Document:

10.11 - At Will Employment Confidential Info Noncompete Agreement Mallard

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ACORN ENERGY, INC.
AT-WILL EMPLOYMENT, CONFIDENTIAL INFORMATION, 
NON-COMPETITION AND INVENTION ASSIGNMENT AGREEMENT
In consideration of, and as a condition of, my employment with Acorn Energy, Inc. (“Acorn”) and in further consideration of my receipt of the compensation now and hereafter paid to me by the Company (as hereinafter defined), I agree as follows.  Acorn and its direct and indirect subsidiaries and entities in which Acorn directly or indirectly holds a significant ownership interest, whether currently owned or hereafter formed or acquired, are hereinafter collectively and together with their respective subsidiaries, affiliates, successors or assigns referred to as the “Company.”  
1.At-Will Employment.
I UNDERSTAND AND ACKNOWLEDGE THAT MY EMPLOYMENT WITH THE COMPANY IS FOR AN UNSPECIFIED DURATION AND CONSTITUTES “AT-WILL” EMPLOYMENT.  I ALSO UNDERSTAND THAT ANY REPRESENTATION TO THE CONTRARY IS UNAUTHORIZED AND NOT VALID UNLESS IN WRITING AND SIGNED BY THE CHIEF EXECUTIVE OFFICER OF ACORN.  ACCORDINGLY, I ACKNOWLEDGE THAT MY EMPLOYMENT RELATIONSHIP MAY BE TERMINATED AT ANY TIME, WITH OR WITHOUT GOOD CAUSE OR FOR ANY OR NO CAUSE, AT MY OPTION OR AT THE OPTION OF THE COMPANY, WITH OR WITHOUT NOTICE, UNLESS I HAVE AN EXISTING AGREEMENT WITH THE COMPANY REGARDING NOTICE, AND IF SO THE NOTICE PROVISION IN SUCH AGREEMENT SHALL CONTROL.
2.Confidential Information.
A.Company Information. I agree at all times during my employment with the Company and thereafter, to hold in the strictest confidence, and not to use, except for the benefit of the Company, or to disclose to any person, firm, or corporation without written authorization of the Board of Directors of Acorn, any Company Confidential Information (as hereinafter defined).  I understand that my unauthorized use or disclosure of Company Confidential Information during my employment may lead to disciplinary action, up to and including immediate termination and legal action by the Company.  I understand that “Company Confidential Information” means any non-public information that relates to the actual or anticipated business, research, or development of the Company, or to the Company's technical data, trade secrets, or know-how, including, but not limited to formulas, research, product plans, or other information regarding the Company's products or services and markets therefor, customer lists and customers (including, but not limited to, customers of the Company on which I called or with which I may become acquainted during the term of my employment), software, developments, inventions, processes, formulas, technology, designs, drawings, engineering, hardware configuration information, marketing, finances and other business information; provided, however Company Confidential Information does not include any of the foregoing items to the extent the same have become publicly known and made generally available through no wrongful act of mine or of others.
B.Former Employer Information. I agree that during my employment with the Company, I will not improperly use, disclose, or induce the Company to use any proprietary information or trade secrets of any former or concurrent employer or other person or entity.  I further agree that I will not bring onto the 

premises of the Company or transfer onto the Company's technology systems any unpublished document, proprietary information, or trade secrets belonging to any such employer, person, or entity unless consented to in writing by both Company and such employer, person, or entity.
C.Third Party Information. I recognize that the Company may have received and in the future may receive from third parties associated with the Company, e.g., the Company's customers, suppliers, licensors, licensees, partners, or collaborators (“Associated Third Parties”) their confidential or proprietary information (“Associated Third Party Confidential Information”).  By way of example, Associated Third Party Confidential Information may include the habits or practices of Associated Third Parties, the technology of Associated Third Parties, requirements of Associated Third Parties, and information related to the business conducted between the Company and such Associated Third Parties.  I agree at all times during my employment with the Company and thereafter, to hold in the strictest confidence, and not to use or to disclose to any person, firm, or corporation any Associated Third Party Confidential Information, except as necessary in carrying out my work for the Company consistent with the Company's agreement with such Associated Third Parties.  I understand that my unauthorized use or disclosure of Associated Third Party Confidential Information during my employment will lead to disciplinary action, up to and including immediate termination and legal action by the Company.
3.Inventions.
A.Inventions Retained and Licensed.  I have attached hereto as Exhibit A, a list describing all inventions, discoveries, original works of authorship, developments, improvements, and trade secrets, which were conceived in whole or in part by me prior to my employment with the Company to which I have any right, title or interest and which relate to the Company's proposed business, products, or research and development (“Prior Inventions”); or, if no such list is attached, I represent and warrant that there are no such Prior Inventions.  Furthermore, I represent and warrant that the inclusion of any Prior Inventions from Exhibit A of this At-Will Employment, Confidential Information, Non-Competition and Invention Assignment Agreement (the “Agreement”) will not materially affect my ability to perform all obligations under this Agreement.  If, in the course of my employment with the Company, I incorporate into or use in connection with any product, process, service, technology, or other work by or on behalf of the Company any Prior Invention, I hereby grant to the Company a nonexclusive, royalty-free, fully paid-up, irrevocable, perpetual, worldwide license, with the right to grant and authorize sublicenses, to make, have made, modify, use, import, offer for sale, and sell such Prior Invention as part of or in connection with such product, process, service, technology, or other work and to practice any method related thereto.
B.Assignment of Inventions. I agree that I will promptly make full written disclosure to the Company, will hold in trust for the sole right and benefit of the Company, and hereby assign to the Company, or its designee, all my right, title, and interest in and to any and all inventions, original works of authorship, developments, concepts, improvements, designs, discoveries, ideas, trademarks, or trade secrets, whether or not patentable or registrable under patent, copyright, or similar laws, which I may solely or jointly conceive or develop or reduce to practice, or cause to be conceived or developed or reduced to practice, during the period of time I am in the employ of the Company (including during my off-duty hours), or with the use of Company's equipment, supplies, facilities, or the Company Confidential Information (collectively referred to as “Inventions”).  I further acknowledge that all original works of authorship which are made by me (solely or jointly with others) within the scope of and during the period of my employment with the Company and which are protectable by copyright are “works made for hire,” as that term is defined in the United States Copyright Act.  I understand and agree that the decision whether or not to commercialize or market any Inventions is within the Company's sole discretion and for the Company's sole benefit and that no royalty or other consideration will be due to me as a result of the Company's efforts to commercialize or market any such Inventions.
C.Maintenance of Records. I agree to keep and maintain adequate, current, accurate, and authentic written records of all Inventions made by me (solely or jointly with others) during the term of my employment with the Company.  The records will be in the form of notes, sketches, drawings, electronic 

