Document:

exv10w1w1

 

CONFORMED COPY

FOURTH AMENDING AGREEMENT

	 	   	THIS AGREEMENT dated as of the 29th day of October, 2004.

BETWEEN:

	 	   	VITRAN CORPORATION INC., a corporation incorporated under the laws of
the Province of Ontario
	 
	 	   	(herein called “Vitran”)
	 
	 	  	- and -
	 
	 	   	VITRAN EXPRESS CANADA INC., a corporation continued and amalgamated
under the laws of the Province of Ontario
	 
	 	   	(herein called “Vitran Express”)
	 
	 	  	- and -
	 
	 	   	THE BANK OF NOVA SCOTIA and LAURENTIAN BANK OF CANADA, and one or more
financial institutions to whom either or both of the foregoing or
their respective permitted assigns may from time to time assign an
undivided interest in the Loan Documents and who agree to be bound by
the terms of the Credit Agreement as a Lender
	 
	 	   	(herein collectively called the “Lenders” and individually called a
“Lender”)
	 
	 	  	- and -
	 
	 	   	THE BANK OF NOVA SCOTIA, a Canadian chartered bank, in its capacity as
agent of the Lenders under the Credit Agreement
	 
	 	   	(herein called the “Agent”)

 

 

          WHEREAS Vitran, Vitran Express (as corporate successor to Trans Western Express Inc.), the
Lenders and the Agent entered into an amended and restated credit agreement made as of January 31,
2002, pursuant to which the Lenders established certain term credit facilities in favour of Vitran
and Vitran Express (as amended by amending agreements dated September 3, 2002, January 29, 2003 and
September 26, 2003 and as may be further modified, supplemented, amended or restated, the “Credit
Agreement”);

          AND WHEREAS the parties hereto wish to amend certain provisions of the Credit Agreement;

          NOW THEREFORE THIS AGREEMENT WITNESSES that, in consideration of the mutual covenants and
agreements contained herein, the parties covenant and agree as follows:

ARTICLE 1

DEFINED TERMS

	   	1.1     Capitalized Terms.     All capitalized terms which are used herein without being specifically
defined herein shall have the meaning ascribed thereto in the Credit Agreement as amended hereby.

ARTICLE 2

AMENDMENTS

     2.1     General Rule.     Subject to the terms and conditions herein contained, the Credit Agreement is
hereby amended to the extent necessary to give effect to the provisions of this agreement and to
incorporate the provisions of this agreement into the Credit Agreement.

     2.2     Amendments to Credit Agreement.

	 	(a)  	Section 1.01 of the Credit Agreement is hereby amended by:

	 	(i)  	Deleting the definitions of ““Current Assets” and “Current
Liabilities””, “Excess Cash Flow” and “Working Capital”.
	 
	 	(ii)  	Deleting the reference to “August 31, 2006” in the definition of
“Credit Facility 1 Maturity Date” and replacing it with “September 30, 2007”;
	 
	 	(iii)  	Deleting the definition of “Credit Facility 2 Maturity Date” and
replacing it with the following:
	 
	 	   	“Credit Facility 2 Maturity Date” means September 30, 2007.”
	 
	 	(iv)  	Deleting the definition of “EBITDA” and replacing it with the following:

	 	  	“”EBITDA” means, for any particular period, Net Income (excluding, in the
calculation of Net Income, any dividends other than cash dividends received in the
ordinary course from entities in which such Person has an equity interest which are
not directly or indirectly subsidiaries of such Person provided that such cash
dividend amount shall be limited to a maximum of 10% of the EBITDA calculated only in
respect of any Person) for such period plus, to the extent deducted in determining
Net Income, the aggregate of

 

 

	 	  	(a) Interest Expenses for such period, (b) consolidated income tax expenses of Vitran
for such period, (c) consolidated depletion, depreciation and amortization expenses
and other non-cash expenses of Vitran for such period, and, provided that for
purposes of calculating EBITDA for any period, the EBITDA during such period
attributable to any Acquisition by a Borrower or any Subsidiary during such period
shall be included on a pro forma basis for such period (assuming the consummation of
such Acquisition and the incurrence or assumption of any Debt in connection therewith
occurred on the first day of such period) provided that such Borrower shall have
provided to the Agent and the Lenders, prior to the completion of the Acquisition,
(i) the most recently available consolidated balance sheet of the Person that is the
subject of such Acquisition (and its consolidated Subsidiaries) and (ii) the most
recently available consolidated statements of income and of cash flows and all such
financial statements have been reviewed and reported on by independent accountants or
are otherwise in form and substance acceptable to the Agent.”

