Exhibit 10.17


 


Execution Copy


 


SEVENTH AMENDMENT TO
CREDIT AGREEMENT


 


This SEVENTH AMENDMENT TO CREDIT AGREEMENT (this
“Amendment”), made and entered into as of March 29, 2003, is by and between
Marten Transport, Ltd., a Delaware corporation (the “Borrower”), the banks
which are signatories to the Credit Agreement described below (the “Banks”) and
U.S. Bank National Association, a national banking association, as agent for
the Banks (in such capacity, the “Agent”).


 


RECITALS


 


1.             The
Agent, the Banks and the Borrower entered into a Credit Agreement dated as of
October 30, 1998 as amended by a First Amendment dated as of January 3, 2000, a
Second Amendment dated as of January 19, 2000, a Third Amendment dated as of
April 5, 2000, a Fourth Amendment dated as of May 31, 2000, a Fifth Amendment
dated as of December 6, 2000 and a Sixth Amendment dated as of January 14, 2002
(as amended, restated or otherwise modified from time to time, the “Credit
Agreement”); and


 


2.             The
Borrower desires to amend certain provisions of the Credit Agreement, and the
Agent and the Banks have agreed to make such amendments, subject to the terms
and conditions set forth in this Amendment.


 


AGREEMENT


 


NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto hereby covenant
and agree to be bound as follows:


 


Section 1.         Capitalized Terms.  Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to them in the Credit
Agreement, unless the context shall otherwise require.


 


Section 2.         Amendments.  The Credit Agreement is hereby amended as
follows:


 


2.1          Definitions.


 


(a)           Section
1.1 of the Credit Agreement is amended by adding the definitions of “Applicable
Commitment Fee Percentage”, “Applicable Letter of Credit Fee Percentage”,
“Fixed Charge Coverage Ratio” and “Third Fee Letter” in the
correct alphabetical order to read as follows:


 


“Applicable Commitment Fee Percentage”:  Subject to the last sentence of this
definition, with respect to the period beginning five days after the financial
statements and compliance certificate required by Sections 5.1(c) and (d) are
delivered with respect to any fiscal quarter and ending on the day five days
after the date such financial statements and compliance certificate for the
next fiscal


 

















 


quarter are actually
delivered, the percentage specified as the Applicable Commitment Fee Percentage
based on the Cash Flow Leverage Ratio calculated as of the end of the fiscal
quarter for which such statements were delivered:


 


	
  Cash Flow
  Leverage

  Ratio

  	
   

  	
  Applicable Commitment 

  Fee Percentage

  	
   

  
	
  >1.75

  	
   

  	
  0.375

  	
  %

  
	
  <1.75

  	
   

  	
  0.250

  	
  %

  



 


During
the period beginning on the date five days after the financial statements and
compliance certificate for a fiscal quarter are required to be delivered
pursuant to Sections 5.1(c) and (d) but are not delivered and ending five days
after the date such financial statements are delivered, the Applicable
Commitment Fee Percentage shall be as specified for a Cash Flow Leverage Ratio
greater than 1.75.


 


“Applicable Letter of Credit Fee Percentage”:  Subject to the last sentence of this
definition, with respect to the period beginning five days after the financial
statements and compliance certificate required by Sections 5.1(c) and (d) are
delivered with respect to any fiscal quarter and ending on the day five days
after the date such financial statements and compliance certificate for the
next fiscal quarter are actually delivered, the percentage specified as the
Applicable Letter of Credit Fee Percentage based on the Cash Flow Leverage
Ratio calculated as of the end of the fiscal quarter for which such statements
were delivered:


 


	
  Cash Flow
  Leverage

  Ratio

  	
   

  	
  Applicable Letter of 

  Credit Fee Percentage

  	
   

  
	
  > 2.25

  	
   

  	
  2.25

  	
  %

  
	
  >2.00 and <2.25

  	
   

  	
  2.00

  	
  %

  
	
  >1.75 and <2.00

  	
   

  	
  1.75

  	
  %

  
	
  >1.50 and <1.75

  	
   

  	
  1.50

  	
  %

  
	
  >1.25 and <1.50

  	
   

  	
  1.25

  	
  %

  
	
  <1.25

  	
   

  	
  1.00

  	
  %

  



 


During
the period beginning on the date five days after the financial statements and
compliance certificate for a fiscal quarter are required to be delivered pursuant
to Sections 5.1(c) and (d) but are not delivered and ending five days after the
date such financial statements are delivered, the Applicable Letter of Credit
Fee Percentage shall be as specified for a Cash Flow Leverage Ratio greater
than 2.25.