files, reports, or any other format that may be specified by the Company.  The records are and will be available to and remain the sole property of the Company at all times.
D.Patent and Copyright Registrations. I agree to assist the Company, or its designee, at the Company's expense, in every proper way to secure the Company's rights in the Inventions and any rights relating thereto in any and all countries, including the disclosure to the Company of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, assignments and all other instruments which the Company shall deem proper or necessary in order to apply for, register, obtain, maintain, defend, and enforce such rights and in order to assign and convey to the Company, its successors, assigns, and nominees the sole and exclusive rights, title and interest in and to such Inventions and any rights relating thereto, and testifying in a suit or other proceeding relating to such Inventions and any rights relating thereto.  I further agree that my obligation to execute or cause to be executed, when it is in my power to do so, any such instrument or papers shall continue after the termination of this Agreement.  If the Company is unable because of my mental or physical incapacity or for any other reason to secure my signature with respect to any Inventions including, without limitation, to apply for or to pursue any application for any United States or foreign patents or copyright registrations covering such Inventions, then I hereby irrevocably designate and appoint the Company and its duly authorized officers and agents as my agent and attorney in fact, to act for and in my behalf and stead to execute and file any papers, oaths and to do all other lawfully permitted acts with respect to such Inventions with the same legal force and effect as if executed by me.
4.Conflicting Employment.  I represent that I have no other agreements, relationships, or commitments to any other person or entity that conflict with my obligations to the Company under this Agreement or my ability to become employed and perform the services for which I am being hired by the Company.  I further agree that if I have signed a confidentiality agreement or similar type of agreement with any former employer or other entity, I will comply with the terms of any such agreement to the extent that its terms are lawful under applicable law.  I represent and warrant that after undertaking a careful search (including searches of my computers, cell phones, electronic devices and documents), I have returned all property and confidential information belonging to all prior employers.  Moreover, I agree to fully indemnify the Company, its directors, officers, agents, employees, investors, shareholders, administrators, affiliates, divisions, subsidiaries, predecessor and successor corporations, and assigns for all verdicts, judgments, settlements, and other losses incurred by any of them resulting from my breach of my obligations under any agreement to which I am a party or obligation to which I am bound, as well as any reasonable attorneys' fees and costs if the plaintiff is the prevailing party in such an action.
5.Returning Company Documents. Upon separation from employment with the Company or on demand by the Company during my employment, I will immediately deliver to the Company, and will not keep in my possession, recreate or deliver to anyone else, any and all Company property, including, but not limited to, Company Confidential Information, Associated Third Party Confidential Information, as well as all devices and equipment belonging to the Company (including computers, handheld electronic devices, telephone equipment, and other electronic devices), Company credit cards, records, data, notes, notebooks, reports, files, proposals, lists, correspondence, specifications, drawings blueprints, sketches, materials, photographs, charts, all documents and property, and reproductions of any of the aforementioned items that were developed by me pursuant to my employment with the Company, obtained by me in connection with my employment with the Company, or otherwise belonging to the Company, its successors, or assigns, including, without limitation, those records maintained pursuant to Section 3.C.  I also consent to an exit interview to confirm my compliance with this Section 5.
6.Non-Competition and Non-Solicitation.
(a)Employee's Covenants.  In consideration of the Company hiring me contemporaneously with my execution of this Agreement, I hereby agree that during the Non-Competition Period (as defined below), I shall not in the Non-Competition Territory (as defined below), through an entity of which I am a partner, shareholder, officer, director, employee, manager, associate, agent, consultant, or owner, (i) solicit Business (as defined below) from any Customer (as defined below) of the Company or any 

Customer with which I have had material contact during the term of my employment, (ii) employ or recruit for employment, or cause the inducement of same, on my own behalf or for any company engaged in the Business, any person employed by the Company as of the date of the termination of my employment, (iii) serve in the Business in a capacity identical to or similar to that capacity in which I worked at the Company or (iv) serve in the Business in a management level position with any company which is a competitor of the Company.  
“Business” shall mean:
(i)The business of Acorn's US Seismic Systems Inc. subsidiary including, but not limited to, providing fiber optic sensing solutions to the security and energy markets;
(ii)The business of Acorn's DSIT subsidiary including, but not limited to, providing sonar and acoustic related solutions for energy, defense and commercial markets with a focus on underwater site security for strategic energy installations and other related real-time and embedded hardware and software development and production;
(iii)The business of Acorn's GridSense subsidiary including, but not limited to, providing remote monitoring and control systems to electric utilities and industrial facilities worldwide; and
(iv)Any other businesses engaged in by the Company including, but not limited to, activities, products, services or lines of business acquired, developed by or engaged in by the Company's direct and indirect subsidiaries or any of their affiliates on or after the date hereof and at any time during the employment of Employee.
“Customer” shall mean any person or entity that purchased any goods or services from the Company during the twelve months immediately preceding the date of termination of my employment.  
The “Non-Competition Period” shall mean a period of six months following the termination, for any reason, of my employment.  
		
	(i)
	“Non-Competition Territory” means the United States of America.

Notwithstanding the foregoing, I may, without violating this Section 6, own, as a passive investment, shares of capital stock of a publicly-held corporation that engages in the Business where the number of shares, options or warrants of such corporation's capital stock that are owned by me represent less than five percent of the total number of shares of such corporation's capital stock outstanding.  Further, if I notify the CEO or the Board of Acorn in writing about potential employment that may be construed as in the Business, the CEO or Board of Acorn shall consider in good faith whether such potential employment may be construed as in the Business and shall notify me of its determination in writing or by e-mail within a reasonable period of time, which determination shall be binding.

Notwithstanding anything to the contrary set forth in this Section 6, Acorn acknowledges and agrees that it shall not enforce the provisions of this Section 6 to the extent that their enforcement is prohibited under the rules of professional conduct pertaining to attorneys admitted in the States of North Carolina or Delaware.

(b)Consideration.  I acknowledge and understand that my employment is conditioned upon my agreeing to the terms of this Section 6 and other terms of this Agreement and my complying with all covenants set forth in this Section 6 and this Agreement, and I am willingly entering into the covenants set forth in this Section 6 and this Agreement in consideration of the Company hiring me.
(c)Understanding of Covenants.  I represent and agree that I (i) am familiar with the foregoing covenants not to compete and not to solicit and (ii) am fully aware of my obligations hereunder, including, without limitation, the reasonableness of the length of time, scope and geographic coverage of 

