preclude any other or
further exercise thereof or the exercise of any other right or power hereunder
or thereunder. The rights and remedies of the Lender hereunder and under the
other Loan Documents are cumulative and are not exclusive of any rights or
remedies provided by law. No waiver of any provision of this Agreement or any
other Loan Document or consent to any departure by the Borrower therefrom shall
in any event be effective unless the same shall be permitted by paragraph (b) of
this Section, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. Without limiting the
generality of the foregoing, the making of a Loan shall not be construed as a
waiver of any Default or Event of Default, regardless of whether the Lender may
have had notice or knowledge of such Default or Event of Default at the time.

 

47

 

 

(b)      No amendment or waiver of any provision of this Agreement or the other
Loan Documents, nor consent to any departure by the Borrower therefrom, shall in
any event be effective unless the same shall be in writing and signed by the
Borrower and the Lender and then such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given.

 

Section 10.3   Expenses; Indemnification.

 

(a)      The Borrower shall pay (i) all reasonable, out-of-pocket costs and
expenses of the Lender and its Affiliates, including the reasonable fees,
charges and disbursements of counsel for the Lender and its Affiliates, in
connection with the syndication of the credit facilities provided for herein,
the preparation and administration of the Loan Documents and any amendments,
modifications or waivers thereof (whether or not the transactions contemplated
in this Agreement or any other Loan Document shall be consummated) and (ii) all
reasonable out-of-pocket costs and expenses (including, without limitation, the
reasonable fees, charges and disbursements of outside counsel and the allocated
cost of inside counsel) incurred by the Lender in connection with the
enforcement or protection of its rights in connection with this Agreement,
including its rights under this Section, or in connection with the Loans made,
including all such out-of-pocket expenses incurred during any workout,
restructuring or negotiations in respect of such Loans.

 

(b)      The Borrower shall indemnify the Lender, and each Related Party of the
Lender (each, an “Indemnitee”) against, and hold each of them harmless from, any
and all costs, losses, liabilities, claims, damages and related expenses,
including the reasonable fees, charges and disbursements of any counsel for any
Indemnitee, which may be incurred by or asserted against any Indemnitee arising
out of, in connection with or as a result of (i) the execution or delivery of
this Agreement or any other agreement or instrument contemplated hereby, the
performance by the parties hereto of their respective obligations hereunder or
the consummation of any of the transactions contemplated hereby, (ii) any Loan
or any actual or proposed use of the proceeds therefrom, (iii) any actual or
alleged presence or release of Hazardous Materials on or from any property owned
by the Borrower or any Subsidiary or any Environmental Liability related in any
way to the Borrower or any Subsidiary or (iv) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether based on contract, tort or any other theory and regardless of whether
any Indemnitee is a party thereto; provided, that the Borrower shall not be
obligated to indemnify any Indemnitee for any of the foregoing arising out of
such Indemnitee’s gross negligence or willful misconduct as determined by a
court of competent jurisdiction in a final and nonappealable judgment.

 

48

 

  

(c)     The Borrower shall pay, and hold the Lender harmless from and against,
any and all present and future stamp, documentary, and other similar taxes with
respect to this Agreement and any other Loan Documents, any collateral described
therein, or any payments due thereunder, and save the Lender harmless from and
against any and all liabilities with respect to or resulting from any delay or
omission to pay such taxes.

 

(d)     To the extent permitted by applicable law, the Borrower shall not
assert, and hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to actual or direct damages) arising out of, in connection with or as a result
of, this Agreement or any agreement or instrument contemplated hereby, the
transactions contemplated therein, any Loan or the use of proceeds thereof.

 

(e)     All amounts due under this Section shall be payable promptly after
written demand therefor.

 

Section 10.4   Successors and Assigns.

 

(a)      The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns,
except that the Borrower may not assign or transfer any of its rights hereunder
without the prior written consent of Lender (and any attempted assignment or
transfer by the Borrower without such consent shall be null and void).

 

(b)      The Lender may at any time, without the consent of the Borrower, sell
participations to one or more banks or other entities (a “Participant”) in all
or a portion of the Lender’s rights and obligations under this Agreement
(including all or a portion of the Revolving Commitment and the Loans owing to
it); provided, that (i) the Lender’s obligations under this Agreement shall
remain unchanged, (ii) the Lender shall remain solely responsible to the other
parties hereto for the performance of its obligations hereunder, and (iii) the
Borrower shall continue to deal solely and directly with the Lender in
connection with the Lender’s rights and obligations under this Agreement and the
other Loan Documents. Any agreement between the Lender and the Participant with
respect to such participation shall provide that the Lender shall retain the
sole right and responsibility to enforce this Agreement and the other Loan
Documents and the right to approve any amendment, modification or waiver of this
Agreement and the other Loan Documents; provided, that such participation
agreement may provide that the Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver of this Agreement
that would (i) increase the Revolving Commitment of the Participant without the
written consent of such Participant, (ii) reduce the principal amount of any
Loan or reduce the rate of interest thereon, or reduce any fees payable
hereunder, without the written consent of each Participant affected thereby,
(iii) postpone the date fixed for any payment of any principal of, or interest
on, any Loan or interest thereon or any fees hereunder or reduce the amount of,
waive or excuse any such payment, or postpone the scheduled date for the
termination or reduction of the Revolving Commitment, without the written
consent of each Participant affected thereby, (iv) release any guarantor or
limit the liability of any such guarantor under any guaranty agreement without
the written consent of such Participant; or (v) release all or substantially all
collateral (if any) securing any of the Obligations without the written consent
of such Participant. The Borrower agrees that each Participant shall be entitled
to the benefits of Sections 2.16, 2.17, and 2.18 to the same extent as if it
were a Lender hereunder and had acquired its interest by assignment pursuant to
paragraph (b); provided, that no Participant shall be entitled to receive any
greater payment under Section 2.16 or 2.18 than the Lender would have been
entitled to receive with respect to the participation sold to such Participant
unless the sale of such participation is made with the Borrower’s prior written
consent. To the extent permitted by law, the Borrower agrees that each
Participant shall be entitled to the benefits of Section 2.20 as though it were
the Lender, provided, that such Participant agrees to share with the Lender the
proceeds thereof in accordance with Section 2.20 as fully as if it were the
Lender hereunder.

 

49

 

  

(c)       The Lender may at any time pledge or assign a security interest in all
or any portion of its rights under this Agreement and the Revolving Credit Note
to secure its obligations to a Federal Reserve Bank without complying with this
Section; provided, that no such pledge or assignment shall release the Lender
from any of its obligations hereunder or substitute any such pledgee or assignee
for the Lender as a party hereto.

 

Section 10.5   Governing Law; Jurisdiction; Consent to Service of Process.

 

(a)       This Agreement and the other Loan Documents shall be construed in
accordance with and be governed by the law (without giving effect to the
conflict of law principles thereof) of the State of Florida.

 

(b)       The Borrower hereby irrevocably and unconditionally submits, for
itself and its property, to the non-exclusive jurisdiction of the Circuit Court
of Duval County, Florida, the United States District Court of the Middle
District of Florida, and of any state court of the State of Florida and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or any other Loan Document or the transactions
contemplated hereby or thereby, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such Florida state court or, to the extent permitted by
applicable law, such Federal court. Each of the parties hereto agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement or any other Loan Document shall
affect any right that the Lender may otherwise have to bring any action or
proceeding relating to this Agreement or any other Loan Document against the
Borrower or its properties in the courts of any jurisdiction.

 

(c)       The Borrower irrevocably and unconditionally waives any objection
which it may now or hereafter have to the laying of venue of any such suit,
action or proceeding described in paragraph (b) of this Section and brought in
any court referred to in paragraph (b) of this Section. Each of the parties
hereto irrevocably waives, to the fullest extent permitted by applicable law,
the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.

 

50

 

 

Section 10.6   Arbitration.

 

(a)       Arbitration. The parties hereto agree, upon demand by any party, to
submit to binding arbitration all claims, disputes and controversies between or
among them (and their respective employees, officers, directors, attorneys, and
other agents), whether in tort, contract or otherwise in any way arising out of
or relating to (i) any credit subject hereto, or any of the Loan Documents, and
their negotiation, execution, collateralization, administration, repayment,
modification, extension, substitution, formation, inducement, enforcement,
default or termination; or (ii) requests for additional credit. In the event of
a court ordered arbitration, the party requesting arbitration shall be
responsible for timely filing the demand for arbitration and paying the
appropriate filing fee within 30 days of the abatement order or the time
specified by the court. Failure to timely file the demand for arbitration as
ordered by the court will result in that party’s right to demand arbitration
being automatically terminated.