 


2

















 


“Fixed Charge Coverage Ratio”:  For any period of determination, the ratio
of


 


(a)           EBITDAR
minus the sum of (i) any Restricted Payments, (ii) 25% of Capital Expenditures
(net of value received for trade-ins), and (iii) tax expenses of the Borrower
and the Subsidiaries paid in cash,


 


to


 


(b)           the sum of
(i) Interest Expense, (ii) transportation equipment operating lease expense and
(iii) an amount equal to one-sixth of Total Liabilities bearing interest,


 


in each case determined for said period on a consolidated
basis in accordance with GAAP.


 


“Third
Fee Letter”:  The confidential
letter, dated as of March 29, 2003, from the Agent to the Borrower.


 


(b)           The
definitions of “Applicable Margin”, “Cash Flow Leverage Ratio”
and “Required Banks” contained in Section 1.1 of the Credit Agreement is
amended in their entireties to read as follows:


 


“Applicable Margin”: Subject to the last
sentence of this definition, with respect to the period beginning five days
after the financial statements and compliance certificate required by Sections
5.1(c) and (d) are delivered with respect to any fiscal quarter and ending on
the day five days after the date such financial statements and compliance
certificate for the next fiscal quarter are actually delivered, the percentage
specified as applicable to Prime Rate Advances or Eurodollar Rate Advances,
based on the Cash Flow Leverage Ratio calculated as of the end of the fiscal
quarter for which such financial statements were delivered:


 


	
  Cash Flow

  Leverage Ratio

  	
   

  	
  Eurodollar

  Rate

  Advances

  	
   

  	
  Prime

  Rate

  Advances

  	
   

  
	
  > 2.25

  	
   

  	
  2.25

  	
  %

  	
  1.25

  	
  %

  
	
  >2.00 and <2.25

  	
   

  	
  2.00

  	
  %

  	
  1.00

  	
  %

  
	
  >1.75 and <2.00

  	
   

  	
  1.75

  	
  %

  	
  0.75

  	
  %

  
	
  >1.50 and <1.75

  	
   

  	
  1.50

  	
  %

  	
  0.50

  	
  %

  
	
  >1.25 and <1.50

  	
   

  	
  1.25

  	
  %

  	
  0.25

  	
  %

  
	
  <1.25

  	
   

  	
  1.00

  	
  %

  	
  0.00

  	
  %

  



 


3

















 


During the period beginning on the date five days after the financial
statements and compliance certificate for a fiscal quarter are required to be
delivered pursuant to Sections 5.1(c) and (d) but are not delivered and ending
five days after the date such financial statements are delivered, the
Applicable Margin shall be as specified for a Cash Flow Leverage Ratio greater
than 2.25.


 


“Cash Flow Leverage Ratio”:  For any period of determination, the ratio of


 


(a)           the sum
(without duplication) of (i) the aggregate principal amount of all outstanding
Capitalized Lease Obligations of the Borrower and the Subsidiaries, (ii) that
portion of Total Liabilities bearing interest determined as of the last day of
that period, (iii) the stated amount of all Letters of Credit as of the last
day of that period, plus (iv) an amount equal to six times transportation
equipment operating lease expense for such period,


 


to


 


(b)           EBITDAR
determined for said period on a consolidated basis in accordance with GAAP.


 


“Required Banks”: At any time, Banks holding 100% of
the aggregate unpaid principal amount of the Revolving Notes or, if no
Revolving Loans are at the time outstanding hereunder, Banks holding 100%% of
the Aggregate Revolving Commitment Amounts.


 


2.2          Interest. 
Section 2.5 of the Credit Agreement is amended in its entirety to read
as follows:


 


2.5(b)      Subject
to paragraph (c) below, each Prime Rate Advance shall bear interest on the
unpaid principal amount thereof at a varying rate per annum equal to the sum of
(i) the Prime Rate, plus (ii) the Applicable Margin.


 


2.3          Revolving Commitment Fee. 
Section 2.15 of the Credit Agreement is amended in its entirety to read
as follows:


 


Section 2.15           Revolving
Commitment Fee.  The Borrower shall
pay to the Agent for the account of each Bank fees (the “Revolving Commitment
Fees”) in an amount determined by applying the Applicable Commitment Fee
Percentage to the average daily Unused Revolving Commitment of such Bank for
the period from the Closing Date to the Termination Date.  Such Revolving Commitment Fees are payable
in arrears monthly on the last day of each fiscal quarter and on the
Termination Date.