these covenants.  I acknowledge and agree that the provisions of this Section are reasonable and an integral part of my employment relationship with the Company and that the restrictions contained within this Section are part of the consideration received by the Company in connection with the entering into the employer-employee relationship with me, and that the restrictions are necessary to protect the Company's legitimate business interests and to prevent me from unfairly taking advantage of those contacts established or strengthened and the knowledge gained while with the Company.
(d)Cessation of Payments and Benefits Upon Breach.  Upon any breach of this Agreement by me, any severance payments which I may be entitled to, if any, shall immediately cease and terminate, and I shall be obligated to immediately return to the Company the full amount of any severance payments and the value of any severance benefits previously paid to or received by me.  I acknowledge and agree this subsection does not entitle me to receipt of any severance payments or benefits.
(e)Survival of Restrictions.  In the event that any provision of this Section 6 relating to the time period of the restrictions, the definitions of Customer or Business, the breadth of restricted activities or geographic area, or related matters, is declared by a court of competent jurisdiction to exceed the maximum restrictiveness such court deems reasonable and enforceable, then such aspects of this Section 6 as would be deemed reasonable and enforceable by the court will become and thereafter be the maximum restriction in such regard, and such restriction will remain enforceable to the fullest extent deemed reasonable by such court.  The restrictions set forth in this Section 6 shall survive the termination of this Agreement or the termination of my employment with the Company.  
(f)Inadequacy of Monetary Damages.  I acknowledge and agree that monetary damages alone would not adequately compensate the Company in the event of a breach by me of any of the provisions of this Section 6 or Sections 2, 3 or 5 of this Agreement.  In the event of a breach or threatened breach by me of any of the provisions of this Section 6 or Sections 2, 3 or 5 of this Agreement, the Company will have the right to seek both monetary damages for any past breach and equitable relief, including specific performance by means of an injunction or other action against me or against my partners, agents, representatives, servants, employers, employees, associates or any and all other persons acting directly or indirectly by or with me, to prevent or restrain any breach.
7.Termination Certification. Upon separation from employment with the Company, I agree to immediately sign and deliver to the Company the “Termination Certification” attached hereto as Exhibit B. I also agree to keep the Company advised of my home and business address for a period of one (1) year after termination of my employment with the Company, so that the Company can contact me regarding my continuing obligations provided by this Agreement.
8.Notification of New Employer. In the event that I leave the employ of the Company, I hereby grant consent to notification by the Company to my new employer about my obligations under this Agreement.
9.Code of Conduct and Ethics. I agree to diligently adhere to all policies of the Company including, but not limited to, its Code of Conduct and Ethics, all of which may be revised from time to time during my employment.
10.Representations. I agree to execute any proper oath or verify any proper document required to carry out the terms of this Agreement.  I represent that my performance of all the terms of this Agreement will not breach any agreement to keep in confidence proprietary information acquired by me in confidence or in trust prior to my employment by the Company.  I hereby represent and warrant that I have not entered into, and I will not enter into, any oral or written agreement in conflict herewith.
11.Audit. I acknowledge that I have no reasonable expectation of privacy in any computer, technology system, software, handheld device or telephone owned or licensed by the Company, or any documents or emails that are used in the conduct of the business of the Company.  As such, the Company has the right to audit and search all such items and systems, without further notice to me, to ensure that the Company is licensed to use the software on the Company's devices in compliance with the Company's software licensing policies, to ensure compliance with the Company's policies, and for any other business-related purposes in the Company's sole discretion.  I understand that I am not permitted to add any unlicensed, 

unauthorized, or non-compliant applications to the Company's technology systems and that I shall refrain from copying unlicensed software onto the Company's technology systems or using non-licensed software or web sites.  I understand that it is my responsibility to comply with the Company's policies governing use of the Company's documents and the internet, email, telephone, and technology systems to which I will have access in connection with my employment.
12.General Provisions.
A.Governing Law; Consent to Personal Jurisdiction. This Agreement will be governed by the laws of the State of Delaware without giving effect to any choice-of-law rules or principles that may result in the application of the laws of any jurisdiction other than Delaware.  To the extent that any lawsuit is permitted under this Agreement, I hereby expressly consent to the personal jurisdiction of the state and federal courts located in Delaware for any lawsuit filed against me by the Company.
B.Entire Agreement. This Agreement, together with the Exhibits herein, sets forth the entire agreement and understanding between the Company and me relating to the subject matter herein and supersedes all prior discussions or representations between us including, but not limited to, any representations made during my interview(s) or relocation negotiations (if any), whether written or oral.  No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, will be effective unless in writing signed by the Chief Executive Officer of Acorn and me.  Any subsequent change or changes in my duties, salary, or compensation will not affect the validity or scope of this Agreement.
C.Severability. If one or more of the provisions in this Agreement are deemed void by law, then the remaining provisions will continue in full force and effect.
D.Successors and Assigns. This Agreement will be binding upon my heirs, executors, assigns, administrators, and other legal representatives and will be for the benefit of the Company, its successors, and its assigns.  There are no intended third-party beneficiaries to this Agreement except as expressly stated.  The terms of this Agreement shall inure to the benefit of Acorn's direct and indirect subsidiaries and entities in which Acorn holds a significant ownership interest.
E.Waiver. Waiver by the Company of a breach of any provision of this Agreement will not operate as a waiver of any other or subsequent breach.
F.Survivorship. The rights and obligations of the parties to this Agreement will survive termination of my employment with the Company.  
G.Signatures. This Agreement may be signed in two counterparts, each of which shall be deemed an original, with the same force and effectiveness as though executed in a single document.
Date: January 24, 2012                                        
Heather K. Mallard

ACCEPTED AND AGREED TO:
ACORN ENERGY, INC.

By:                          
John A. Moore, CEO

Exhibit A
LIST OF PRIOR INVENTIONS
AND ORIGINAL WORKS OF AUTHORSHIP

	
			
	Title
	Date
	Identifying Number or Brief Description

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

___ No inventions or improvements
___ Additional Sheets Attached
Signature of Employee:                 
Print Name of Employee:                   
Date:                             

-2-

Exhibit B

ACORN ENERGY, INC.
TERMINATION CERTIFICATION
This is to certify that I do not have in my possession, nor have I failed to return, any devices, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, equipment, other documents, or property, or reproductions of any aforementioned items belonging to Acorn Energy, Inc. (“Acorn”) and its direct and indirect subsidiaries and entities in which Acorn directly or indirectly holds a significant ownership interest, together with their respective subsidiaries, affiliates, successors or assigns (the “Company.”)
I further certify that I have complied with all the terms of the Company's At-Will Employment, Confidential Information, Non-Competition and Invention Assignment Agreement signed by me, including the reporting of any inventions and original works of authorship (as defined therein), conceived or made by me (solely or jointly with others) covered by that agreement.
I further agree that, in compliance with the At-Will Employment, Confidential Information, Non-Competition and Invention Assignment Agreement, I will preserve as confidential all Company Confidential Information and Associated Third-Party Confidential Information, including trade secrets, confidential knowledge, data, or other proprietary information relating to products, processes, know-how, designs, formulas, developmental or experimental work, computer programs, data bases, other original works of authorship, customer lists, business plans, financial information, or other subject matter pertaining to any business of the Company or any of its employees, clients, consultants, or licensees.
After leaving the Company's employment, I will be employed by ___________________ in the position of:                 .
    
Signature of employee
    
Print name
    
Date
Address for Notifications:exhibit10-1.htm

SECOND AMENDMENT TO CREDIT AGREEMENT

THIS SECOND AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is made as of the 8th day of March, 2012, by and among USA TRUCK, INC., a Delaware corporation, INTERNATIONAL FREIGHT SERVICES, INC., a Delaware corporation, the LENDERS listed on the signature pages hereof and BRANCH BANKING AND TRUST COMPANY, as Administrative Agent.

R E C I T A L S:

The Borrower, the Initial Guarantors, the Administrative Agent and the Lenders have entered into a certain Credit Agreement dated as of April 19, 2010, as amended by that certain First Amendment to Credit Agreement dated as of June 14, 2010 by and among the Borrower, the Initial Guarantors, the Administrative Agent and the Lenders party thereto (collectively referred to herein as the “Credit Agreement”).  Capitalized terms used in this Amendment which are not otherwise defined in this Amendment shall have the respective meanings assigned to them in the Credit Agreement.