 

(b)      Governing Rules. Any arbitration proceeding will (i) proceed in a
location in Florida selected by the American Arbitration Association (“AAA”);
(ii) be governed by the Federal Arbitration Act (Title 9 of the United States
Code), notwithstanding any conflicting choice of law provision in any of the
documents between the parties; and (iii) be conducted by the AAA, or such other
administrator as the parties shall mutually agree upon, in accordance with the
AAA’s commercial dispute resolution procedures, unless the claim or counterclaim
is at least $1,000,000.00 exclusive of claimed interest, arbitration fees and
costs in which case the arbitration shall be conducted in accordance with the
AAA’s optional procedures for large, complex commercial disputes (the commercial
dispute resolution procedures or the optional procedures for large, complex
commercial disputes to be referred to herein, as applicable, as the “Rules”). If
there is any inconsistency between the terms hereof and the Rules, the terms and
procedures set forth herein shall control. Any party who fails or refuses to
submit to arbitration following a demand by any other party shall bear all costs
and expenses incurred by such other party in compelling arbitration of any
dispute. Nothing contained herein shall be deemed to be a waiver by any party
that is a bank of the protections afforded to it under 12 U.S.C. §91 or any
similar applicable state law.

 

(c)       No Waiver of Provisional Remedies, Self-Help and Foreclosure. The
arbitration requirement does not limit the right of any party to (i) foreclose
against real or personal property collateral; (ii) exercise self-help remedies
relating to collateral or proceeds of collateral such as setoff or repossession;
or (iii) obtain provisional or ancillary remedies such as replevin, injunctive
relief, attachment or the appointment of a receiver, before during or after the
pendency of any arbitration proceeding. This exclusion does not constitute a
waiver of the right or obligation of any party to submit any dispute to
arbitration or reference hereunder, including those arising from the exercise of
the actions detailed in sections (i), (ii) and (iii) of this paragraph.

 

51

 

 

(d)      Arbitrator Qualifications and Powers. Any arbitration proceeding in
which the amount in controversy is $5,000,000.00 or less will be decided by a
single arbitrator selected according to the Rules, and who shall not render an
award of greater than $5,000,000.00. Any dispute in which the amount in
controversy exceeds $5,000,000.00 shall be decided by majority vote of a panel
of three arbitrators; provided however, that all three arbitrators must actively
participate in all hearings and deliberations. The arbitrator will be a neutral
attorney licensed in the State of Florida or a neutral retired judge of the
state or federal judiciary of Florida, in either case with a minimum of ten
years’ experience in the substantive law applicable to the subject matter of the
dispute to be arbitrated. The arbitrator will determine whether or not an issue
is arbitratable and will give effect to the statutes of limitation in
determining any claim. In any arbitration proceeding the arbitrator will decide
(by documents only or with a hearing at the arbitrator’s discretion) any
pre-hearing motions which are similar to motions to dismiss for failure to state
a claim or motions for summary adjudication. The arbitrator shall resolve all
disputes in accordance with the substantive law of Florida and may grant any
remedy or relief that a court of such state could order or grant within the
scope hereof and such ancillary relief as is necessary to make effective any
award. The arbitrator shall also have the power to award recovery of all costs
and fees, to impose sanctions and to take such other action as the arbitrator
deems necessary to the same extent a judge could pursuant to the Federal Rules
of Civil Procedure, the Florida Rules of Civil Procedure or other applicable
law. Judgment upon the award rendered by the arbitrator may be entered in any
court having jurisdiction. The institution and maintenance of an action for
judicial relief or pursuit of a provisional or ancillary remedy shall not
constitute a waiver of the right of any party, including the plaintiff, to
submit the controversy or claim to arbitration if any other party contests such
action for judicial relief.

 

(e)      Discovery. In any arbitration proceeding, discovery will be permitted
in accordance with the Rules. All discovery shall be expressly limited to
matters directly relevant to the dispute being arbitrated and must be completed
no later than 20 days before the hearing date. Any requests for an extension of
the discovery periods, or any discovery disputes, will be subject to final
determination by the arbitrator upon a showing that the request for discovery is
essential for the party’s presentation and that no alternative means for
obtaining information is available.

 

(f)       Class Proceedings and Consolidations. No party hereto shall be
entitled to join or consolidate disputes by or against others in any
arbitration, except parties who have executed any Loan Document, or to include
in any arbitration any dispute as a representative or member of a class, or to
act in any arbitration in the interest of the general public or in a private
attorney general capacity.

 

(g)      Payment Of Arbitration Costs And Fees. The arbitrator shall award all
costs and expenses of the arbitration proceeding.

 

(h)      Miscellaneous. To the maximum extent practicable, the AAA, the
arbitrators and the parties shall take all action required to conclude any
arbitration proceeding within 180 days of the filing of the dispute with the
AAA. No arbitrator or other party to an arbitration proceeding may disclose the
existence, content or results thereof, except for disclosures of information by
a party required in the ordinary course of its business or by applicable law or
regulation. If more than one agreement for arbitration by or between the parties
potentially applies to a dispute, the arbitration provision most directly
related to the Loan Documents or the subject matter of the dispute shall
control. This arbitration provision shall survive termination, amendment or
expiration of any of the Loan Documents or any relationship between the parties.

 

52

 

 

(i)       Small Claims Court. Notwithstanding anything herein to the contrary,
each party retains the right to pursue in Small Claims Court any dispute within
that court’s jurisdiction. Further, this arbitration provision shall apply only
to disputes in which either party seeks to recover an amount of money (excluding
attorneys’ fees and costs) that exceeds the jurisdictional limit of the Small
Claims Court.

 

Section 10.7   Right of Setoff.  In addition to any rights now or hereafter
granted under applicable law and not by way of limitation of any such rights,
the Lender shall have the right, at any time or from time to time upon the
occurrence and during the continuance of an Event of Default, without prior
notice to the Borrower, any such notice being expressly waived by the Borrower
to the extent permitted by applicable law, to set off and apply against all
deposits (general or special, time or demand, provisional or final) of the
Borrower at any time held or other obligations at any time owing by the Lender
to or for the credit or the account of the Borrower against any and all
Obligations held by the Lender, irrespective of whether the Lender shall have
made demand hereunder and although such Obligations may be unmatured. the Lender
agrees promptly to notify the Borrower after any such set off and any
application made by the Lender; provided, that the failure to give such notice
shall not affect the validity of such set-off and application.

 

Section 10.8   Counterparts; Integration.  This Agreement may be executed by one
or more of the parties to this Agreement on any number of separate counterparts
(including by telecopy), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. This Agreement, the other Loan
Documents, and any separate letter agreement(s) relating to any fees payable to
the Lender constitute the entire agreement among the parties hereto and thereto
regarding the subject matters hereof and thereof and supersede all prior
agreements and understandings, oral or written, regarding such subject matters.

 

Section 10.9   Survival.  All covenants, agreements, representations and
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any
Loans, regardless of any investigation made by any such other party or on its
behalf and notwithstanding that the Lender may have had notice or knowledge of
any Default or incorrect representation or warranty at the time any credit is
extended hereunder, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Loan or any fee or any other amount
payable under this Agreement is outstanding and unpaid and so long as the
Revolving Commitment has not expired or terminated. The provisions of Sections
2.17, 2.18, 2.19 and 10.3 shall survive and remain in full force and effect
regardless of the consummation of the transactions contemplated hereby, the
repayment of the Loans, the expiration or termination of the Revolving
Commitment or the termination of this Agreement or any provision hereof. All
representations and warranties made herein, in the certificates, reports,
notices, and other documents delivered pursuant to this Agreement shall survive
the execution and delivery of this Agreement and the other Loan Documents, and
the making of the Loans.

 

53

 

 

Section 10.10 Severability.  Any provision of this Agreement or any other Loan
Document held to be illegal, invalid or unenforceable in any jurisdiction,
shall, as to such jurisdiction, be ineffective to the extent of such illegality,
invalidity or unenforceability without affecting the legality, validity or
enforceability of the remaining provisions hereof or thereof; and the
illegality, invalidity or unenforceability of a particular provision in a
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.

 

Section 10.11 Confidentiality. The Lender agrees to take normal and reasonable
precautions to maintain the confidentiality of any information designated in
writing as confidential and provided to it by the Borrower or any Subsidiary,
except that such information may be disclosed (i) to any Related Party of the
Lender, including without limitation accountants, legal counsel and other
advisors, (ii) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process, (iii) to the extent requested by any
regulatory agency or authority, (iv) to the extent that such information becomes
publicly available other than as a result of a breach of this Section, or which
becomes available to the Lender or any Related Party of any of the foregoing on
a nonconfidential basis from a source other than the Borrower, (v) in connection
with the exercise of any remedy hereunder or any suit, action or proceeding
relating to this Agreement or the enforcement of rights hereunder, and subject
to provisions substantially similar to this Section 10.11, to any actual or
prospective assignee or Participant, or (vi) with the consent of the Borrower.
Any Person required to maintain the confidentiality of any information as
provided for in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such information as such Person would accord its
own confidential information.

 

Section 10.12 Interest Rate Limitation.  Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together with
all fees, charges and other amounts which may be treated as interest on such
Loan under applicable law (collectively, the “Charges”), shall exceed the
maximum lawful rate of interest (the “Maximum Rate”) which may be contracted
for, charged, taken, received or reserved by the Lender in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to the Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Rate to the date of repayment, shall
have been received by the Lender.