	 	(v)  	Deleting the reference to “one year” in the definition of
“Letter” and replace it with “three years”.
	 
	 	(vi)  	Adding the following definitions in alphabetical order:

	 	   	“”Acquisition” means, as to any Person, (i) any purchase or other acquisition of all
of the voting securities of any other Person, and (ii) any purchase or other
acquisition of all or substantially all of the assets of any other Person or of
assets consisting of a line of business of any other Person;
	 
	 	   	“Aggregate Consideration” means, in relation to an Acquisition, the total value of
the consideration paid or liability assumed by the purchaser making such Acquisition
and, for the purposes of Section 11.02(i), less (x) cash on hand of any Person that
is the subject of an Acquisition; (y) the value of equity issued by a purchaser
which is issued as part of the purchase price for such Acquisition; and (z) such
purchaser’s cash on hand immediately prior to the Acquisition which will be used to
pay all or part of the purchase price for such Acquisition.
	 
	 	   	“Business” means the business of the Borrowers and the Subsidiaries, being the
provision of freight and distribution services and ancillary services thereto carried
on by the Borrowers and the Subsidiaries in Canada and the United States.
	 
	 	   	“Environmental Laws” means all Applicable Law relating in full or in part to the
protection of the environment or human health or relating to the manufacture,
processing, management, distribution, use, collection, treatment, storage,
generation, release, spill, leak, pumping, pouring, emitting, adding, emptying,
injection, escape, leaching, throwing, placing, exhausting, dumping, spraying,
burial, abandonment, incineration, seepage, placement, emission, deposit, issuance,
discharge or disposal, transport, transfer or handling of any contaminant, pollutant,
waste of any nature, hazardous or toxic substance or material or dangerous good as
defined, judicially interpreted or identified in any Environmental Law or any
substance that causes or may cause harm or degradation to the environment or injury
to human health and includes any condition, circumstance, pollutant, contaminant,
waste, hazardous waste, deleterious, toxic or hazardous substance or dangerous good
present in such quantity or state that it contravenes any Environmental

 

 

	 	   	Laws or gives rise to any losses, claims, liability or obligation under any
Environmental Law.
	 
	 	   	“Qualified Environmental Consultant” means an environmental consultant which is
qualified and recognized as such in the geographic area in which the related property
is located.”
	 
	 	(b)  	Section 2.01(a) of the Credit Agreement is hereby deleted and replaced by the
following:
	 
	 	   	“a non-revolving term credit facility (“Credit Facility 1”) in the amount of
US$15,000,000 or the Canadian Dollar Equivalent thereof;
	 
	 	(c)  	Section 2.01(b) of the Credit Agreement is hereby deleted and replaced by the
following:
	 
	 	   	“a revolving term credit facility (“Credit Facility 2”) in the amount, from time to
time, equal to the lesser of US$35,000,000 or the Canadian Dollar Equivalent thereof
and the Borrowing Base.”
	 
	 	(d)  	Section 3.01 of the Credit Agreement is hereby amended by deleting the
reference to “$7,500,000” and replacing it with “US$7,500,000 or the Exchange
Equivalent thereof”.
	 
	 	(e)  	Section 9.01 of the Credit Agreement is hereby deleted in its entirety and
replaced by the following:
	 
	 	   	“Repayment under Credit Facility 1. The aggregate credit outstanding under Credit
Facility 1 as of the date hereof shall be repaid by the Borrowers to the Lenders in
the following amounts on the following dates:

	 	 	 	 	 
	Amount	 	Date	 
	US$562,500
	 	December 31, 2004
	US$562,500
	 	March 31, 2005
	US$562,500
	 	June 30, 2005
	US$562,500
	 	September 30, 2005
	US$1,312,500
	 	December 31, 2005
	US$1,312,500
	 	March 31, 2006
	US$1,312,500
	 	June 30, 2006
	US$1,312,500
	 	September 30, 2006
	US$1,875,000
	 	December 31, 2006
	US$1,875,000
	 	March 31, 2007
	US$1,875,000
	 	June 30, 2007
	US$1,875,000
	 	September 30, 2007

	 	   	Amounts which are repaid as aforesaid may not be reborrowed.”
	 
	 	(f)  	Section 9.02 of the Credit Agreement is hereby amended by deleting the words
“Subject to Section 9.03, the” and replacing them with the word “The”.
	 