The Borrower, the Initial Guarantors, the Administrative Agent and the Lenders have agreed to amend the Credit Agreement to modify (i) certain financial covenants contained in Sections 5.03 and 5.04 of the Credit Agreement, (ii) the negative covenant on Restricted Payments in Section 5.11 of the Credit Agreement, (iii) the Applicable Margin, (iv) the Applicable Unused Fee Rate, and (v) certain other provisions of the Credit Agreement as set forth herein.

 

NOW, THEREFORE, in consideration of the Recitals and the mutual promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Borrower, the Initial Guarantors, the Administrative Agent and the Lenders, intending to be legally bound hereby, agree as follows:

SECTION 1.  Recitals.  The Recitals are incorporated herein by reference and shall be deemed to be a part of this Amendment.

SECTION 2.  Amendment.  The Credit Agreement is hereby amended as set forth in this Section 2.

SECTION 2.01.  Amendment to Section 1.01.  The following definitions are added to Section 1.01 of the Credit Agreement in the appropriate alphabetical order:

	
  

	
““Disqualified Capital Securities” means, with respect to any Person, any Capital Securities in such Person that requires the payment of any dividend or that by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable, either mandatorily or at the option of the holder thereof), or upon the happening of any event or condition:

(a) matures or is mandatorily redeemable (other than solely for Capital Securities in such Person that do not constitute Disqualified Capital Securities and cash in lieu of fractional shares of such Capital Securities), whether pursuant to a sinking fund obligation or otherwise;

(b) is convertible or exchangeable, either mandatorily or at the option of the holder thereof, for Debt or Capital Securities (other than solely for Capital Securities in such Person that do not constitute Disqualified Capital Securities and cash in lieu of fractional shares of such Capital Securities); or

(c) is redeemable (other than solely for Capital Securities in such Person that do not constitute Disqualified Capital Securities and cash in lieu of fractional shares of such Capital Securities) or is required to be repurchased by the Borrower or any Subsidiary, in whole or in part, at the option of the holder thereof;

in each case, on or prior to the date 180 days after the Termination Date.

	
  

	
“Qualifying Equity Proceeds”  means on any date with respect to any Restricted Payment, the aggregate amount of Net Proceeds of Capital Stock/Conversion of Debt received by the Borrower in respect of sales and issuances of its Capital Securities (other than Disqualified Capital Securities and other than sales or issuances to directors, officers and employees) during the 90-day period ending on the date such Restricted Payment is made, less the amount of all other expenditures for such purposes made during such period and on or prior to such date in reliance on such receipts of Net Proceeds of Capital Stock/Conversion of Debt.

 

	
  

	
“Second Amendment Effective Date” means March 8, 2012.”

 

SECTION 2.02.  Amendment to Section 2.06(a).  Section 2.06(a) of the Credit Agreement is amended and restated to read in its entirety as follows:

“(a)(i)           As of the Closing Date and until (but excluding) the Second Amendment Effective Date, the “Applicable Margin” shall be determined quarterly based upon the ratio of Consolidated Debt (calculated as of the last day of each Fiscal Quarter) to Consolidated EBITDAR (calculated as of the last day of each Fiscal Quarter for the Fiscal Quarter then ended and the immediately preceding three Fiscal Quarters), as follows:

 

          Ratio of Consolidated Debt                                                                           Euro-Dollar Loans and                                                

          to Consolidated EBITDAR                                                                                Letters of Credit                                           Base Rate Loans

Greater than 2.75 to 1.00                                                                                     3.25%                 1.0%

Greater than 2.25 to 1.00

but less than or equal to 2.75 to 1.00                                                                2.75%                 0.5%

Greater than 1.75 to 1.00

but less than or equal to 2.25 to 1.00                                                                2.50%                 0.25%

Less than or equal to 1.75 to 1.00                                                                      2.00%                 0%.

The Applicable Margin shall be determined effective as of the date (herein, the “Rate Determination Date”) which is the first day of the first calendar month after the day the Administrative Agent receives (or should have received, if Borrower had complied with Section 5.01(l)), the Margin and Fee Rate Report for the Fiscal Quarter for which the ratio of Consolidated Debt to Consolidated EBITDAR is being determined, and the Applicable Margin so determined shall remain effective from such Rate Determination Date until the date which is the first day of the first calendar month after the day the Administrative Agent receives or should have received, if Borrower had complied with Section 5.01(l) the Margin and Fee Rate Report for the Fiscal Quarter in which such Rate Determination Date falls (which latter date shall be a new Rate Determination Date); provided that (i) for the period from and including the Closing Date to but excluding the Rate Determination Date next following the Closing Date, the Applicable Margin shall be 2.50% for a Euro-Dollar Advance and Letters of Credit and 0.25% for a Base Rate Loan, (ii) in the case of any Applicable Margin determined for the fourth and final Fiscal Quarter of a Fiscal Year, such Applicable Margin shall be redetermined based upon the annual audited financial statements for the Fiscal Year ending on the last day of such final Fiscal Quarter, and if such Applicable Margin as so redetermined shall be different from the Applicable Margin for such date determined on the Rate Determination Date for such fourth Fiscal Quarter, such redetermined Applicable Margin shall be effective retroactive to the Rate Determination Date, and the Borrower, the Administrative Agent and the Lenders, as applicable, shall within ten (10) days of such redetermination, make a payment (in the case of amounts owing by the Borrower to the Lenders) or provide a credit applicable to future amounts payable by the Borrower hereunder (in the case of amounts owing by the Lenders to the Borrower) equal to the difference between the interest and letter of credit fees actually paid under this Agreement and the interest and fees that would have been paid under this Agreement had the Applicable Margin as originally determined been equal to the Applicable Margin as redetermined, and (iii) if on any Rate Determination Date (determined as if Borrower had delivered the Margin and Fee Rate Report in accordance with Section 5.01(l)) the Borrower shall have failed to deliver to the Lender the Margin and Fee Rate Report required to be delivered pursuant to Section 5.01(l) with respect to the Fiscal Year or Fiscal Quarter, as the case may be, most recently ended prior to such Rate Determination Date (determined as if Borrower had delivered the Margin and Fee Rate Report in accordance with Section 5.01(l)), then for the period beginning on such Rate Determination Date (determined as if Borrower had delivered the Margin and Fee Rate Report in accordance with Section 5.01(l)) and ending on the earlier of (A) the date on which the Borrower shall deliver to the Administrative Agent the Margin and Fee Rate Report to be delivered pursuant to 5.01(l) with respect to such Fiscal Quarter, the Advances shall bear interest at a rate per annum determined as if the ratio of Consolidated Debt to Consolidated EBITDAR is greater than 2.75 to 1.00; provided that at the election of the Required Lenders, the principal amount of the Advances shall bear interest at the Default Rate upon the failure by the Borrower to deliver any Margin and Fee Rate Report.  Any change in the Applicable Margin on any Rate Determination Date shall result in a corresponding change, effective on and as of such Rate Determination Date, in the interest rate applicable to the Advances and in the fees applicable to each Letter of Credit outstanding on such Rate Determination Date; provided, that no Applicable Margin shall be decreased pursuant to this Section 2.06 if a Default is in existence on the Rate Determination Date.  In the event that any financial statement or Margin and Fee Rate Report delivered pursuant to Section 5.01 is shown to be, or becomes known to be, inaccurate (regardless of whether this Agreement or the Revolver Commitments are in effect when such inaccuracy is discovered), and such inaccuracy, if corrected, would have led to the application of a higher Applicable Margin under this Section 2.06 for any period rather than the Applicable Margin applied for such period, then (i) the Borrower shall immediately deliver to the Administrative Agent a corrected Margin and Fee Rate Report and related financial information for such period, (ii) the Applicable Margin shall be at the actual Applicable Margin under this Section 2.06 for such period, and (iii) the Borrower shall immediately pay to the Administrative Agent, for the account of the Lenders, the accrued additional interest owing as a result of such increased Applicable Margin for such period.  The provisions of this Section 2.06(a) shall not limit the rights of the Administrative Agent and the Lenders with respect to Sections 2.06(b) or 2.06(c) or Article VI and shall survive the termination of this Agreement and the Revolver Commitments.