 

54

 

  

Section 10.13 US PATRIOT Act Notice.  Notwithstanding anything herein to the
contrary, Lender hereby notifies the Borrower that, pursuant to the requirements
of Title III of the Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT Act) Act of 2001
(Public Law 107–56, signed into law October 26, 2001) and regulations
promulgated thereunder (collectively, the “Patriot Act”), Lender is required to
obtain, verify and record information that identifies the Loan Parties,
including without limitation the name, address and identification number of each
Loan Party.

 

[Remainder of Page Intentionally Left Blank]

 

55

 

  

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed, under seal in the case of the Borrower, by their respective authorized
officers as of the day and year first above written.

 

  PATRIOT TRANSPORTATION HOLDING, INC.         By:     Name: John D. Milton, Jr.
  Title: Vice President and Chief Financial Officer         WELLS FARGO BANK,
N.A.         By:     Name: Charles N. Kauffman   Title: Senior Vice President

 

56

 

  

ACKNOWLEDGMENT OF BORROWER

 

STATE OF GEORGIA

COUNTY OF CAMDEN

 

On this the ____ day of January, 2015, personally appeared John D. Milton, Jr.,
as the Vice President and Chief Financial Officer of Patriot Transportation
Holding, Inc., a Florida corporation (the “Borrower”), and before me, executed
the foregoing 2015 Credit Agreement dated as of January 30, 2015, between the
Borrower and Wells Fargo Bank, N.A. on behalf of such corporation. Such person:
(notary must check applicable box)

 

☐   is personally known to me. ☐   produced a current Florida driver’s license
as identification. ☐   produced ______________________ as identification.

 

{Notary Seal must be affixed}         Signature of Notary           Name of
Notary Typed, Printed or Stamped)     Commission Number (if not legible on
seal):     My Commission Expires (if not legible on seal):  

 

57

 

ACKNOWLEDGMENT OF WELLS FARGO BANK, N.A.

 

STATE OF GEORGIA

COUNTY OF CAMDEN

  

On this the ___ day of January, 2015, personally appeared Charles N. Kauffman,
as the Senior Vice President of Wells Fargo Bank, N.A., a national banking
association, and before me, executed the foregoing 2015 Credit Agreement dated
as of January 30, 2015, between the Borrower and Wells Fargo Bank, N.A., on
behalf of such national banking association. Such person: (notary must check
applicable box)

 

☐   is personally known to me. ☐   produced a current Florida driver’s license
as identification. ☐   produced ______________________ as identification.

 

{Notary Seal must be affixed}         Signature of Notary           Name of
Notary Typed, Printed or Stamped)     Commission Number (if not legible on
seal):     My Commission Expires (if not legible on seal):  

 

58

 

 

SCHEDULE 4.5

 

ENVIRONMENTAL MATTERS

 

None

 

59

 

 

SCHEDULE 4.14

 

Patriot Transportation Holding, Inc.

Subsidiaries
As of January 30, 2015

  

Patriot Transportation, Inc., of Florida

FRTL, Inc., a Florida corporation
Florida Rock & Tank Lines, Inc., a Florida corporation

STI Holding, Inc., formerly known as SunBelt Transport, Inc., a Florida
corporation

60

 

SCHEDULE 7.4

 

EXISTING INVESTMENTS

 

61

 

 

EXHIBIT A

 

REVOLVING CREDIT NOTE

 

$25,000,000.00 St. Mary’s, Georgia   January 30, 2015

 

FOR VALUE RECEIVED, the undersigned, PATRIOT TRANSPORTATION HOLDING, INC., a
Florida corporation (the “Borrower”), hereby promises to pay to Wells Fargo
Bank, N.A. (the “Lender”) or its registered assigns, at the office of Lender at
One Independent Drive, 25th Floor, Jacksonville, Florida 32202, on the
Commitment Termination Date (as defined in the 2015 Credit Agreement of even
date herewith (as the same may be amended, supplemented or otherwise modified
from time to time, the “Credit Agreement”)), between the Borrower and the
Lender, the lesser of the principal sum of Twenty Five Million and No/100
Dollars ($25,000,000.00) and the aggregate unpaid principal amount of all
Revolving Loans made by the Lender to the Borrower pursuant to the Credit
Agreement, in lawful money of the United States of America in immediately
available funds, and to pay interest from the date hereof on the principal
amount thereof from time to time outstanding, in like funds, at said office, at
the rate or rates per annum and payable on such dates as provided in the Credit
Agreement. In addition, should legal action or an attorney-at-law be utilized to
collect any amount due hereunder, the Borrower further promises to pay all costs
of collection, including the reasonable attorneys’ fees of the Lender.

 

The Borrower promises to pay interest, on demand, on any overdue principal and,
to the extent permitted by law, overdue interest from their due dates at a rate
or rates provided in the Credit Agreement.

 

This Note is issued in connection with, and is entitled to the benefits of, the
Credit Agreement which, among other things, contains provisions for the
acceleration of the maturity hereof upon the happening of certain events, for
prepayment of the principal hereof prior to the maturity hereof and for the
amendment or waiver of certain provisions of the Credit Agreement, all upon the
terms and conditions therein specified. THIS REVOLVING CREDIT NOTE SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF FLORIDA
AND ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.

 

  PATRIOT TRANSPORTATION HOLDING, INC.         By:     Name:     Title:  

 

A-1

 

 

AFFIDAVIT OF OUT-OF-STATE DELIVERY

 

STATE OF GEORGIA

COUNTY OF CAMDEN

 

Before me this day personally appeared ______________________________ (the
“Borrower’s Agent”), _______________ [title or capacity] of Patriot
Transportation Holding, Inc. (the “Borrower”) and ___________________________
the _____________ of Wells Fargo Bank, N.A. (the “Bank’s Agent”), a duly
authorized agent of Wells Fargo Bank, N.A., who being by me first duly sworn,
depose(s) and say(s):

 

1.      That on the date hereof the Borrower’s Agent executed the following
documents on behalf of the Borrower (collectively, the “Documents”) in the State
of Georgia:

 

    (a)      That certain Revolving Credit Note in the stated principal amount
of $25,000,000 dated January 30, 2015, made payable by Borrower to Wells Fargo
Bank, N.A. (the “Lender”) and (b) that certain 2015 Credit Agreement dated
January 30, 2015 between Borrower and Lender..

 

2.       That the Borrower’s Agent personally delivered the Documents to the
Bank’s Agent and the Bank’s Agent as agent of the Lender, accepted the Documents
on the date hereof in the State of Georgia.

 

FURTHER AFFIANTS SAYETH NOT.

 

  BORROWER’S AGENT:             [name of Borrower’s Agent]         BANK’S AGENT:
            [name of Bank’s Agent]

 

Sworn to and subscribed before me this ____ day of January, 2015, at
____________________, Georgia.

 

      Notary Public, State and County Aforesaid   My Commission No.:     My
Commission Expires:  

 

A-2

 

   

EXHIBIT B

 

RESERVED

 

B-1

 

  

EXHIBIT C

 

[FORM OF]
SUBSIDIARY GUARANTEE AGREEMENT

 

SUBSIDIARY GUARANTEE AGREEMENT dated as of January 30, 2015, among each of the
Subsidiaries listed on Schedule I hereto (each such subsidiary individually, a
“Guarantor” and collectively, the “Guarantors”) of PATRIOT TRANSPORTATION
HOLDING, INC., a Florida corporation (the “Borrower”), and WELLS FARGO BANK,
NATIONAL ASSOCIATION, a national banking association (the “Lender”).

 

Reference is made to the 2015 Credit Agreement of even date herewith (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), between the Borrower and the Lender. Capitalized terms used herein
and not defined herein shall have the meanings assigned to such terms in the
Credit Agreement.

 

The Lender has agreed to make Loans to the Borrower, pursuant to, and upon the
terms and subject to the conditions specified in, the Credit Agreement. Each of
the Guarantors is a direct or indirect wholly-owned Subsidiary of the Borrower,
and part of a common economic enterprise, and acknowledges that it will derive
substantial benefit from the making of the Loans by the Lenders because advances
thereunder will be used for working capital, capital expenditure and other
general corporate purposes of the Guarantors and will benefit the consolidated
group. The obligation of the Lender to make Loans is conditioned on, among other
things, the execution and delivery by the Guarantors of a Subsidiary Guarantee
Agreement in the form hereof. As consideration therefor and in order to induce
the Lender to make Loans, the Guarantors are willing to execute this Subsidiary
Guarantee Agreement.

 

Accordingly, the parties hereto agree as follows:

 

Section 1.        Guarantee. Each Guarantor unconditionally guarantees, jointly
with the other Guarantors and severally, (a) the due and punctual payment of (i)
the principal of and premium, if any, and interest (including interest accruing
during the pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding) on
the Loans, when and as due, whether at maturity, by acceleration, upon one or
more dates set for prepayment or otherwise and (ii) all other monetary
obligations, including fees, costs, expenses and indemnities, whether primary,
secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), of the Loan Parties to the Lender under the
Credit Agreement and the other Loan Documents, (b) the due and punctual
performance of all covenants, agreements, obligations and liabilities of the
Loan Parties under or pursuant to the Credit Agreement and the other Loan
Documents; and (c) the due and punctual payment and performance of all
obligations of the Borrower, monetary or otherwise, under each Hedging Agreement
entered into with a counterparty that was the Lender or an Affiliate of a Lender
at the time such Hedging Agreement was entered into (all the monetary and other
obligations referred to in the preceding clauses (a) through (c) being
collectively called the “Obligations”). Each Guarantor further agrees that the
Obligations may be extended or renewed, in whole or in part, without notice to
or further assent from it, and that it will remain bound upon its guarantee
notwithstanding any extension or renewal of any Obligation.