	 	(g)  	Section 9.03 of the Credit Agreement is hereby deleted in its entirety and
replaced with “[Intentionally Deleted]”.

 

 

	 	(h)  	Section 9.06 of the Credit Agreement is hereby deleted in its entirety and
replaced with “[Intentionally Deleted]”.
	 
	 	(i)  	Section 11.01(b) is hereby deleted in its entirety and replaced by the
following:
	 
	 	   	“Debt to EBITDA Ratio. Vitran shall at all times maintain the Debt to EBITDA
Ratio at:

	 	(i)  	less than or equal to                 for each Fiscal Quarter from and
including the Fiscal Quarter ending December 31, 2004 to and including the
Fiscal Quarter ending December 31, 2005; and
	 
	 	(ii)  	less than or equal to                 for each Fiscal Quarter thereafter.”

	 	(j)  	Section 11.01(d) of the Credit Agreement is hereby deleted in its entirety and
replaced by the following:
	 
	 	   	”Equity. Equity shall at all times exceed the aggregate of:

	 	(i)  	               ; and
	 
	 	(ii)  	the aggregate of                 of positive Net Income for each Fiscal Quarter beginning
December 31, 2004 and for each Fiscal Quarter thereafter which has been completed on
or before the date of determination and, if Net Income for any such period is a
negative amount, it shall be deemed to be equal to zero.”

	 	(k)  	Section 11.01(o) of the Credit Agreement is hereby amended by deleting the
first sentence thereof and replacing it with the following:
	 
	 	   	“The Borrowers will cause any Person becoming a Subsidiary after the date hereof to
(i) execute and deliver counterparts to the Guarantee thereby becoming a Guarantor
thereunder and to (ii) grant to the Agent a security interest in all of its present
and future undertaking and assets.”
	 
	 	(l)  	Section 11.02(e) of the Credit Agreement is hereby amended by adding the
following sentence at the end thereof:
	 
	 	   	“Nothing in this Section 11.02(e) shall prevent either Borrower nor any Subsidiary
from making any Acquisition as permitted by Section 11.02(i).”
	 
	 	(m)  	Section 11.02 of the Credit Agreement is hereby amended by adding the
following as a new Section 11.02(i):
	 
	 	  	“Restrictions On Acquisitions. Neither Borrower nor any Subsidiary shall make any
Acquisition unless no Default or Event of Default has occurred which is continuing
and no such event shall occur as a result of making such Acquisition, and if:

	 	(i)  	the assets or entity being purchased will be used to carry on the
Business in Canada or the United States;
	 
	 	(ii)  	the purchase would not result in a breach of any of the
representations, warranties or covenants contained herein, including financial
covenants on a pro forma basis, after giving effect to such Acquisition, as
evidenced by a certificate which contains financial covenant calculations in
reasonable detail and which has been delivered to the Agent and the Lenders, and
is in a form satisfactory to them acting reasonably;

 

 

	 	(iii)  	during the term of the Credit Facilities, the Aggregate Consideration
of any Acquisition does not exceed                 or the Exchange Equivalent thereof
individually, or                 or the Exchange Equivalent thereof in the aggregate, unless
the prior written consent of the Majority Lenders has been obtained;
	 
	 	(iv)  	for any real property (whether owned or, if the property previously
has been used other than as office space, leased, occupied, managed, used or
controlled) that is the subject of any purchase, lease or other agreement, by
either Borrower or the entity being acquired by such Borrower shall have
delivered to the Agent a recent phase I environmental assessment conducted by a
Qualified Environmental Consultant and a phase II environmental assessment
conducted by a Qualified Environmental Consultant, if so requested by the Agent
upon (i) consultation with the relevant Borrower and (ii) if recommended in the
phase I environmental assessment, together with a plan of remediation,
satisfactory to the Agent acting reasonably, if any remediation required by
Environmental Law is recommended in such assessments;
	 
	 	(v)  	in the case of an Acquisition of shares, the purchase must be
“friendly” (i.e., not hostile) and, for certainty, shall not include an offer to
acquire securities which has not been recommended by the board of directors of
the targeted corporation; and
	 
	 	(vi)  	the target corporation shall comply with Section 11.01(o) if such
target corporation would be a Subsidiary.

	 	   	provided that nothing in this subsection shall restrict either Borrower’s or any
Subsidiary’s ability to make any investment permitted by Section 11.02(e).”
	 
