Document:

Exhibit 10.1

 

	
  

  	
   

  	
  Corporate Offices

  1000 Bishops Gate Blvd, Suite 300

  Mount Laurel, NJ 08054-4632

  

 

June 2, 2005

 

Ms. Kathleen Donovan

1250 Taylor Drive

Langhorne, PA 19047

 

Dear Kathleen:

 

On behalf of MedQuist Inc. (the “Company”),
this Agreement describes the terms of your new employment as the Company’s
Senior Vice President and Chief Financial Officer, which must commence on a
date mutually agreed to in writing by you and the Company (the “Employment
Commencement Date”).  For purposes of
this Agreement, you are referred to as the “Employee.”  Other capitalized terms used in this
Agreement have the meanings defined in Section 7, below.

 

1.  Term.  The Company shall employ Employee hereunder
for a three (3) year term commencing on the Employment Commencement Date
hereof (the “Term”), which Term will be automatically extended for
additional one (1) year periods beginning on the third anniversary of the
Employment Commencement Date and upon each subsequent anniversary thereof
unless either party provides the other party with at least ninety (90) days
prior written notice of its intention not to renew this Agreement unless
terminated earlier pursuant to Sections 3 or 5 of this Agreement.

 

2.  Consideration.

 

a.  Compensation.  As consideration for all services rendered by
Employee to the Company and for the Covenants contained herein, Employee will
be entitled to:

 

(1)  base salary at an annual rate of $375,000;

 

(2)  a signing bonus of $200,000 with the
following payment schedule:  $50,000 to
be paid within thirty (30) days of Employment Commencement Date, and $50,000 to
be paid on the 12 month anniversary of the Employment Commencement Date, and
$100,000 to be paid on the 24 month anniversary of the Employment Commencement
Date.  In order to receive the installments
of the signing bonus, you must be employed by the Company on the scheduled date
of the applicable installment payment. 
In the event that you voluntarily resign from the Company within your
first 12 months of employment, the initial $100,000 signing bonus installment
must be repaid on a pro rata basis and you will not be entitled to the
remaining installments of the signing bonus;

 

(3)  participate in MedQuist’s Management
Bonus Plan for 2005.  Your target bonus
in this plan will be 45% of your base salary for 2005 and following years;
provided, however that your bonus for 2005 shall be prorated based upon your
Employment Commencement Date.  The target
bonus is the payment amount that the

 

 

Employee shall be eligible to receive if the Company and Employee both
attain the pre-established bonus plan target objectives.  The actual bonus award may be higher or lower
than the target bonus amount based upon achievement of the objectives by
Employee and the Company.  Management
Bonus Plan target objectives shall be developed on or before February 28th
of each year of the Management Bonus Plan;

 

(4)  participate in the same employee
benefit plans available generally to other full-time employees of the Company,
subject to the terms of those plans (as the same may be modified, amended or
terminated from time to time); (benefits information package enclosed);

 

(5)  if Employee’s employment is terminated
by the Company without Cause, the severance pay and benefits described below in
Section 5.

 

b.  Long Term Incentives.  In addition, from time to time, the Board may
review the performance of the Company and Employee and, in its sole discretion,
may grant stock options, shares of restricted stock or other equity-based
incentives to Employee to reward extraordinary performance and/or to encourage
Employee’s future efforts on behalf of the Company.  The grant of any such equity incentives will
be subject to the terms of the Company’s equity-based plans and will be
evidenced by a separate award agreement by and between the Company and
Employee.

 

(1)  Upon joining MedQuist, you will become
entitled to a special stock option grant of 80,000 shares of non-qualified
stock options (“Special Option Grant”) to purchase Company common stock, no par
value (“Common Stock”), pursuant to the Company’s Stock Option Plan adopted May 29,
2002 (the “Option Plan”).  The grant date
of the Special Option Grant will occur on the later of (i) the date the
Company becomes current in its reporting obligations under the Securities
Exchange Act of 1934; or (ii) the first date thereafter when the Form S8
Registration Statement for the Option Plan complies with the requirement of the
Securities Exchange Commission provided that you are still an employee on the
grant date.  The option price for the Special
Option Grant shall be equal at least to the fair market value of the Company’s
Common Stock as of the grant date.  The
Special Option Grant will be subject to all of the terms and conditions of the
Option Plan and the Stock Option Agreement that will be issued if and when the
grant becomes effective.  Your right to
exercise the option will vest in equal 20% installments on each of the first
five (5) anniversaries of the grant date. 
In the event of a “Change of
Control” (as defined below) of the Company while you are an employee, your Special
Option Grant may, from and after the
date which is six months after the Change of Control (but not beyond the
expiration date of the option), be exercised for up to 100% of the total number
of shares then subject to the Special Option Grant minus the number of shares
previously purchased upon exercise of such option (as adjusted for any change
in the outstanding shares of the Common Stock of the Company in accordance with
the terms of the Option Plan) and your vesting date will accelerate
accordingly.  A “Change of Control” shall
be deemed to have occurred upon the happening of any of the following events:

 

(i)                                     A
change within a twelve-month period in the holders of more than 50% of the
outstanding voting stock of the Company; or

 

2

 

(ii)                                  Any other event deemed to constitute a “Change
of Control” by the Company’s Board of Directors.