 

C-1

 

 

Section 2.         Obligations Not Waived. To the fullest extent permitted by
applicable law, each Guarantor waives presentment to, demand of payment from and
protest to the Borrower of any of the Obligations, and also waives notice of
acceptance of its guarantee and notice of protest for nonpayment. To the fullest
extent permitted by applicable law, the obligations of each Guarantor hereunder
shall not be affected by (a) the failure of the Lender to assert any claim or
demand or to enforce or exercise any right or remedy against the Borrower or any
other Guarantor under the provisions of the Credit Agreement, any other Loan
Document or otherwise, (b) any rescission, waiver, amendment or modification of,
or any release from any of the terms or provisions of, this Agreement, any other
Loan Document, any Guarantee or any other agreement, including with respect to
any other Guarantor under this Agreement, or (c) the failure to perfect any
security interest in, or the release of, any of the security held by or on
behalf of the Lender.

 

Section 3.         Guarantee of Payment. Each Guarantor further agrees that its
guarantee constitutes a guarantee of payment when due and not of collection, and
waives any right to require that any resort be had by the Lender to any of the
security held for payment of the Obligations or to any balance of any deposit
account or credit on the books of the Lender in favor of the Borrower or any
other person.

 

Section 4.         No Discharge or Diminishment of Guarantee. The obligations of
each Guarantor hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason (other than the indefeasible payment in
full in cash of the Obligations), including any claim of waiver, release,
surrender, alteration or compromise of any of the Obligations, and shall not be
subject to any defense or setoff, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality or unenforceability of the
Obligations or otherwise. Without limiting the generality of the foregoing, the
obligations of each Guarantor hereunder shall not be discharged or impaired or
otherwise affected by the failure of the Lender to assert any claim or demand or
to enforce any remedy under the Credit Agreement, any other Loan Document or any
other agreement, by any waiver or modification of any provision of any thereof,
by any default, failure or delay, willful or otherwise, in the performance of
the Obligations, or by any other act or omission that may or might in any manner
or to the extent vary the risk of any Guarantor or that would otherwise operate
as a discharge of each Guarantor as a matter of law or equity (other than the
indefeasible payment in full in cash of all the Obligations).

 

Section 5.        Defenses of Borrower Waived. To the fullest extent permitted
by applicable law, each Guarantor waives any defense based on or arising out of
any defense of the Borrower or the unenforceability of the Obligations or any
part thereof from any cause, or the cessation from any cause of the liability of
the Borrower, other than the final and indefeasible payment in full in cash of
the Obligations. The Lender may, at their election, foreclose on any security
held by one or more of them by one or more judicial or nonjudicial sales, accept
an assignment of any such security in lieu of foreclosure, compromise or adjust
any part of the Obligations, make any other accommodation with the Borrower or
any other guarantor, without affecting or impairing in any way the liability of
any Guarantor hereunder except to the extent the Obligations have been fully,
finally and indefeasibly paid in cash. Pursuant to applicable law, each
Guarantor waives any defense arising out of any such election even though such
election operates, pursuant to applicable law, to impair or to extinguish any
right of reimbursement or subrogation or other right or remedy of such Guarantor
against the Borrower or any other Guarantor or guarantor, as the case may be, or
any security.

 

C-2

 

 

Section 6.         Agreement to Pay; Subordination. In furtherance of the
foregoing and not in limitation of any other right that the Lender has at law or
in equity against any Guarantor by virtue hereof, upon the failure of the
Borrower or any other Loan Party to pay any Obligation when and as the same
shall become due, whether at maturity, by acceleration, after notice of
prepayment or otherwise, each Guarantor hereby promises to and will forthwith
pay, or cause to be paid, to the Lender in cash the amount of such unpaid
Obligations. Upon payment by any Guarantor of any sums to the Lender, all rights
of such Guarantor against the Borrower arising as a result thereof by way of
right of subrogation, contribution, reimbursement, indemnity or otherwise shall
in all respects be subordinate and junior in right of payment to the prior
indefeasible payment in full in cash of all the Obligations. In addition, any
indebtedness of the Borrower now or hereafter held by any Guarantor is hereby
subordinated in right of payment to the prior payment in full in cash of the
Obligations. If any amount shall erroneously be paid to any Guarantor on account
of (i) such subrogation, contribution, reimbursement, indemnity or similar right
or (ii) any such indebtedness of the Borrower, such amount shall be held in
trust for the benefit of the Lender and shall forthwith be paid to the Lender to
be credited against the payment of the Obligations, whether matured or
unmatured, in accordance with the terms of the Loan Documents.

 

Section 7.         Information. Each Guarantor assumes all responsibility for
being and keeping itself informed of the Borrower’s financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the Obligations and the nature, scope and extent of the risks that such
Guarantor assumes and incurs hereunder, and agrees that the Lender will have no
duty to advise any of the Guarantors of information known to it or any of them
regarding such circumstances or risks.

 

Section 8.        Representations and Warranties. Each Guarantor represents and
warrants as to itself that all representations and warranties relating to it (as
a Subsidiary of the Borrower) contained in the Credit Agreement are true and
correct.

 

Section 9.         Termination. The guarantees made hereunder (a) shall
terminate when all the Obligations have been paid in full in cash and the Lender
has no further commitment to lend under the Credit Agreement and (b) shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of any Obligation is rescinded or must otherwise
be restored by any Lender or any Guarantor upon the bankruptcy or reorganization
of the Borrower, any Guarantor or otherwise. In connection with the foregoing,
the Lender shall execute and deliver to such Guarantor or Guarantor’s designee,
at such Guarantor’s expense, any documents or instruments which such Guarantor
shall reasonably request from time to time to evidence such termination and
release.

 

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Section 10.       Binding Effect; Several Agreement; Assignments. Whenever in
this Agreement any of the parties hereto is referred to, such reference shall be
deemed to include the successors and assigns of such party; and all covenants,
promises and agreements by or on behalf of the Guarantors that are contained in
this Agreement shall bind and inure to the benefit of each party hereto and
their respective successors and assigns. This Agreement shall become effective
as to any Guarantor when a counterpart hereof executed on behalf of such
Guarantor shall have been delivered to the Lender, and a counterpart hereof
shall have been executed on behalf of the Lender, and thereafter shall be
binding upon such Guarantor and the Lender and their respective successors and
assigns, and shall inure to the benefit of such Guarantor, and the Lender, and
their respective successors and assigns, except that no Guarantor shall have the
right to assign its rights or obligations hereunder or any interest herein (and
any such attempted assignment shall be void). If all of the capital stock of a
Guarantor is sold, transferred or otherwise disposed of pursuant to a
transaction permitted by the Credit Agreement, such Guarantor shall be released
from its obligations under this Agreement without further action. This Agreement
shall be construed as a separate agreement with respect to each Guarantor and
may be amended, modified, supplemented, waived or released with respect to any
Guarantor without the approval of any other Guarantor and without affecting the
obligations of any other Guarantor hereunder.

 

Section 11.       Waivers; Amendment.

 

(a)      No failure or delay of the Lender in exercising any power or right
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights of the Lender
hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provision of this Agreement or consent to any departure by any Guarantor
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) below, and then such waiver and consent shall be effective only in
the specific instance and for the purpose for which given. No notice or demand
on any Guarantor in any case shall entitle such Guarantor to any other or
further notice in similar or other circumstances.

 

(b)      Neither this Agreement nor any provision hereof may be waived, amended
or modified except pursuant to a written agreement entered into between the
Guarantors with respect to which such waiver, amendment or modification relates
and the Lender.

 

Section 12.     Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF FLORIDA.

 

Section 13.       Notices. All communications and notices hereunder shall be in
writing and given as provided in Section 10.1 of the Credit Agreement. All
communications and notices hereunder to each Guarantor shall be given to it at
its address set forth on Schedule I attached hereto.

 

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Section 14.       Survival of Agreement; Severability.

 

(a)      All covenants, agreements representations and warranties made by the
Guarantors herein and in the certificates or other instruments prepared or
delivered in connection with or pursuant to this Agreement or the other Loan
Documents shall be considered to have been relied upon by the Lender and shall
survive the making by the Lender of the Loans regardless of any investigation
made by any of them or on their behalf, and shall continue in full force and
effect as long as the principal of or any accrued interest on any Loan or any
other fee or amount payable under this Agreement or any other Loan Document is
outstanding and unpaid and as long as the Revolving Commitment has not been
terminated.

 

(b)      In the event one or more of the provisions contained in this Agreement
or in any other Loan Document should be held invalid, illegal or unenforceable
in any respect, the validity, legality and enforceability of the remaining
provisions contained herein and therein shall not in any way be affected or
impaired thereby (it being understood that the invalidity of a particular
provision in a particular jurisdiction shall not in and of itself affect the
validity of such provision in any other jurisdiction). The parties shall
endeavor in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.