	 	(n)  	Schedules A and B to the Credit Agreement are hereby deleted in their entirety
and replaced by Schedules A and B attached hereto.

ARTICLE 3

MISCELLANEOUS

	   	3.1     Conditions Precedent to Effectiveness.     This agreement shall be effective upon
satisfaction of the following conditions:

	 	(a)  	each of the Guarantors shall have signed the Consent and Confirmation forming
part hereof;
	 
	 	(b)  	no Default shall have occurred and be continuing or would arise upon this
agreement becoming effective;
	 
	 	(c)  	the Agent has received, in form and substance satisfactory to it:

	 	(i)  	a duly certified resolution of the board of directors of each Borrower
authorizing each to execute, deliver and perform its obligations under the
Credit Agreement, as amended hereby;
	 
	 	(ii)  	a certificate of a senior officer of each Borrower setting forth
specimen signatures of the individuals authorized to sign this Agreement;
	 
	 	(iii)  	a duly certified copy of the articles of incorporation or articles of
amalgamation, as the case may be, and by-laws of each Borrower;

 

 

	 	(iv)  	a certificate of status or good standing for each Borrower issued by
the appropriate governmental body or agency;
	 
	 	(v)  	opinions of legal counsel to each Borrower with respect to, inter alia,
the enforceability of the Credit Agreement, as amended hereby, and otherwise in
form and substance satisfactory to the Agent.

	 	(d)  	the Borrowers shall have paid (x) to The Bank of Nova Scotia, as Lender, an
amendment fee of                 and (y) to Laurentian Bank of Canada, as Lender, an amendment fee
of                .

3.2     Future References to the Credit Agreement.     On and after the date of this
agreement, each reference in the Credit Agreement to “this agreement”, “hereunder”, “hereof”, or
words of like import referring to the Credit Agreement, and each reference in any related document
to the “ Credit Agreement”, “thereunder”, “thereof”, or words of like import referring to the
Credit Agreement, shall mean and be a reference to the Credit Agreement as amended hereby. The
Credit Agreement, as amended hereby, is and shall continue to be in full force and effect and is
hereby in all respects ratified and confirmed.

3.3     Governing Law.     This agreement shall be governed by and construed in accordance
with the laws of the Province of Ontario.

3.4     Enurement.     This agreement shall enure to the benefit of and shall be binding upon
the parties hereto and their respective successors and permitted assigns.

3.5     Conflict.     If any provision of this agreement is inconsistent or conflicts with
any provision of the Credit Agreement, the relevant provision of this agreement shall prevail and
be paramount.

3.6     Counterparts.     This agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original and all of which taken together shall be deemed to
constitute one and the same instrument. Executed counterparts shall be delivered to the Agent or
transmitted to the Agent by telefacsimile and the parties adopt signatures so transmitted to the
Agent as original signatures; provided, however, that any party transmitting its signature to the
Agent by telefacsimile shall promptly deliver to the Agent an original of the executed counterpart
of this agreement which was so transmitted.

[The remainder of this page is intentionally left blank.]

 

 

          IN WITNESS WHEREOF the parties hereto have executed and delivered this agreement on the
date first above written.

	 	 	 	 	 
	 	

VITRAN CORPORATION INC.

 	 
	 	By:  	/s/ SEAN P. WASHCHUK
 	 
	 	 	Name:  	Sean P. Washchuk 	 
	 	 	Title:  	Vice President Finance and Chief Financial Officer 	 
	 

	 	 	 	 	 
	 	VITRAN EXPRESS CANADA INC.

 	 
	 	By:  	/s/ SEAN P. WASHCHUK
 	 
	 	 	Name:  	Sean P. Washchuk 	 
	 	 	Title:  	Secretary 	 
	 

	 	 	 	 	 
	 	THE BANK OF NOVA SCOTIA, as Agent

 	 
	 	By:  	/s/ JEAN HOPKINS
 	 
	 	 	Name:  	Jean Hopkins 	 
	 	 	Title:  	Director 	 
	 
	 	 	 
	 	By:  	                       /s/ SANGEETA SHAH
 	 
	 	 	Name:  	Sangeeta Shah 	 
	 	 	Title:  	Associate 	 
	 

	 	 	 	 	 
	 	THE BANK OF NOVA SCOTIA, as Lender

 	 
	 	By:  	/s/ JEAN HOPKINS
 	 
	 	 	Name:  	Jean Hopkins 	 
	 	 	Title:  	Director 	 
	 
	 	 	 
	 	By:  	                       /s/ VERONICA PEREIRA
 	 
	 	 	Name:  	Veronica Pereira 	 
	 	 	Title:  	Senior Manager 	 
	 

	 	 	 	 	 
	 	LAURENTIAN BANK OF CANADA

 	 
	 	By:  	/s/ MICHAEL DIGIROLAMO
 	 
	 	 	Name:  	Michael Digirolamo 	 
	 	 	Title:  	Manager 	 

 