(ii)           As of the Second Amendment Effective Date, the “Applicable Margin” shall be determined quarterly based upon the ratio of Consolidated Debt (calculated as of the last day of each Fiscal Quarter) to Consolidated EBITDAR (calculated as of the last day of each Fiscal Quarter for the Fiscal Quarter then ended and the immediately preceding three Fiscal Quarters), as follows:

 

          Ratio of Consolidated Debt                                                                           Euro-Dollar Loans and                                    

          to Consolidated EBITDAR                                                                                Letters of Credit                                           Base Rate Loans

Greater than 3.00 to 1.00                                                                                     3.75%                 1.50%

Greater than 2.75 to 1.00

but less than or equal to 3.00 to 1.00                                                                3.25%                 1.00%

Greater than 2.25 to 1.00

but less than or equal to 2.75 to 1.00                                                                2.75%                 0.5%

Greater than 1.75 to 1.00

but less than or equal to 2.25 to 1.00                                                                2.50%                 0.25%

Less than or equal to 1.75 to 1.00                                                                      2.00%                 0%.

The Applicable Margin shall be determined effective as of the date (herein, the “Rate Determination Date”) which is the first day of the first calendar month after the day the Administrative Agent receives (or should have received, if Borrower had complied with Section 5.01(l), the Margin and Fee Rate Report for the Fiscal Quarter for which the ratio of Consolidated Debt to Consolidated EBITDAR is being determined, and the Applicable Margin so determined shall remain effective from such Rate Determination Date until the date which is the first day of the first calendar month after the day the Administrative Agent receives or should have received, if Borrower had complied with Section 5.01(l) the Margin and Fee Rate Report for the Fiscal Quarter in which such Rate Determination Date falls (which latter date shall be a new Rate Determination Date); provided that (i) for the period from and including the Second Amendment Effective Date to but excluding the Rate Determination Date next following the Second Amendment Effective Date, the Applicable Margin shall be 3.25% for a Euro-Dollar Advance and Letters of Credit and 1.00% for a Base Rate Loan, (ii) in the case of any Applicable Margin determined for the fourth and final Fiscal Quarter of a Fiscal Year, such Applicable Margin shall be redetermined based upon the annual audited financial statements for the Fiscal Year ending on the last day of such final Fiscal Quarter, and if such Applicable Margin as so redetermined shall be different from the Applicable Margin for such date determined on the Rate Determination Date for such fourth Fiscal Quarter, such redetermined Applicable Margin shall be effective retroactive to the Rate Determination Date, and the Borrower, the Administrative Agent and the Lenders, as applicable, shall within ten (10) days of such redetermination, make a payment (in the case of amounts owing by the Borrower to the Lenders) or provide a credit applicable to future amounts payable by the Borrower hereunder (in the case of amounts owing by the Lenders to the Borrower) equal to the difference between the interest and letter of credit fees actually paid under this Agreement and the interest and fees that would have been paid under this Agreement had the Applicable Margin as originally determined been equal to the Applicable Margin as redetermined, and (iii) if on any Rate Determination Date (determined as if Borrower had delivered the Margin and Fee Rate Report in accordance with Section 5.01(l)) the Borrower shall have failed to deliver to the Lender the Margin and Fee Rate Report required to be delivered pursuant to Section 5.01(l) with respect to the Fiscal Year or Fiscal Quarter, as the case may be, most recently ended prior to such Rate Determination Date (determined as if Borrower had delivered the Margin and Fee Rate Report in accordance with Section 5.01(l)), then for the period beginning on such Rate Determination Date (determined as if Borrower had delivered the Margin and Fee Rate Report in accordance with Section 5.01(l)) and ending on the earlier of (A) the date on which the Borrower shall deliver to the Administrative Agent the Margin and Fee Rate Report to be delivered pursuant to 5.01(l) with respect to such Fiscal Quarter, the Advances shall bear interest at a rate per annum determined as if the ratio of Consolidated Debt to Consolidated EBITDAR is greater than 3.00 to 1.00; provided that at the election of the Required Lenders, the principal amount of the Advances shall bear interest at the Default Rate upon the failure by the Borrower to deliver any Margin and Fee Rate Report.  Any change in the Applicable Margin on any Rate Determination Date shall result in a corresponding change, effective on and as of such Rate Determination Date, in the interest rate applicable to the Advances and in the fees applicable to each Letter of Credit outstanding on such Rate Determination Date; provided, that no Applicable Margin shall be decreased pursuant to this Section 2.06 if a Default is in existence on the Rate Determination Date.  In the event that any financial statement or Margin and Fee Rate Report delivered pursuant to Section 5.01 is shown to be, or becomes known to be, inaccurate (regardless of whether this Agreement or the Revolver Commitments are in effect when such inaccuracy is discovered), and such inaccuracy, if corrected, would have led to the application of a higher Applicable Margin under this Section 2.06 for any period rather than the Applicable Margin applied for such period, then (i) the Borrower shall immediately deliver to the Administrative Agent a corrected Margin and Fee Rate Report and related financial information for such period, (ii) the Applicable Margin shall be at the actual Applicable Margin under this Section 2.06 for such period, and (iii) the Borrower shall immediately pay to the Administrative Agent, for the account of the Lenders, the accrued additional interest owing as a result of such increased Applicable Margin for such period.  The provisions of this Section 2.06(a) shall not limit the rights of the Administrative Agent and the Lenders with respect to Sections 2.06(b) or 2.06(c) or Article VI and shall survive the termination of this Agreement and the Revolver Commitments.”