 


4

















 


2.4          Letter of Credit and Administrative Fee. 
Section 2.16 of the Credit Agreement is amended in its entirety to read
as follows:


 


Section 2.16           Letter
of Credit Fees and Administrative Fees. 
For each Letter of Credit issued, the Borrower shall pay to the Agent
for the account of the Banks, in advance payable on the date of issuance, a fee
(a “Letter of Credit Fee”) in an amount determined by applying the Applicable
Letter of Credit Fee Percentage to the original face amount of the Letter of
Credit for the period from the date of issuance to the scheduled expiration
date of such Letter of Credit.  In
addition to the Letter of Credit Fee, the Borrower shall pay to the Agent, on
demand, all issuance, amendment, drawing and other fees regularly charged by
the Agent to its letter of credit customers and all out-of-pocket expenses
incurred by the Agent in connection with the issuance, amendment,
administration or payment of any Letter of Credit, and a fronting fee for each
Letter of Credit issued equal to 10 basis points of the stated amount of the
Letter of Credit as of the date of issuance.


 


2.5          Revolving Commitment Ending Date. 
Section 2.19 of the Credit Agreement is amended in its entirety to read
as follows:


 


Section 2.19           Revolving
Commitment Ending Date.  The
“Revolving Commitment Ending Date” is April 1, 2006.


 


2.6          Compliance Certificates. 
Section 5.1(d) of the Credit Agreement is amended in its entirety to
read as follows:


 


5.1(d)      As
soon as practicable and in any event within (a) 45 days after the end of each
of the first three fiscal quarters of each fiscal year and (b) 90 days after
the end of the last fiscal quarter of each fiscal year, a Compliance
Certificate in the form attached hereto as Exhibit 5.1(d) signed by the
chief financial officer of the Borrower demonstrating in reasonable detail
compliance (or noncompliance, as the case may be) with Sections 6.16, 6.17 and
6.18, as at the end of such quarter and stating that as at the end of such
quarter there did not exist any Default or Event of Default or, if such Default
or Event of Default existed, specifying the nature and period of existence
thereof and what action the Borrower proposes to take with respect thereto.


 


2.7          Tangible Net Worth. 
Section 6.16 of the Credit Agreement is amended in its entirety to read
as follows:


 


Section 6.16           Tangible
Net Worth.  The Borrower will not
permit its Tangible Net Worth to be less than $75,000,000 at any time during
the fiscal quarter ending December 31, 2002, which $75,000,000 shall be
cumulatively increased at the beginning of each fiscal quarter thereafter by an
amount equal to 75% of the consolidated net income of the Borrower (if a
positive number) as


 


5

















 


shown
on its income statement for the immediately preceding fiscal quarter. (No
adjustments shall be made for net losses.)


 


2.8          Fixed Charge Coverage Ratio. 
Section 6.17 of the Credit Agreement is amended in its entirety to read
as follows:


 


Section 6.17           Fixed
Charge Coverage Ratio.  The Borrower
will not permit the Fixed Charge Coverage Ratio, as of the last day of any
fiscal quarter, for the four consecutive fiscal quarters ending on that date to
be less than 1.75 to 1.0.


 


2.9          Cash Flow Leverage Ratio. 
Section 6.18 of the Credit Agreement is amended in its entirety to read
as follows:


 


Section 6.18           Cash
Flow Leverage Ratio.  The Borrower
will not permit the Cash Flow Leverage Ratio, as of the last day of any fiscal
quarter, for the four consecutive fiscal quarters ending on that date to be
greater than 2.50 to 1.0.


 


2.10        Schedule I.  Schedule I to the Credit Agreement is hereby
amended in its entirety to read as set forth in Schedule I attached to this
Amendment, which is made a part of the Credit Agreement as Schedule I thereto.


 


Section 3.         Effectiveness of Amendments.  The amendments contained in this Amendment
shall become effective upon delivery by the Borrower of, and compliance by the
Borrower with, the following:


 


3.1          This Amendment duly executed by the
Borrower.


 


3.2          A copy of the resolutions of the
Board of Directors of the Borrower authorizing the execution, delivery and
performance of this Amendment certified as true and accurate by its Secretary
or Assistant Secretary, along with a certification by such Secretary or
Assistant Secretary (i) certifying that there has been no amendment to the
Certificate of Incorporation or Bylaws of the Borrower since true and accurate
copies of the same were delivered to the Agent with a certificate of the
Secretary of the Borrower dated October 30, 1998, and (ii) identifying each
officer of the Borrower authorized to execute this Amendment and any other
instrument or agreement executed by the Borrower in connection with this
Amendment  (collectively, the “Amendment
Documents”), and certifying as to specimens of such officer’s signature and
such  officer’s incumbency in such
offices as such officer holds.