 

Section 15.       Counterparts. This Agreement may be executed in counterparts,
each of which shall constitute an original, but all of which when taken together
shall constitute a single contract (subject to Section 10), and shall become
effective as provided in Section 10. Delivery of a PDF of an executed signature
page to this Agreement by electronic transmission shall be as effective as
delivery of a manually executed counterpart of this Agreement.

 

Section 16.       Rules of Interpretation. The rules of interpretation specified
in Section 1.4 of the Credit Agreement shall be applicable to this Agreement.

 

Section 17.        Jurisdiction; Consent to Service of Process.

 

(a)      Each Guarantor hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of the Circuit Court
of Duval County, Florida, or any Florida State court or Federal court of the
United States of America sitting in Duval County, Florida, and any appellate
court from any thereof, in any action or proceeding arising out of or relating
to this Agreement or the other Loan Documents, or for recognition or enforcement
of any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such Duval County, Florida State court
or, to the extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that the Lender may otherwise have to bring any action or proceeding
relating to this Agreement or the other Loan Documents against any Guarantor or
its properties in the courts of any jurisdiction.

 

(b)      Each Guarantor hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or the other Loan Documents in the
Circuit Court of Duval County, Florida or any other appropriate Florida State or
Federal court. Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.

 

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Section 18.       Arbitration.

 

(a)      Arbitration. The parties hereto agree, upon demand by any party, to
submit to binding arbitration all claims, disputes and controversies between or
among them (and their respective employees, officers, directors, attorneys, and
other agents), whether in tort, contract or otherwise in any way arising out of
or relating to (i) any credit subject hereto, or any of the Loan Documents, and
their negotiation, execution, collateralization, administration, repayment,
modification, extension, substitution, formation, inducement, enforcement,
default or termination; or (ii) requests for additional credit.

 

(b)      Governing Rules. Any arbitration proceeding will (i) proceed in a
location in Florida selected by the American Arbitration Association (“AAA”);
(ii) be governed by the Federal Arbitration Act (Title 9 of the United States
Code), notwithstanding any conflicting choice of law provision in any of the
documents between the parties; and (iii) be conducted by the AAA, or such other
administrator as the parties shall mutually agree upon, in accordance with the
AAA’s commercial dispute resolution procedures, unless the claim or counterclaim
is at least $1,000,000.00 exclusive of claimed interest, arbitration fees and
costs in which case the arbitration shall be conducted in accordance with the
AAA’s optional procedures for large, complex commercial disputes (the commercial
dispute resolution procedures or the optional procedures for large, complex
commercial disputes to be referred to herein, as applicable, as the “Rules”). If
there is any inconsistency between the terms hereof and the Rules, the terms and
procedures set forth herein shall control. Any party who fails or refuses to
submit to arbitration following a demand by any other party shall bear all costs
and expenses incurred by such other party in compelling arbitration of any
dispute. Nothing contained herein shall be deemed to be a waiver by any party
that is a bank of the protections afforded to it under 12 U.S.C. §91 or any
similar applicable state law.

 

(c)      No Waiver of Provisional Remedies, Self-Help and Foreclosure. The
arbitration requirement does not limit the right of any party to (i) foreclose
against real or personal property collateral; (ii) exercise self-help remedies
relating to collateral or proceeds of collateral such as setoff or repossession;
or (iii) obtain provisional or ancillary remedies such as replevin, injunctive
relief, attachment or the appointment of a receiver, before during or after the
pendency of any arbitration proceeding. This exclusion does not constitute a
waiver of the right or obligation of any party to submit any dispute to
arbitration or reference hereunder, including those arising from the exercise of
the actions detailed in sections (i), (ii) and (iii) of this paragraph.

 

(d)      Arbitrator Qualifications and Powers. Any arbitration proceeding in
which the amount in controversy is $5,000,000.00 or less will be decided by a
single arbitrator selected according to the Rules, and who shall not render an
award of greater than $5,000,000.00. Any dispute in which the amount in
controversy exceeds $5,000,000.00 shall be decided by majority vote of a panel
of three arbitrators; provided however, that all three arbitrators must actively
participate in all hearings and deliberations. The arbitrator will be a neutral
attorney licensed in the State of Florida or a neutral retired judge of the
state or federal judiciary of Florida, in either case with a minimum of ten
years experience in the substantive law applicable to the subject matter of the
dispute to be arbitrated. The arbitrator will determine whether or not an issue
is arbitratable and will give effect to the statutes of limitation in
determining any claim. In any arbitration proceeding the arbitrator will decide
(by documents only or with a hearing at the arbitrator’s discretion) any
pre-hearing motions which are similar to motions to dismiss for failure to state
a claim or motions for summary adjudication. The arbitrator shall resolve all
disputes in accordance with the substantive law of Florida and may grant any
remedy or relief that a court of such state could order or grant within the
scope hereof and such ancillary relief as is necessary to make effective any
award. The arbitrator shall also have the power to award recovery of all costs
and fees, to impose sanctions and to take such other action as the arbitrator
deems necessary to the same extent a judge could pursuant to the Federal Rules
of Civil Procedure, the Florida Rules of Civil Procedure or other applicable
law. Judgment upon the award rendered by the arbitrator may be entered in any
court having jurisdiction. The institution and maintenance of an action for
judicial relief or pursuit of a provisional or ancillary remedy shall not
constitute a waiver of the right of any party, including the plaintiff, to
submit the controversy or claim to arbitration if any other party contests such
action for judicial relief.

 

C-6

 

 

(e)      Discovery. In any arbitration proceeding, discovery will be permitted
in accordance with the Rules. All discovery shall be expressly limited to
matters directly relevant to the dispute being arbitrated and must be completed
no later than 20 days before the hearing date. Any requests for an extension of
the discovery periods, or any discovery disputes, will be subject to final
determination by the arbitrator upon a showing that the request for discovery is
essential for the party’s presentation and that no alternative means for
obtaining information is available.

 

(f)       Class Proceedings and Consolidations. No party hereto shall be
entitled to join or consolidate disputes by or against others in any
arbitration, except parties who have executed any Loan Document, or to include
in any arbitration any dispute as a representative or member of a class, or to
act in any arbitration in the interest of the general public or in a private
attorney general capacity.

 

(g)     Payment Of Arbitration Costs And Fees. The arbitrator shall award all
costs and expenses of the arbitration proceeding.

 

(h)      Miscellaneous. To the maximum extent practicable, the AAA, the
arbitrators and the parties shall take all action required to conclude any
arbitration proceeding within 180 days of the filing of the dispute with the
AAA. No arbitrator or other party to an arbitration proceeding may disclose the
existence, content or results thereof, except for disclosures of information by
a party required in the ordinary course of its business or by applicable law or
regulation. If more than one agreement for arbitration by or between the parties
potentially applies to a dispute, the arbitration provision most directly
related to the Loan Documents or the subject matter of the dispute shall
control. This arbitration provision shall survive termination, amendment or
expiration of any of the Loan Documents or any relationship between the parties.

 

C-7

 

 

Section 19.      Additional Guarantors. Pursuant to Section 5.10 of the Credit
Agreement, certain Subsidiaries that were not in existence on the date of the
Credit Agreement are required to enter into this Agreement as a Guarantor. Upon
execution and delivery after the date hereof by the Lender and such Subsidiary
of an instrument in the form of Annex I, such Subsidiary shall become a
Guarantor hereunder with the same force and effect as if originally named as a
Guarantor herein. The execution and delivery of any instrument adding an
additional Guarantor as a party to this Agreement shall not require the consent
of any other Guarantor hereunder. The rights and obligations of each Guarantor
hereunder shall remain in full force and effect notwithstanding the addition of
any new Guarantor as a party to this Agreement.

 

Section 20.      Right of Setoff. If an Event of Default shall have occurred and
be continuing, Lender is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other Indebtedness at any time owing by such Lender to or for the credit or the
account of any Guarantor against any or all the obligations of such Guarantor
now or hereafter existing under this Agreement and the other Loan Documents held
by such Lender, irrespective of whether or not such Person shall have made any
demand under this Agreement or any other Loan Document and although such
obligations may be unmatured. The rights of each Lender under this Section 20
are in addition to other rights and remedies (including other rights of setoff)
which such Lender may have.

 

C-8

 

 

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the day and year first above written.

  

EACH OF THE SUBSIDIARIES LISTED ON SCHEDULE I HERETO         By:     Name:  
Title:         WELLS FARGO BANK, N.A.         By:     Name:   Title:

 

 

C-9

 

 

SCHEDULE I TO THE
SUBSIDIARY GUARANTEE AGREEMENT

 

Guarantor(s)   Address       Patriot Transportation, Inc., of Florida   200 W.
Forsyth Street, 7th Floor     Jacksonville, FL 32202       Florida Rock and Tank
Lines, Inc.   200 W. Forsyth Street, 7th Floor     Jacksonville, FL 32202

 

C-10

 

  

ANNEX I TO THE
SUBSIDIARY GUARANTEE AGREEMENT

 

SUPPLEMENT NO. [____] dated as of [_________________], to the Subsidiary
Guarantee Agreement (the “Guarantee Agreement”) dated as of January 30, 2015
among each of the subsidiaries listed on Schedule I thereto (each such
Subsidiary individually, a “Guarantor” and collectively, the “Guarantors”) of
PATRIOT TRANSPORTATION HOLDING, INC., a Florida corporation (the “Borrower”),
and WELLS FARGO BANK, N.A., a national banking association (the “Lender”).