SECTION 2.03.  Amendment to Section 2.07(b).  Section 2.07(b) of the Credit Agreement is amended and restated to read in its entirety as follows:

“(b)(i)           As of the Closing Date and until (but excluding) the Second Amendment Effective Date, the “Applicable Unused Fee Rate” shall be determined quarterly based upon the ratio of Consolidated Debt (calculated as of the last day of each Fiscal Quarter) to Consolidated EBITDAR (calculated as of the last day of each Fiscal Quarter for the Fiscal Quarter then ended and the immediately preceding three Fiscal Quarters), as follows:

 

Ratio of Consolidated Debt                                                                                     

to Consolidated EBITDAR                                                                                        Applicable Unused Fee Rate

Greater than 2.75 to 1.00                                                                                                  0.375%

Greater than 2.25 to 1.00 but less than

or equal to 2.75 to 1.00                                                                                           0.30%

Greater than 1.75 to 1.00 but less than

or equal to 2.25 to 1.00                                                                                           0.25%

Less than or equal to 1.75 to 1.00                                                                                           0.25%

The Applicable Unused Fee Rate shall be determined effective as of the date (herein, the “Unused Fee Determination Date”) which is the first day of the first calendar month after the day the Administrative Agent receives the Margin and Fee Rate Report for the Fiscal Quarter which the ratio of Consolidated Debt to Consolidated EBITDAR is being determined, and the Applicable Unused Fee Rate so determined shall remain effective from such Unused Fee Determination Date until the date which is the first day of the first calendar month after the day the Administrative Agent receives the Margin and Fee Rate Report for the Fiscal Quarter in which such Unused Fee Determination Date falls (which latter date shall be a new Unused Fee Determination Date); provided that (i) for the period from and including the Closing Date to but excluding the Unused Fee Determination Date next following the Closing Date, the Applicable Unused Fee Rate shall be 0.25%; (ii) in the case of any Applicable Unused Fee Rate determined for the fourth and final Fiscal Quarter of a Fiscal Year, the Applicable Unused Fee Rate shall be redetermined based upon the annual audited financial statements for the Fiscal Year ending on the last day of such final Fiscal Quarter, and if such Applicable Unused Fee Rate as so redetermined shall be different from the Applicable Unused Fee Rate for such date determined on the Unused Fee Determination Date for such fourth Fiscal Quarter, such redetermined Applicable Unused Fee Rate shall be effective retroactive to the Unused Fee Determination Date, and the Borrower, the Administrative Agent and the Lenders, as applicable, shall within ten (10) days of such redetermination, make a payment (in the case of amounts owing by the Borrower to the Lenders) or provide a credit applicable to future amounts payable by the Borrower hereunder (in the case of amounts owing by the Lenders to the Borrower) equal to the difference between the non-utilization fees actually paid under this Agreement and the non-utilization fees that would have been paid under this Agreement had the Applicable Unused Fee Rate as originally determined been equal to the Applicable Unused Fee Rate as redetermined, and (iii) if on any Unused Fee Determination Date (determined as if Borrower had delivered the Margin and Fee Rate Report in accordance with Section 5.01(l)) the Borrower shall have failed to deliver to the Administrative Agent the Margin and Fee Rate Report required to be delivered pursuant to Section 5.01(l) with respect to the Fiscal Year or Fiscal Quarter, as the case may be, most recently ended prior to such Unused Fee Determination Date (determined as if Borrower had delivered the Margin and Fee Rate Report in accordance with Section 5.01(l)), then for the period beginning on such Unused Fee Determination Date (determined as if Borrower had delivered the Margin and Fee Rate Report in accordance with Section 5.01(l)) and ending on the earlier of (A) the date on which the Borrower shall deliver to the Administrative Agent the Margin and Fee Rate Report to be delivered pursuant to Section 5.01(l) with respect to such Fiscal Quarter or any subsequent Fiscal Quarter, and (B) the date on which the Borrower shall deliver to the Lender the Margin and Fee Rate Report required to be delivered pursuant to Section 5.01(l) with respect to the Fiscal Year which includes such Fiscal Quarter or any subsequent Fiscal Year, the Applicable Unused Fee Rate shall be determined as if the ratio of Consolidated Debt to Consolidated EBITDAR is greater than 2.75 to 1.00.  In no event shall the Applicable Unused Fee Rate be decreased pursuant to this Section 2.07 if a Default is in existence on the Unused Fee Determination Date.  In the event that any financial statement or Margin and Fee Rate Report delivered pursuant to Section 5.01 is shown to be, or becomes known to be, inaccurate (regardless of whether this Agreement or the Revolver Commitments are in effect when such inaccuracy is discovered), and such inaccuracy, if corrected, would have led to the application of a higher Applicable Unused Fee Rate under this Section 2.07 for any period rather than the Applicable Unused Fee Rate applied for such period, then (i) the Borrower shall immediately deliver to the Administrative Agent a corrected Margin and Fee Rate Report and related financial information for such period, (ii) the Applicable Unused Fee Rate shall be at the actual Applicable Unused Fee Rate under this Section 2.07 for such period, and (iii) the Borrower shall immediately pay to the Administrative Agent, for the account of the Lenders, the accrued additional amount owing as a result of such increased Applicable Unused Fee Rate for such period.  The provisions of this Section 2.07(b) shall not limit the rights of the Administrative Agent and the Lenders with respect to Article VI and shall survive the termination of this Agreement and the Revolver Commitments.

(ii)          As of the Second Amendment Effective Date, the “Applicable Unused Fee Rate” shall be determined quarterly based upon the ratio of Consolidated Debt (calculated as of the last day of each Fiscal Quarter) to Consolidated EBITDAR (calculated as of the last day of each Fiscal Quarter for the Fiscal Quarter then ended and the immediately preceding three Fiscal Quarters), as follows:

 

Ratio of Consolidated Debt                                                                                    

to Consolidated EBITDAR                                                                                     Applicable Unused Fee Rate

Greater than 3.00 to 1.00                                                                                                 0.375%

Greater than 2.75 to 1.00 but less than

or equal to 3.00 to 1.00                                                                                           0.375%

Greater than 2.25 to 1.00 but less than

or equal to 2.75 to 1.00                                                                                           0.30%

Greater than 1.75 to 1.00 but less than

or equal to 2.25 to 1.00                                                                                           0.25%

Less than or equal to 1.75 to 1.00                                                                                           0.25%