 


3.3          A copy of the Third Fee Letter,
dated as of the date hereof, duly executed by the Borrower.


 


3.4          Certified copies of all documents
evidencing any necessary corporate action, consent or governmental or
regulatory approval (if any) with respect to this Amendment.


 


6

















 


3.5          The Borrower shall have satisfied
such other conditions as specified by the Agent and the Banks, including
payment of all unpaid legal fees and expenses incurred by the Agent through the
date of this Amendment in connection with the Credit Agreement and the
Amendment Documents.


 


Section 4.         Representations,
Warranties, Authority, No Adverse Claim.


 


4.1          Reassertion
of Representations and Warranties, No Default.  The
Borrower hereby represents that on and as of the date hereof and after giving
effect to this Amendment (a) all of the representations and warranties
contained in the Credit Agreement are true, correct and complete in all respects
as of the date hereof as though made on and as of such date, except for changes
permitted by the terms of the Credit Agreement, and (b) there will exist no
Default or Event of Default under the Credit Agreement as amended by this
Amendment on such date which has not been waived by the Banks.


 


4.2          Authority,
No Conflict, No Consent Required. The Borrower represents and warrants that the Borrower
has the power and legal right and authority to enter into the Amendment
Documents and has duly authorized as appropriate the execution and delivery of
the Amendment Documents and other agreements and documents executed and
delivered by the Borrower in connection herewith or therewith by proper
corporate action, and none of the Amendment Documents nor the agreements
contained herein or therein contravenes or constitutes a default under any
agreement, instrument or indenture to which the Borrower is a party or a
signatory or a provision of the Borrower’s Certificate of Incorporation, Bylaws
or any other agreement or requirement of law, or result in the imposition of
any Lien on any of its property under any agreement binding on or applicable to
the Borrower or any of its property except, if any, in favor of the Agent.  The Borrower represents and warrants that no
consent, approval or authorization of or registration or declaration with any
Person, including but not limited to any governmental authority, is required in
connection with the execution and delivery by the Borrower of the Amendment
Documents or other agreements and documents executed and delivered by the
Borrower in connection therewith or the performance of obligations of the
Borrower therein described, except for those which the Borrower has obtained or
provided and as to which the Borrower has delivered certified copies of
documents evidencing each such action to the Agent.


 


4.3          No
Adverse Claim. The
Borrower warrants, acknowledges and agrees that no events have been taken place
and no circumstances exist at the date hereof which would give the Borrower a
basis to assert a defense, offset or counterclaim to any claim of the Agent or
the Banks with respect to the Obligations.


 


Section 5.         Affirmation of Credit Agreement, Further References.  The Agent, the Banks and the Borrower each
acknowledge and affirm that the Credit Agreement, as hereby amended, is hereby
ratified and confirmed in all respects and all terms, conditions and provisions
of the Credit Agreement, except as amended by this Amendment, shall remain


 


7

















 


unmodified and in full
force and effect.  All references in any
document or instrument to the Credit Agreement are hereby amended and shall
refer to the Credit Agreement as amended by this Amendment.   All of the terms, conditions, provisions,
agreements, requirements, promises, obligations, duties, covenants and
representations of the Borrower under such documents and any and all other
documents and agreements entered into with respect to the obligations under the
Credit Agreement are incorporated herein by reference and are hereby ratified
and affirmed in all respects by the Borrower.


 


Section 6.         Merger and Integration, Superseding Effect.  This Amendment, from and after the date
hereof, embodies the entire agreement and understanding between the parties
hereto and supersedes and has merged into this Amendment all prior oral and
written agreements on the same subjects by and between the parties hereto with
the effect that this Amendment, shall control with respect to the specific
subjects hereof and thereof.