 

(2)  Contingent upon Employee’s continued
attainment of performance objectives, the Company agrees to deliver a long term
incentive value of $60,000 annually through one of the following, as determined
in the Company’s sole discretion: (i) a stock option grant pursuant to the
Option Plan, (ii) a restricted stock grant or (iii) a cash-based long
term incentive program to be developed. 
The long term incentive value of Company stock will be calculated based
on an industry accepted stock valuation methodology.  

 

3.  Employment-At-Will.  Nothing contained in this Agreement is
intended to create an employment relationship whereby Employee will be employed
other than as an “at-will” employee. 
Employee’s employment by the Company may be terminated by Employee or
the Company at any time; provided, however, that
while employed by the Company, the terms and conditions of Employee’s
employment by the Company will be as herein set forth; and provided
further, that Section 4 of this Agreement will survive
the termination of Employee’s employment.

 

4.  Covenants.

 

a.                                       Non-Solicitation.  While employed by the Company and for the
eighteen (18) month period following the cessation of that employment for any
reason (and without regard to whether such cessation was initiated by Employee
or the Company), Employee will not do any of the following without the prior
written consent of the Company:

 

(1)  solicit, entice or induce, either
directly or indirectly, any person, firm or corporation who or which is a
client or customer of the Company or any of its subsidiaries to become a client
or customer of any other person, firm or corporation;

 

(2)  influence or attempt to influence,
either directly or indirectly, any customer of the Company or its subsidiaries
to terminate or modify any written or oral agreement or course of dealing with
the Company or its subsidiaries (except in Employee’s capacity as an employee
of the Company); or

 

(3)  influence or attempt to influence,
either directly or indirectly, any person to terminate or modify any
employment, consulting, agency, distributorship, licensing or other similar relationship
or arrangement with the Company or its subsidiaries (except in Employee’s
capacity as an employee of the Company).

 

b.                                      Non-Disclosure.  Employee shall not use for Employee’s
personal benefit, or disclose, communicate or divulge to, or use for the direct
or indirect benefit of any person, firm, association or company other than
Company, any “Confidential Information,” which term shall mean any information
regarding the business methods, business policies, policies, procedures,
techniques, research or development projects or results, historical or
projected financial information, budgets, trade secrets, or other knowledge or
processes of, or developed by, Company or any other confidential

 

3

 

information relating to or dealing with the business operations of
Company, made known to Employee or learned or acquired by Employee while in the
employ of Company, but Confidential Information shall not include information
otherwise lawfully known generally by or readily accessible to the general
public.  The foregoing provisions of this
subsection shall apply during and after the period when the Employee is an
employee of the Company and shall be in addition to (and not a limitation of)
any legally applicable protections of Company interest in confidential
information, trade secrets, and the like. 
At the termination of Employee’s employment with Company, Employee shall
return to the Company all copies of Confidential Information in any medium,
including computer tapes and other forms of data storage.

 

c.                                       Non-Competition.  While employed by the Company and for the
eighteen (18) month period following the cessation of that employment for any
reason (and without regard to whether such cessation was initiated by Employee
or the Company), Employee shall not directly or indirectly engage in (as a
principal, shareholder, partner, director, officer, agent, employee, consultant
or otherwise) or be financially interested in any business which is involved in
business activities which are the same as or in direct competition with
business activities carried on by the Company, or being definitively planned by
the Company at the time of termination of Employee’s employment.  Nothing contained in this subsection shall
prevent Employee from holding for investment up to three percent (3%) of any
class of equity securities of a company whose securities are publicly traded on
a national securities exchange or in a national market system.

 

d.                                      Intellectual
Property & Company Creations.

 

(1)  Ownership.  All right, title and interest in and to any
and all ideas, inventions, designs, technologies, formulas, methods, processes,
development techniques, discoveries, computer programs or instructions (whether
in source code, object code, or any other form), computer hardware, algorithms,
plans, customer lists, memoranda, tests, research, designs, specifications,
models, data, diagrams, flow charts, techniques (whether reduced to written
form or otherwise), patents, patent applications, formats, test results,
marketing and business ideas, trademarks, trade secrets, service marks, trade
dress, logos, trade names, fictitious names, brand names, corporate names,
original works of authorship, copyrights, copyrightable works, mask works,
computer software, all other similar intangible personal property, and all
improvements, derivative works, know-how, data, rights and claims related to
the foregoing that have been or are conceived, developed or created in whole or
in part by the Employee (a) at any time and at any place that relates
directly or indirectly to the business of the Company, as then operated,
operated in the past or under consideration or development or (b) as a
result of tasks assigned to Employee by the Company (collectively, “Company
Creations”), shall be and become and remain the sole and exclusive property of
the Company and shall be considered “works made for hire” as that term is
defined pursuant to applicable statutes and law.