The Applicable Unused Fee Rate shall be determined effective as of the date (herein, the “Unused Fee Determination Date”) which is the first day of the first calendar month after the day the Administrative Agent receives the Margin and Fee Rate Report for the Fiscal Quarter which the ratio of Consolidated Debt to Consolidated EBITDAR is being determined, and the Applicable Unused Fee Rate so determined shall remain effective from such Unused Fee Determination Date until the date which is the first day of the first calendar month after the day the Administrative Agent receives the Margin and Fee Rate Report for the Fiscal Quarter in which such Unused Fee Determination Date falls (which latter date shall be a new Unused Fee Determination Date); provided that (i) for the period from and including the Second Amendment Effective Date to but excluding the Unused Fee Determination Date next following the Second Amendment Effective Date, the Applicable Unused Fee Rate shall be 0.375%; (ii) in the case of any Applicable Unused Fee Rate determined for the fourth and final Fiscal Quarter of a Fiscal Year, the Applicable Unused Fee Rate shall be redetermined based upon the annual audited financial statements for the Fiscal Year ending on the last day of such final Fiscal Quarter, and if such Applicable Unused Fee Rate as so redetermined shall be different from the Applicable Unused Fee Rate for such date determined on the Unused Fee Determination Date for such fourth Fiscal Quarter, such redetermined Applicable Unused Fee Rate shall be effective retroactive to the Unused Fee Determination Date, and the Borrower, the Administrative Agent and the Lenders, as applicable, shall within ten (10) days of such redetermination, make a payment (in the case of amounts owing by the Borrower to the Lenders) or provide a credit applicable to future amounts payable by the Borrower hereunder (in the case of amounts owing by the Lenders to the Borrower) equal to the difference between the non-utilization fees actually paid under this Agreement and the non-utilization fees that would have been paid under this Agreement had the Applicable Unused Fee Rate as originally determined been equal to the Applicable Unused Fee Rate as redetermined, and (iii) if on any Unused Fee Determination Date (determined as if Borrower had delivered the Margin and Fee Rate Report in accordance with Section 5.01(l)) the Borrower shall have failed to deliver to the Administrative Agent the Margin and Fee Rate Report required to be delivered pursuant to Section 5.01(l) with respect to the Fiscal Year or Fiscal Quarter, as the case may be, most recently ended prior to such Unused Fee Determination Date (determined as if Borrower had delivered the Margin and Fee Rate Report in accordance with Section 5.01(l)), then for the period beginning on such Unused Fee Determination Date (determined as if Borrower had delivered the Margin and Fee Rate Report in accordance with Section 5.01(l)) and ending on the earlier of (A) the date on which the Borrower shall deliver to the Administrative Agent the Margin and Fee Rate Report to be delivered pursuant to Section 5.01(l) with respect to such Fiscal Quarter or any subsequent Fiscal Quarter, and (B) the date on which the Borrower shall deliver to the Lender the Margin and Fee Rate Report required to be delivered pursuant to Section 5.01(l) with respect to the Fiscal Year which includes such Fiscal Quarter or any subsequent Fiscal Year, the Applicable Unused Fee Rate shall be determined as if the ratio of Consolidated Debt to Consolidated EBITDAR is greater than 3.00 to 1.00.  In no event shall the Applicable Unused Fee Rate be decreased pursuant to this Section 2.07 if a Default is in existence on the Unused Fee Determination Date.  In the event that any financial statement or Margin and Fee Rate Report delivered pursuant to Section 5.01 is shown to be, or becomes known to be, inaccurate (regardless of whether this Agreement or the Revolver Commitments are in effect when such inaccuracy is discovered), and such inaccuracy, if corrected, would have led to the application of a higher Applicable Unused Fee Rate under this Section 2.07 for any period rather than the Applicable Unused Fee Rate applied for such period, then (i) the Borrower shall immediately deliver to the Administrative Agent a corrected Margin and Fee Rate Report and related financial information for such period, (ii) the Applicable Unused Fee Rate shall be at the actual Applicable Unused Fee Rate under this Section 2.07 for such period, and (iii) the Borrower shall immediately pay to the Administrative Agent, for the account of the Lenders, the accrued additional amount owing as a result of such increased Applicable Unused Fee Rate for such period.  The provisions of this Section 2.07(b) shall not limit the rights of the Administrative Agent and the Lenders with respect to Article VI and shall survive the termination of this Agreement and the Revolver Commitments.”

SECTION 2.04.  Amendment to Section 5.02(v).  Section 5.02(v) of the Credit Agreement is amended by replacing the phrase “such request may not be made more than once during any twenty-four (24) month period” appearing therein with the phrase “such request may not be made more than once during any twelve (12) month period”.

SECTION 2.05.  Amendment to Section 5.03.  Section 5.03 of the Credit Agreement is amended and restated to read in its entirety as follows:

“SECTION 5.03.                                Maximum Leverage.  At the end of each Fiscal Quarter, the ratio of Consolidated Debt as of such date to Consolidated EBITDAR for the Fiscal Quarter then ending and the immediately preceding three Fiscal Quarters will not at any time exceed:  (i) for the period commencing on the Closing Date and ending on December 31, 2010, 3.25 to 1.00; (ii) for the period commencing on January 1, 2011 and ending on December 31, 2011, 3.00 to 1.00; (iii) for the period commencing on January 1, 2012 and ending on June 30, 2012, 3.60 to 1.00; (iv) for the period commencing on July 1, 2012 and ending on September 30, 2012, 3.40 to 1.00; (v) for the period commencing on October 1, 2012 and ending on December 31, 2012, 3.25 to 1.00; and (vi) for the period commencing on January 1, 2013, and at all times thereafter, 3.00 to 1.00.”

 

SECTION 2.06.  Amendment to Section 5.04.  Section 5.04 of the Credit Agreement is amended and restated to read in its entirety as follows:

“SECTION 5.04.                                Fixed Charge Coverage.  At the end of each Fiscal Quarter, the Consolidated Fixed Charge Coverage Ratio shall not be less than:  (i) for the period commencing on the Closing Date and ending on December 31, 2011, 1.40 to 1.00; (ii) for the period commencing on January 1, 2012 and ending on June 30, 2012, 1.00 to 1.00; (iii) for the period commencing on July 1, 2012 and ending on September 30, 2012, 1.10 to 1.00; (iv) for the period commencing on October 1, 2012 and ending on December 31, 2012, 1.20 to 1.00; and (v) for the period commencing on January 1, 2013, and at all times thereafter, 1.40 to 1.00.”

 

SECTION 2.07.  Amendments to Section 5.11.  Section 5.11(c) of the Credit Agreement is amended and restated to read in its entirety as follows:

“(c)           so long as no Default shall have occurred and be continuing and the Borrower shall be in pro forma compliance with the covenants set forth in Sections 5.03 and 5.04 after giving effect thereto, the Borrower may declare and make: (1) prior to April 1, 2013, (A) payments described within subsection (iii) of the definition of Restricted Payments in an aggregate amount not exceeding the lesser of: (i) the then available amount of Qualifying Equity Proceeds immediately prior to the making of such Restricted Payment in reliance of this clause (c) and (ii) $15,000,000; (B) payments described within subsection (ii) of the definition of Restricted Payments to Persons that are not Affiliates of the Borrower or directors, officers or employees of the Borrower or any Affiliates of the Borrower; (C) prior to December 31, 2012, dividends and other distributions described within subsection (i) of the definition of Restricted Payments with respect to Capital Securities other than common stock of the Borrower, so long as after giving effect to each such Restricted Payment described in this Section 5.11(c)(1)(C): (1) the aggregate of all Restricted Payments declared or made during such Fiscal Year does not exceed $15,000,000, (2) the Borrower’s pro forma Consolidated Fixed Charge Coverage Ratio is not less than 1.40 to 1.00 and (3) the Borrower’s pro forma ratio of Consolidated Debt as of the last day of the Fiscal Quarter immediately preceding such Restricted Payment to Consolidated EBITDAR for the Fiscal Quarter then ending and the immediately preceding three Fiscal Quarters will not exceed 3.00 to 1.00; and (D) if at the end of the Fiscal Quarter ending on December 31, 2012 the Consolidated Fixed Charge Coverage Ratio is not less than 1.40 to 1.00 and the ratio of Consolidated Debt as of such date to Consolidated EBITDAR for the Fiscal Quarter then ending and the immediately preceding three Fiscal Quarters will not exceed 3.00 to 1.00, dividends and other distributions described within subsection (i) of the definition of Restricted Payments made after January 1, 2013 so long as after giving effect to each such Restricted Payment described in this Section 5.11(c)(1)(D) the aggregate of all Restricted Payments declared or made during such Fiscal Year does not exceed $15,000,000; and (2) after April 1, 2013, Restricted Payments so long as after giving effect to each such Restricted Payment, the aggregate of all Restricted Payments declared or made during any Fiscal Year does not exceed $15,000,000. The Borrower shall provide the Administrative Agent written notice of such Restricted Payment promptly on the same day of the payment of such Restricted Payment.”