 


Section 7.         Severability.  Whenever possible, each provision of this
Amendment and the other Amendment Documents and any other statement, instrument
or transaction contemplated hereby or thereby or relating hereto or thereto
shall be interpreted in such manner as to be effective, valid and enforceable
under the applicable law of any jurisdiction, but, if any provision of this
Amendment, the other Amendment Documents or any other statement, instrument or
transaction contemplated hereby or thereby or relating hereto or thereto shall
be held to be prohibited, invalid or unenforceable under the applicable law,
such provision shall be ineffective in such jurisdiction only to the extent of
such prohibition, invalidity or unenforceability, without invalidating or
rendering unenforceable the remainder of such provision or the remaining
provisions of this Amendment, the other Amendment Documents or any other
statement, instrument or transaction contemplated hereby or thereby or relating
hereto or thereto in such jurisdiction, or affecting the effectiveness,
validity or enforceability of such provision in any other jurisdiction.


 


Section 8.         Successors.  The
Amendment Documents shall be binding upon the Borrower, the Agent and the Banks
and their respective successors and assigns, and shall inure to the benefit of
the Borrower, the Agent and the Banks and the successors and assigns of the
Agent and the Banks.


 


Section 9.         Legal Expenses.  As provided in Section 9.2 of the Credit
Agreement, the Borrower agrees to reimburse the Agent and the Banks, upon
execution of this Amendment, for all reasonable out-of-pocket expenses
(including attorney’ fees and legal expenses of Dorsey & Whitney LLP,
counsel for the Agent) incurred in connection with the Credit Agreement, including
in connection with the negotiation, preparation and execution of the Amendment
Documents and all other documents negotiated, prepared and executed in
connection with the Amendment Documents, and in enforcing the obligations of
the Borrower under the Amendment Documents, and to pay and save the Agent and
the Banks harmless from all liability for, any stamp or other taxes which may
be payable with respect to the execution or delivery of the Amendment
Documents, which obligations of the Borrower shall survive any termination of
the Credit Agreement.


 


8

















 


Section 10.       Headings.  The headings of various sections of this Amendment have been
inserted for reference only and shall not be deemed to be a part of this Amendment.


 


Section 11.       Counterparts.  The Amendment Documents may be executed in
several counterparts as deemed necessary or convenient, each of which, when so
executed, shall be deemed an original, provided that all such counterparts
shall be regarded as one and the same document, and either party to the
Amendment Documents may execute any such agreement by executing a counterpart
of such agreement.


 


Section
12.       Governing Law.  THE AMENDMENT DOCUMENTS SHALL BE GOVERNED BY
THE INTERNAL LAWS OF THE STATE OF MINNESOTA, WITHOUT GIVING EFFECT TO CONFLICT
OF LAW PRINCIPLES THEREOF, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO
NATIONAL BANKS, THEIR HOLDING COMPANIES AND THEIR AFFILIATES.


 


[THE REMAINDER OF THIS
PAGE LEFT BLANK INTENTIONALLY.]


 


9

















 


IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed as of the date and year first above written.


 


	
  BORROWER:

  	
   

  
	
   

  	
  MARTEN TRANSPORT, LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:  

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title: 

  	
   

  	
   

  
	
   

  	
   

  
	
  Revolving Commitment Amount:

  $35,000,000

  	
  U.S. BANK NATIONAL
  ASSOCIATION,

  In its individual corporate capacity and as Agent

  
	
   

  	
   

  
	
   

  	
  By:  

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title: 

  	
   

  	
   

  
	
   

  	
   

  
	
  Revolving Commitment
  Amount:

  	
  THE NORTHERN TRUST
  COMPANY

  
	
  $10,000,000

  	
   

  
	
   

  	
   

  
	
   

  	
  By:  

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title: 

  	
   

  	
   

  
					



 


[Signature Page to Seventh
Amendment to Credit Agreement]


 


S - 1

















 


SCHEDULE I

TO THE CREDIT AGREEMENT


 


	
  NAME AND

  NOTICE ADDRESS OF BANK

  	
   

  	
  REVOLVING
  COMMITMENT
AMOUNT

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  U.S.
  Bank National Association

  	
   

  	
  $

  	
  35,000,000

  	
   

  
	
  BC-MN-H03P

  	
   

  	
   

  	
   

  
	
  800 Nicollet
  Mall

  	
   

  	
   

  	
   

  
	
  Minneapolis, MN
  55402

  	
   

  	
   

  	
   

  
	
  ATTN: Michael J.
  Reymann

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The
  Northern Trust Company

  	
   

  	
  $

  	
  10,000,000

  	
   

  
	
  50
  South LaSalle Street

  	
   

  	
   

  	
   

  
	
  Chicago,
  IL 60675

  	
   

  	
   

  	
   

  
	
  ATTN:
  John Canty