 

A.      Reference is made to the 2015 Credit Agreement dated as of January 30,
2015 (as amended, supplemented or otherwise modified from time to time, the
“Credit Agreement”), between the Borrower and the Lender. Capitalized terms used
herein and not otherwise defined herein shall have the meanings assigned to such
terms in the Credit Agreement.

 

B.      The Guarantors have entered into the Guarantee Agreement in order to
induce the Lenders to make Loans. Pursuant to Section 5.10 of the Credit
Agreement, certain Subsidiaries that were not in existence on the date of the
Credit Agreement are required to enter into the Guarantee Agreement as a
Guarantor. Section 19 of the Guarantee Agreement provides that additional
Subsidiaries of the Borrower may become Guarantors under the Guarantee Agreement
by execution and delivery of an instrument in the form of this Supplement. The
undersigned Subsidiary of the Borrower (the “New Guarantor”) is executing this
Supplement in accordance with the requirements of the Credit Agreement to become
a Guarantor under the Guarantee Agreement in order to induce the Lenders to make
additional Loans and as consideration for Loans previously made.

 

Accordingly, the Lender and the New Guarantor agree as follows:

 

Section 1.        In accordance with Section 19 of the Guarantee Agreement, the
New Guarantor by its signature below becomes a Guarantor under the Guarantee
Agreement with the same force and effect as if originally named therein as a
Guarantor and the New Guarantor hereby (a) agrees to all the terms and
provisions of the Guarantee Agreement applicable to it as Guarantor thereunder
and (b) represents and warrants that the representations and warranties made by
it as a Guarantor thereunder are true and correct on and as of the date hereof.
Each reference to a Guarantor in the Guarantee Agreement shall be deemed to
include the New Guarantor. The Guarantee Agreement is hereby incorporated herein
by reference.

 

Section 2.        The New Guarantor represents and warrants to the Lender that
this Supplement has been duly authorized, executed and delivered by it and
constitutes its legal, valid and binding obligation, enforceable against it in
accordance with its terms.

 

Section 3.         This Supplement may be executed in counterparts each of which
shall constitute an original, but all of which when taken together shall
constitute a single contract. This Supplement shall become effective when the
Lender shall have received counterparts of this Supplement that, when taken
together, bear the signatures of the New Guarantor and the Lender. Delivery of a
PDF version of an executed signature page to this Supplement by electronic
transmission shall be as effective as delivery of a manually signed counterpart
of this Supplement.

 

C-11

 

 

Section 4.        Except as expressly supplemented hereby, the Guarantee
Agreement shall remain in full force and effect.

 

Section 5.        THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF FLORIDA.

 

Section 6.        In case any one or more of the provisions contained in this
Supplement should be held invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein and in the Guarantee Agreement shall not in any way be affected or
impaired thereby (it being understood that the invalidity of a particular
provision hereof in a particular jurisdiction shall not in and of itself affect
the validity of such provision in any other jurisdiction). The parties hereto
shall endeavor in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.

 

Section 7.        All communications and notices hereunder shall be in writing
and given as provided in Section 13 of the Guarantee Agreement. All
communications and notices hereunder to the New Guarantor shall be given to it
at the address set forth under its signature below, with a copy to the Borrower.

 

Section 8.        The New Guarantor agrees to reimburse the Lender for its
out-of-pocket expenses in connection with this Supplement, including the fees,
disbursements and other charges of counsel for the Lender.

 

IN WITNESS WHEREOF, the New Guarantor and the Lender have duly executed this
Supplement to the Guarantee Agreement as of the day and year first above
written.

        [Name of New Guarantor]         By:   Name:   Title:   Address:        

 

C-12

 

        WELLS FARGO BANK, N.A.         By:   Name:   Title:

  

C-13

 

 

EXHIBIT D

 

[FORM OF]
INDEMNITY, SUBROGATION AND CONTRIBUTION AGREEMENT

 

INDEMNITY, SUBROGATION AND CONTRIBUTION AGREEMENT dated as of January 30, 2015,
among PATRIOT TRANSPORTATION HOLDING, INC., a Florida corporation (the
“Borrower”), each Subsidiary listed on Schedule I hereto (the “Guarantors”), and
WELLS FARGO BANK, N.A., a national banking association (the “Lender”).

 

Reference is made to (a) the 2015 Credit Agreement dated as of January 30, 2015
(as amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among the Borrower and the Lender and (b) the Subsidiary Guarantee
Agreement dated as of January 30, 2015, among the Guarantors and the Lender (as
amended, supplemented or otherwise modified from time to time, the “Guarantee
Agreement”). Capitalized terms used herein and not defined herein shall have the
meanings assigned to such terms in the Credit Agreement.

 

The Lender has agreed to make Loans to the Borrower, pursuant to, and upon the
terms and subject to the conditions specified in, the Credit Agreement. The
Guarantors have guaranteed such Loans and the other Obligations (as defined in
the Guarantee Agreement) of the Borrower under the Credit Agreement pursuant to
the Guarantee Agreement. The obligation of the Lenders to make Loans is
conditioned on, among other things, the execution and delivery by the Borrower
and the Guarantors of an agreement in the form hereof.

 

Accordingly, the Borrower, each Guarantor and the Lender agree as follows:

 

Section 1.        Indemnity and Subrogation. In addition to all such rights of
indemnity and subrogation as the Guarantors may have under applicable law (but
subject to Section 3), the Borrower agrees that (a) in the event a payment shall
be made by any Guarantor under the Guarantee Agreement, the Borrower shall
indemnify such Guarantor for the full amount of such payment and such Guarantor
shall be subrogated to the rights of the person to whom such payment shall have
been made to the extent of such payment.

 

Section 2.       Contribution and Subrogation. Each Guarantor (a “Contributing
Guarantor”) agrees (subject to Section 3) that, in the event a payment shall be
made by any other Guarantor under the Guarantee Agreement and such other
Guarantor (the “Claiming Guarantor”) shall not have been fully indemnified by
the Borrower as provided in Section 1, the Contributing Guarantor shall
indemnify the Claiming Guarantor in an amount equal to the amount of such
payment in each case multiplied by a fraction of which the numerator shall be
the net worth of the Contributing Guarantor on the date hereof and the
denominator shall be the aggregate net worth of all the Guarantors on the date
hereof (or, in the case of any Guarantor becoming a party hereto pursuant to
Section 12, the date of the Supplement hereto executed and delivered by such
Guarantor). Any Contributing Guarantor making any payment to a Claiming
Guarantor pursuant to this Section 2 shall be subrogated to the rights of such
Claiming Guarantor under Section 1 to the extent of such payment.

 

D-1

 

  

Section 3.       Subordination. Notwithstanding any provision of this Agreement
to the contrary, all rights of the Guarantors under Sections 1 and 2 and all
other rights of indemnity, contribution or subrogation under applicable law or
otherwise shall be fully subordinated to the indefeasible payment in full in
cash of the Obligations. No failure on the part of the Borrower or any Guarantor
to make the payments required under applicable law or otherwise shall in any
respect limit the obligations and liabilities of any Guarantor with respect to
its obligations hereunder, and each Guarantor shall remain liable for the full
amount of the obligations of such Guarantor hereunder.

 

Section 4.         Termination. This Agreement shall survive and be in full
force and effect so long as any Obligation is outstanding and has not been
indefeasibly paid in full in cash, and so long as the Revolving Commitment under
the Credit Agreement has not been terminated, and shall continue to be effective
or be reinstated, as the case may be, if at any time payment, or any part
thereof, of any Obligation is rescinded or must otherwise be restored by any
Lender or any Guarantor upon the bankruptcy or reorganization of the Borrower,
any Guarantor or otherwise.

 

Section 5.        Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF FLORIDA.

 

Section 6.        No Waiver; Amendment.

 

(a)     No failure on the part of the Lender or any Guarantor to exercise, and
no delay in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right,
power or remedy by the Lender or any Guarantor preclude any other or further
exercise thereof or the exercise of any other right, power or remedy. All
remedies hereunder are cumulative and are not exclusive of any other remedies
provided by law. None of the Lender and the Guarantors shall be deemed to have
waived any rights hereunder unless such waiver shall be in writing and signed by
such parties.

 

(b)     Neither this Agreement nor any provision hereof may be waived, amended
or modified except pursuant to a written agreement entered into between the
Borrower, the Guarantors and the Lender.

 

Section 7.        Notices. All communications and notices hereunder shall be in
writing and given as provided in the Guarantee Agreement and addressed as
specified therein.