SECTION 3.  Conditions Precedent to Effectiveness.  The effectiveness of this Amendment and the obligations of the Lenders hereunder are subject to the following conditions, unless the Required Lenders waive such conditions:

(a)           receipt by the Administrative Agent from each of the parties hereto of a duly executed counterpart of this Amendment signed by such party;

(b)           receipt by the Administrative Agent of all documents which the Administrative Agent or any Lender may reasonably request relating to the existence of each Loan Party, the authority for and the validity of this Amendment, and any other matters relevant hereto, all in form and substance satisfactory to the Administrative Agent, including without limitation a certificate of incumbency of each Loan Party (the “Officer’s Certificate”), signed by the Secretary, an Assistant Secretary, or other authorized representative of the respective Loan Party, substantially in the form of Exhibit G to the Credit Agreement, certifying as to the names, true signatures and incumbency of the officer or officers of the respective Loan Party, authorized to execute and deliver this Amendment, and certified copies of the following items:  (i) the Loan Party’s Organizational Documents; (ii) the Loan Party’s Operating Documents; (iii) a certificate of the Secretary of State of such Loan Party’s state of organization as to the good standing or existence of such Loan Party, and (iv) the Organizational Action, if any, taken by the board of directors of the Loan Party authorizing the Loan Party’s execution, delivery and performance of this Amendment;

 

(c)           the fact that the representations and warranties of the Borrower and Initial Guarantors contained in Section 5 of this Amendment shall be true on and as of the date hereof; and

(d)           the Borrower shall have (i) paid to the Administrative Agent for the account of each Lender that is a signatory to this Amendment (each an “Approving Lender”), a fee equal to the aggregate of 0.25% of each Approving Lender’s Revolver Commitment; and (ii) reimbursed the Administrative Agent for all fees, costs and expenses of closing presented as of the Second Amendment Effective Date.

SECTION 4.  No Other Amendment.  Except for the amendments set forth above, the text of the Credit Agreement shall remain unchanged and in full force and effect.  On and after the Second Amendment Effective Date, all references to the Credit Agreement in each of the Loan Documents shall hereafter mean the Credit Agreement as amended by this Amendment.   This Amendment is not intended to effect, nor shall it be construed as, a novation.  The Credit Agreement and this Amendment shall be construed together as a single agreement.  Nothing herein contained shall waive, annul, vary or affect any provision, condition, covenant or agreement contained in the Credit Agreement, except as herein amended, nor affect nor impair any rights, powers or remedies under the Credit Agreement as hereby amended.  The Lenders and the Administrative Agent do hereby reserve all of their rights and remedies against all parties who may be or may hereafter become secondarily liable for the repayment of the Notes.  The Borrower and Initial Guarantors promise and agree to perform all of the requirements, conditions, agreements and obligations under the terms of the Credit Agreement, as heretofore and hereby amended, and the other Loan Documents being hereby ratified and affirmed.  The Borrower and Initial Guarantors hereby expressly agree that the Credit Agreement, as amended, and the other Loan Documents are in full force and effect.

SECTION 5.  Representations and Warranties.  The Borrower and Initial Guarantors hereby represent and warrant to each of the Lenders as follows:

(a)           After giving effect to this Amendment, no Default or Event of Default under the Credit Agreement or any other Loan Document shall have occurred and be continuing unwaived by the Lenders on the date hereof.

(b)           Upon the effectiveness of this Amendment, all of the representations and warranties contained in the Credit Agreement and in the other Loan Documents (other than those which speak expressly only as of an earlier date) are true and correct in all material respects on and as of the date of the effectiveness of this Amendment after giving effect to this Amendment and the transactions contemplated hereby.

(c)           The Borrower and Initial Guarantors have the power and authority to enter into this Amendment and to do all acts and things as are required or contemplated hereunder to be done, observed and performed by them.

(d)           This Amendment has been duly authorized, validly executed and delivered by one or more authorized officers of the Borrower and Initial Guarantors and constitutes the legal, valid and binding obligations of the Borrower and Initial Guarantors enforceable against them in accordance with its terms, provided that such enforceability is subject to general principles of equity.

(e)           The execution and delivery of this Amendment and the performance by the Borrower and Initial Guarantors hereunder do not and will not require the consent or approval of any regulatory authority or governmental authority or agency having jurisdiction over the Borrower, or any Guarantor, nor be in contravention of or in conflict with the articles of incorporation, bylaws or other organizational documents of the Borrower, or any Guarantor that is a corporation, the articles of organization or operating agreement of any Guarantor that is a limited liability company, or the provision of any statute, or any judgment, order or indenture, instrument, agreement or undertaking, to which any Borrower, or any Guarantor is party or by which the assets or properties of the Borrower and Initial Guarantors are or may become bound.

(f)           The Collateral Documents continue to create a valid security interest in, and Lien upon, the Collateral, in favor of the Administrative Agent, for the benefit of the Secured Parties, which security interests and Liens are perfected in accordance with the terms of the Collateral Documents and prior to all other Liens.

SECTION 6.  Counterparts.  This Amendment may be executed in multiple counterparts, each of which shall be deemed to be an original and all of which, taken together, shall constitute one and the same agreement.

SECTION 7.  Governing Law.  This Amendment shall be construed in accordance with and governed by the laws of the State of North Carolina.

SECTION 8.  Effective Date.  Upon satisfaction of the conditions precedent set forth in Section 3 of this Amendment, this Amendment shall be deemed effective as of the Second Amendment Effective Date.

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IN WITNESS WHEREOF, the parties hereto have executed and delivered, or have caused their respective duly authorized officers or representatives to execute and deliver, this Amendment as of the day and year first above written.

USA TRUCK, INC.

By:           /s/ Darron R. Ming

Darron R. Ming

Vice President

[CORPORATE SEAL]

INITIAL GUARANTOR

INTERNATIONAL FREIGHT SERVICES, INC.

By:           /s/ Darron R. Ming

Darron R. Ming

Vice President

[CORPORATE SEAL]

[The remainder of this page intentionally left blank.]

 

  

  

  

BRANCH BANKING AND TRUST COMPANY,

as Administrative Agent and as a Lender

By:             /s/ Christopher E. Verwoerdt (SEAL)

Name:   Christopher E. Verwoerdt

Title:     Senior Vice President

[The remainder of this page intentionally left blank.]

 

  

  

  

REGIONS BANK

By:           /s/ David Cravens (SEAL)

Name:  David Cravens

Title:  Exec, Vice President

[The remainder of this page intentionally left blank.]

 

  

  

  

U.S. BANK NATIONAL ASSOCIATION

By:           /s/ Edward B. Hanson                                           (SEAL)

Name:  Edward B. Hanson

Title:  Vice President

[The remainder of this page intentionally left blank.]

 

  

  

  

BANK OF AMERICA, N.A.

By:           /s/ Lisa Chrzanowki (SEAL)

Name:  Lisa Chrzanowki

Title:  Vice President

[The remainder of this page intentionally left blank.]

 

WCSR  7125421v7

  

  

  

BANCORPSOUTH BANK

By:           /s/ Philip W. Doss (SEAL)

Name:  Philip W. Doss

Title:  Senior Vice President

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