 

Schedule A

Pricing Grid

Applicable Margin

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	Debt to EBITDA Ratio	 	 
	 	Availment
	 	 	 	—	 	 	 	 	—	 	 	 	 	—	 	 
	 	LIBOR Loans and Banker’s
Acceptances
	 	 	 	1.25% p.a.	 	 	 	 	1.75% p.a.	 	 	 	 	2.50% p.a.	 	 
	 	Prime Rate and Base Rate
Loans
	 	 	 	0.25% p.a.	 	 	 	 	0.75% p.a.	 	 	 	 	1.50% p.a.	 	 
	 	Standby Fee
	 	 	 	0.375% p.a.	 	 	 	 	0.400% p.a.	 	 	 	 	0.50% p.a.	 	 
	 	Letter Fee
	 	 	 	1.125% p.a.	 	 	 	 	1.625% p.a.	 	 	 	 	2.375% p.a.	 	 
	 

 

 

Schedule B

Individual Commitments

	 	 	 	 	 	 	 	 	 
	Name of Lender	 	Individual Commitment	 
	 	 	Credit Facility 1	 	 	Credit Facility 2	 
	The Bank of Nova Scotia
	 	US$	10,065,000	 	 	US$	26,709,884	 
	Laurentian Bank of Canada
	 	US$	4,935,000	 	 	US$	8,290,116exv10w31

 

EXHIBIT 10.31

NORTEL NETWORKS LIMITED

MEETING OF THE BOARD OF DIRECTORS

DECEMBER 18, 2003

* * * EXTRACT * * *

Remuneration of Chairman of the Board

     RESOLVED, That the annual compensation to be paid to Mr. L.R. Wilson for his services
as Chairman of the Board of the Corporation and Nortel Networks Corporation (“NNC”) shall be
increased from US$360,000 per year to US$400,000 per year, effective January 1, 2004;

Directors’ Remuneration

     RESOLVED, That, effective January 1, 2004, each Director of the Corporation who is not
a salaried employee of the Corporation, NNC, or any of its or their subsidiaries (each a “Nortel
Networks Company”), shall receive an annual Board retainer of US$60,000;

     RESOLVED, That, effective January 1, 2004, each member of a Board Committee who is not
a salaried employee of a Nortel Networks Company, shall be paid remuneration for services, as a
member of each Board Committee on which the member sits a retainer fee at the rate of US$12,500 per
annum; except that a retainer fee at the rate of US$6,250 per annum shall be paid to any member of
a Board Committee who is also a member of an identical committee of the NNC Board of Directors;

     RESOLVED, That, effective January 1, 2004, any Chairman of a Board Committee (other
than the Audit Committee Chairman), who is not a salaried employee of a Nortel Networks Company,
shall be paid, in addition to the member’s retainer, a retainer fee at the rate of US$12,500 per
annum, except that an additional retainer fee at the rate of US$6,250 per annum shall be paid to
any Chairman of a Board Committee (other than the Audit Committee Chairman) who is also Chairman of
an identical committee of the NNC Board of Directors;

     RESOLVED, That, effective January 1, 2004, the Chairman of the Audit Committee of the
Board of Directors shall be paid, in addition to the member’s retainer, a retainer fee at the rate
of US$27,500 per annum, except that an additional retainer fee of US$13,750 per annum shall be paid
to the Chairman of the Audit Committee if he or she is also chairman of the Audit Committee of the
NNC Board of Directors;

     RESOLVED, That the Directors entitled to the remuneration provided for in the
preceding resolutions shall be reimbursed for the reasonable travel and living and

 

 

other expenses properly incurred by them in attending any meeting of the Board of Directors or its
Committees, or for performing services as Directors;

     RESOLVED, That the remuneration provided for in these resolutions shall be paid
quarterly, in arrears, in United States dollars or, at the request of a Director, in the Canadian
dollar equivalent thereof;

     RESOLVED, That, for greater certainty, Directors shall not be paid an additional fee
for attendance at Board of Directors or Committee meetings;

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