 

Section 8.         Binding Agreement; Assignments. Whenever in this Agreement
any of the parties hereto is referred to, such reference shall be deemed to
include the successors and assigns of such party; and all covenants, promises
and agreements by or on behalf of the parties that are contained in this
Agreement shall bind and inure to the benefit of their respective successors and
assigns. Neither the Borrower nor any Guarantor may assign or transfer any of
its rights or obligations hereunder (and any such attempted assignment or
transfer shall be void) without the prior written consent of the Lender.
Notwithstanding the foregoing, at the time any Guarantor is released from its
obligations under the Guarantee Agreement in accordance with such Guarantee
Agreement and the Credit Agreement, such Guarantor will cease to have any rights
or obligations under this Agreement.

 

D-2

 

  

Section 9.         Survival of Agreement; Severability.

 

(a)     All covenants and agreements made by the Borrower and each Guarantor
herein and in the certificates or other instruments prepared or delivered in
connection with this Agreement or the other Loan Documents shall be considered
to have been relied upon by the Lender and each Guarantor and shall survive the
making by the Lenders of the Loans, and shall continue in full force and effect
as long as the principal of or any accrued interest on any Loans or any other
fee or amount payable under the Credit Agreement or this Agreement or under any
of the other Loan Documents is outstanding and unpaid and as long the Revolving
Commitment has not been terminated.

 

(b)     In case one or more of the provisions contained in this Agreement should
be held invalid, illegal or unenforceable in any respect, no party hereto shall
be required to comply with such provision for so long as such provision is held
to be invalid, illegal or unenforceable, but the validity, legality and
enforceability of the remaining provisions contained herein shall not in any way
be affected or impaired thereby. The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to that
of the invalid, illegal or unenforceable provisions.

 

Section 10.       Counterparts. This Agreement may be executed in counterparts
(and by different parties hereto on different counterparts) each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract. This Agreement shall be effective with respect to any Guarantor
when a counterpart bearing the signature of such Guarantor shall have been
delivered to the Lender. Delivery of a PDF copy of an executed signature page to
this Agreement by electronic transmission shall be as effective as delivery of a
manually signed counterpart of this Agreement.

 

Section 11.      Rules of Interpretation. The rules of interpretation specified
in Section 1.4 of the Credit Agreement shall be applicable to this Agreement.

 

Section 12.      Additional Guarantors. Pursuant to Section 5.10 of the Credit
Agreement, certain Subsidiaries of the Borrower that were not in existence on
the date of the Credit Agreement are required to enter into the Guarantee
Agreement as Guarantor. Upon the execution and delivery, after the date hereof,
by the Lender and such Subsidiary of an instrument in the form of Annex I
hereto, such Subsidiary shall become a Guarantor hereunder with the same force
and effect as if originally named as a Guarantor hereunder. The execution and
delivery of any instrument adding an additional Guarantor as a party to this
Agreement shall not require the consent of any Guarantor hereunder. The rights
and obligations of each Guarantor hereunder shall remain in full force and
effect notwithstanding the addition of any new Guarantor as a party to this
Agreement.

 

D-3

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized officers as of the date first appearing above.

   

  PATRIOT TRANSPORTATION HOLDING, INC.       By:   Name:   Title:         EACH
OF THE SUBSIDIARIES LISTED ON SCHEDULE I HERETO, as a Guarantor         By:    
Name:     Title:           WELLS FARGO BANK, N.A.         By:   Name:   Title:

 

D-4

 

 

SCHEDULE I

 

TO THE INDEMNITY, SUBROGATION
AND CONTRIBUTION AGREEMENT

 

Guarantors

 

Name   Address       Patriot Transportation, Inc., of Florida   200 W. Forsyth
Street, 7th Floor     Jacksonville, FL 32202       Florida Rock and Tank Lines,
Inc.   200 W. Forsyth Street, 7th Floor     Jacksonville, FL 32202

 

D-5

 

 

ANNEX I

 

TO INDEMNITY, SUBROGATION AND
CONTRIBUTION AGREEMENT

 

SUPPLEMENT NO. [____] dated as of [__________________], to the Indemnity,
Subrogation and Contribution Agreement dated as of January 30, 2015 (as the same
may be amended, supplemented or otherwise modified from time to time, the
“Indemnity, Subrogation and Contribution Agreement”) among PATRIOT
TRANSPORTATION HOLDING, INC., a Florida corporation (the “Borrower”), each
Subsidiary listed on Schedule I thereto (the “Guarantors”) and WELLS FARGO BANK,
N.A. (the “Lender”).

 

A.      Reference is made to (a) the 2015 Credit Agreement dated as of January
30, 2015 (as amended, supplemented or otherwise modified from time to time, the
“Credit Agreement”), between the Borrower and the Lender, and (b) the Subsidiary
Guarantee Agreement dated as of January 30, 2015, among the Guarantors and the
Lender (as amended, supplemented or otherwise modified from time to time, the
“Guarantee Agreement”).

 

B.      Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Indemnity, Subrogation and
Contribution Agreement and the Credit Agreement.

 

C.      The Borrower and the Guarantors have entered into the Indemnity,
Subrogation and Contribution Agreement in order to induce the Lender to make
Loans. Pursuant to Section 5.10 of the Credit Agreement, certain Subsidiaries
that were not in existence on the date of the Credit Agreement are required to
enter into the Guarantee Agreement as a Guarantor. Section 12 of the Indemnity,
Subrogation and Contribution Agreement provides that additional Subsidiaries may
become Guarantors under the Indemnity, Subrogation and Contribution Agreement by
execution and delivery of an instrument in the form of this Supplement. The
undersigned Subsidiary (the “New Guarantor”) is executing this Supplement in
accordance with the requirements of the Credit Agreement to become a Guarantor
under the Indemnity, Subrogation and Contribution Agreement in order to induce
the Lenders to make additional Loans and as consideration for Loans previously
made.

 

Accordingly, the Lender and the New Guarantor agree as follows:

 

Section 1.        In accordance with Section 12 of the Indemnity, Subrogation
and Contribution Agreement, the New Guarantor by its signature below becomes a
Guarantor under the Indemnity, Subrogation and Contribution Agreement with the
same force and effect as if originally named therein as a Guarantor and the New
Guarantor hereby agrees to all the terms and provisions of the Indemnity,
Subrogation and Contribution Agreement applicable to it as Guarantor thereunder.
Each reference to a Guarantor in the Indemnity, Subrogation and Contribution
Agreement shall be deemed to include the New Guarantor. The Indemnity,
Subrogation and Contribution Agreement is hereby incorporated herein by
reference.

 

D-6

 

  

Section 2.        The New Guarantor represents and warrants to the Lender that
this Supplement has been duly authorized, executed and delivered by it and
constitutes its legal, valid and binding obligation, enforceable against it in
accordance with its terms.

 

Section 3.       This Supplement may be executed in counterparts (and by
different parties hereto on different counterparts) each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract. This Supplement shall become effective when the Lender shall
have received counterparts of this Supplement that, when taken together, bear
the signature of the New Guarantor and the Lender. Delivery of a PDF copy of an
executed signature page to this Supplement by electronic transmission shall be
as effective as delivery of a manually signed counterpart of this Supplement.

 

Section 4.        Except as expressly supplemented hereby, the Indemnity,
Subrogation and Contribution Agreement shall remain in full force and effect.

 

Section 5.         THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF FLORIDA.

 

Section 6.         In case any one or more of the provisions contained in this
Supplement should be held invalid, illegal or unenforceable in any respect,
neither party hereto shall be required to comply with such provision for so long
as such provision is held to be invalid, illegal or unenforceable, but the
validity, legality and enforceability of the remaining provisions contained
herein and in the Indemnity, Subrogation and Contribution Agreement shall not in
any way be affected or impaired. The parties hereto shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to that
of the invalid, illegal or unenforceable provisions.

 

Section 7.         All communications and notices hereunder shall be in writing
and given as provided in Section 7 of the Indemnity, Subrogation and
Contribution Agreement. All communications and notices hereunder to the New
Guarantor shall be given to it at the address set forth under its signature.

 

Section 8.        The New Guarantor agrees to reimburse the Lender for its
reasonable out-of-pocket expenses in connection with this Supplement, including
the reasonable fees, other charges and disbursements of counsel for the Lender.

 

D-7

 

  

IN WITNESS WHEREOF, the New Guarantor and the Lender have duly executed this
Supplement to the Indemnity, Subrogation and Contribution Agreement as of the
day and year first above written.

        [Name of New Guarantor]         By:   Name:   Title:   Address:        
  WELLS FARGO BANK, N.A.         By:     Name:     Title:  

 

D-8

 

 

SCHEDULE I

 

TO SUPPLEMENT NO. ____ TO THE INDEMNITY,
SUBROGATION AND CONTRIBUTION AGREEMENT

 

Guarantors

 

Name   Address

 

 

D-9

 

 

EXHIBIT 2.3

 

NOTICE OF REVOLVING BORROWING

 

[Date]

 

Wells Fargo Bank, N.A.

One Independent Drive, 25th Floor

Jacksonville, Florida 32202

 

Dear Sirs:

 

Reference is made to the 2015 Credit Agreement dated as of January 30, 2015 (as
amended and in effect on the date hereof, the “Credit Agreement”), between the
undersigned, as Borrower, and Wells Fargo Bank, N.A., as Lender. Terms defined
in the Credit Agreement are used herein with the same meanings. This notice
constitutes a Notice of Revolving Borrowing, and the Borrower hereby requests a
Revolving Loan Borrowing under the Credit Agreement, and in that connection the
Borrower specifies the following information with respect to the Revolving Loan
Borrowing requested hereby:

 

(A) Aggregate principal amount of Revolving Loan Borrowing[2]:
_____________________________     (B)

Date of Revolving Loan Borrowing (which is a New York Business Day):
_____________________     (C) Interest Rate basis[3]:
___________________________________________________________     (D) Interest
Period[4]: _______________________________________________________________    
(E) Location and number of Borrower’s account to which proceeds of Revolving
Loan Borrowing are to be disbursed:
____________________________________________________________

______________________

2 Not less than $100,000.00 and an integral multiple of $50,000.00.

3 Eurodollar Borrowing or Daily One Month LIBOR Borrowing

4 Which must comply with the definition of “Interest Period” and end not later
than the Commitment Termination Date.

 

 

  

The Borrower hereby represents and warrants that the conditions specified in
paragraphs (a), (b) and (c) of Section 3.2 of the Credit Agreement are
satisfied.

 

  Very truly yours,         PATRIOT TRANSPORTATION HOLDING, INC.         By:    
Name:     Title:  

 

 

 

 

 

EXHIBIT 2.7

 

NOTICE OF CONTINUATION/CONVERSION

 

[Date]

 

Wells Fargo Bank, N.A.

One Independent Drive, 25th Floor

Jacksonville, Florida 32202

 

Dear Sirs:

 

Reference is made to the 2015 Credit Agreement dated as of January 30, 2015 (as
amended and in effect on the date hereof, the “Credit Agreement”), between the
undersigned, as Borrower, and Wells Fargo Bank, N.A., as Lender. Terms defined
in the Credit Agreement are used herein with the same meanings. This notice
constitutes a Notice of Revolving Borrowing, and the Borrower hereby requests a
Revolving Loan Borrowing under the Credit Agreement, and in that connection the
Borrower specifies the following information with respect to the Revolving Loan
Borrowing requested hereby:

 

(A) Revolving Loan Borrowing to which this request applies:
_________________________________     (B) Principal amount of Revolving Loan
Borrowing to be       converted/continued:
____________________________________________________________     (C) Effective
date of election (which is a New York Business Day):____________________________
    (D) Interest rate basis:
______________________________________________________________     (E) Interest
Period: _________________________________________________________________    

  Very truly yours,         PATRIOT TRANSPORTATION HOLDING, INC.         By:    
Name:     Title  

 

 

 

 

 

EXHIBIT 3.1(b)(iv)

 

FORM OF SECRETARY’S CERTIFICATE

 

Reference is made to the 2015 Credit Agreement dated as of January 30, 2015 (as
amended and in effect on the date hereof, the “Credit Agreement”), between the
undersigned, as Borrower, and Wells Fargo Bank, N.A., as Lender. Terms defined
in the Credit Agreement are used herein with the same meanings. This Certificate
is being delivered pursuant to Section 3.1(b)(iv) of the Credit Agreement.

 

I, [______________________], Secretary of the Borrower, DO HEREBY CERTIFY that:

 

(a)      annexed hereto as Exhibit A is a true and correct copy of the articles
of incorporation of the Borrower, which have not been amended, modified,
supplemented or restated except as set forth in Exhibit A and remain in full
force and effect as of the date hereof;

 

(b)      no proceeding have been instituted or are pending or contemplated with
respect to the dissolution, liquidation or sale of all or substantially all the
assets of the Borrower or threatening its existence or the forfeiture or any of
its corporate rights;

 

(c)      annexed hereto as Exhibit B is a true and correct copy of the Bylaws of
the Borrower as in effect on the date of the attached Resolutions and at all
times thereafter through the date hereof;

 

(d)      annexed hereto as Exhibit C is a true and correct copy of certain
resolutions duly adopted by the Board of Directors of the Borrower at a meeting
of said Board of Directors duly called and held on ___________________, 201_,
which resolutions are the only resolutions adopted by the Board of Directors of
the Borrower or any committee thereof relating to the Credit Agreement and the
other Loan Documents to which the Borrower is a party and the transactions
contemplated therein and have not been revoked, amended, supplemented or
modified and are in full force and effect on the date hereof; and

 

(e)      each of the persons named below is a duly elected and qualified officer
of the Borrower holding the respective office set forth opposite his or her name
and the signature set forth opposite each such person’s name is his or her
genuine signature:

 

Name Title Specimen Signature [Include all officers who are signing the Credit
Agreement or any other Loan Documents.]    

 

 

 

 

IN WITNESS WHEREOF, I have hereunto signed my name this ___ day of ____________,
2015.

 

_________________________________, Secretary

 

I, [_______________________], [____________________________] of the Borrower, do
hereby certify that [______________________] has been duly elected, is duly
qualified and is currently serving as the [Assistant] Secretary of the Borrower,
that the signature set forth above is [his/her] genuine signature and that
[he/she] has held such office at all times since [_________________].

 

IN WITNESS WHEREOF, I have hereunto signed my name this ___ day of ___________,
2015.

 

        Title:  

 

 

 

 

EXHIBIT 3.1(b)(vii)

 

FORM OF OFFICER’S CERTIFICATE

 

Reference is made to the 2015 Credit Agreement dated as of January 30, 2015 (as
amended and in effect on the date hereof, the “Credit Agreement”), between the
undersigned, as Borrower, and Wells Fargo Bank, N.A., as Lender. Terms defined
in the Credit Agreement are used herein with the same meanings. This Certificate
is being delivered pursuant to Section 3.1(b)(vii) of the Credit Agreement.

 

I, [________________________], [_________________] of the Borrower, DO HEREBY
CERTIFY that:

 

(a)       the representations and warranties of the Borrower set forth in the
Credit Agreement are true and correct on and as of the date hereof; and

 

(b)       no Default or Event of Default has occurred and is continuing at the
date hereof; and

 

(c)       since [the date], which is the date of the most recent financial
statements described in Section 5.1(a) of the Credit Agreement, there has been
no change which has had or could reasonably be expected to have a Material
Adverse Effect; and

 

(d)       no consents, approvals, authorizations, registrations or filings are
required to be made or obtained by or on behalf of the Borrower or any of the
Guarantors in connection with the Loans.

 

IN WITNESS WHEREOF, I have hereunto signed my name this ___ day of ___________,
2015.

 

  By:     Name:     Title  

 

 

 

 

EXHIBIT 3.1(c)

 

ISSUED AND OUTSTANDING LETTERS OF CREDIT

 

OBLIGATION    MATURITY    AMOUNT  LC NUMBER  Applicant  Beneficiary
 0000000349    9-26-2015    100,000.00   SM235598  Patriot Transportation
Holding Inc.  Florida Self-Insurers Guaranty  0000000356    10-02-2015  
 112,966.00   SM235634  Patriot Transportation Holding Inc.  National Union Fire
Insurance Co.  0000000364    10-15-2015    213,000.00   SM235644  Patriot
Transportation Holding Inc.  Continental Casualty Company and/or American
Casualty Company of Reading Pennsylvania  0000000414    10-02-2015  
 100,000.00   SM236500  Florida Rock & Tank Lines Inc.  Georgia Self Insurers
Guaranty  0000000463    10-02-2015    1,444,447.00   SM237878  Patriot
Transportation Holding Inc.  National Union Fire Insurance Company of Pittsburgh
 0000000679    10-02-2015    1,308,056.00    IS0252263U  Patriot Transportation
Holding Inc.  Hudson Indemnity

 

 

 

Annex I

 

Captive Investment Policy Statement

 

The primary criteria for investments shall be safety of principal and liquidity.
Return on investment shall not take precedence over safety of principal.

 

1. Investments may be either in fixed or floating rate instruments denominated
in U. S. dollars.

 

2. Investments can include U.S. Treasury Securities, U.S Government Agency
securities, U.S. Agency mortgage-backed securities and collateralized mortgage
obligations and U.S. Corporate Bonds. Investments in certificates of deposit and
time deposits in U.S. banks may also be made.

 

3. Investments will be made in various issuers to ensure proper diversification.

 

4. The fixed income portfolio shall be laddered to meet the cash flow needs of
the program. Generally ten to twenty percent of the portfolio will be invested
in securities having maturities of two years or less from the date of purchase.
For this purpose, floating rate certificates of deposit and notes, irrespective
of final maturity, are deemed to be mature on the next coupon-reset date. The
portfolio will generally invest in securities that mature in ten years or less
from the date of purchase.

 

5. In order for the securities of an issuer to qualify for investment of assets,
they must have either a Moody’s, S&P or Fitch rating of “A-” or better or such
issues must be unconditionally guaranteed by a company or entity with a Moody’s,
S&P or Fitch rating of “A-” or better or, in the event of an issue not being
subject to such a guarantee or rating, the equivalent as determined by the
investment manager.

 

National Interstate Insurance retains the final right of approval for all
investment transactions.