 

(2)  Assignment.  To the extent that any of the Company Creations
may not by law be considered a work made for hire, or to the extent that,
notwithstanding the foregoing, Employee retains any interest in or to the
Company Creations, Employee

 

4

 

hereby irrevocably assigns and transfers to the Company any and all
right, title, or interest that Employee has or may have, either now or in the
future, in and to the Company Creations, and any derivatives thereof, without
the necessity of further consideration. 
Employee shall promptly and fully disclose all Company Creations to the
Company and shall have no claim for additional compensation for Company
Creations.  The Company shall be entitled
to obtain and hold in its own name all copyrights, patents, trade secrets,
trademarks, and service marks with respect to such Company Creations.

 

(3)  Disclosure & Cooperation.  Employee shall keep and maintain adequate and
current written records of all Company Creations and their development by
Employee (solely or jointly with others), which records shall be available at
all times to and remain the sole property of the Company.  Employee shall communicate promptly and
disclose to the Company, in such form as the Company may reasonably request, all
information, details and data pertaining to any Company Creations.  Employee further agrees to execute and
deliver to the Company or its designee(s) any and all formal transfers and
assignments and other documents and to provide any further cooperation or
assistance reasonably required by the Company to perfect, maintain or otherwise
protect its rights in the Company Creations. 
Employee hereby designates and appoints the Company or its designee as
Employee’s agent and attorney-in-fact to execute on Employee’s behalf any
assignments or other documents deemed necessary by the Company to perfect,
maintain or otherwise protect the Company’s rights in any Company Creations.

 

e.                                       Acknowledgments.  Employee acknowledges that the Covenants are
reasonable and necessary to protect the Company’s legitimate business
interests, its relationships with its customers, its trade secrets and other
confidential or proprietary information. 
Employee further acknowledges that the duration and scope of the
Covenants are reasonable given the nature of this Agreement and the position
Employee holds or will hold within the Company. 
Employee further acknowledges that the Covenants are included herein to
induce the Company to enter into this Agreement and that the Company would not
have entered into this Agreement or otherwise employed or continued to employ
the Employee in the absence of the Covenants. 
Finally, Employee also acknowledges that any breach, willful or
otherwise, of the Covenants will cause continuing and irreparable injury to the
Company for which monetary damages, alone, will not be an adequate remedy.

 

f.                                         Enforcement.

 

(1)  If any court determines that the
Covenants, or any part thereof, is unenforceable because of the duration or
scope of such provision, that court will have the power to modify such provision
and, in its modified form, such provision will then be enforceable.

 

(2)  The parties acknowledge that
significant damages will be caused by a breach of any of the Covenants, but
that such damages will be difficult to quantify.  Therefore, the parties agree that if Employee
breaches any of the Covenants, liquidated damages will be paid by Employee in
the following manner:

 

5

 

(i)                                     any
Company stock options, stock appreciation rights, restricted stock units or
similar equity incentives then held by Employee, whether or not then vested,
will be immediately and automatically forfeited;

 

(ii)                                  any
shares of restricted stock issued by the Company, then held by Employee or her
permitted transferee and then subject to forfeiture will be immediately and
automatically forfeited; and

 

(iii)                                 any obligation of the
Company to provide severance pay or benefits (whether pursuant to Section 5
or otherwise) will cease.

 

(3)  In addition to the remedies specified
in Section 4(f)(2) and any other relief awarded by any court,
if Employee breaches any of the Covenants:

 

(i)                                   Employee
will be required to account for and pay over to the Company all compensation,
profits, monies, accruals, increments or other benefits derived or received by
Employee as a result of any such breach; and

 

(ii)                                the
Company will be entitled to injunctive or other equitable relief to prevent
further breaches of the Covenants by Employee.

 

(4)  If Employee breaches Section 4,
then the duration of the restriction therein contained will be extended for a
period equal to the period that Employee was in breach of such restriction.

 

5.  Termination.  Employee’s employment by the Company may be
terminated at any time.  Upon
termination, Employee will be entitled to the payment of accrued and unpaid
salary through the date of such termination. 
All salary, commissions and benefits will cease at the time of such
termination, subject to the terms of any benefit plans then in force or
enforceable under applicable law and applicable to Employee, and the Company
will have no further liability or obligation hereunder by reason of such
termination; provided, however, that subject
to Section 4(f)(2)(iii), if Employee’s employment is terminated by
the Company without Cause, Employee will be entitled to (a) continued
payment of her base salary (at the rate in effect upon termination) for a
period of 12 months; (b) a payment equal to the average of the last three
bonuses from the MedQuist Management Bonus Plan received by Employee.  In the event that there are not three full
years of employment, then the average of the last two years will apply.  If less than two years, the target bonus will
be paid; and notwithstanding the foregoing, no amount will be paid or benefit
provided under this Section 5 unless and until (x) Employee
executes and delivers a general release of claims against the Company and its
subsidiaries in a form prescribed by the Company, and (y) such release becomes
irrevocable.  Any severance pay or
benefits provided under this Section 5 will be in lieu of, not in
addition to, any other severance arrangement maintained by the Company.

 

6.  Miscellaneous.

 

a.                                       Other
Agreements.  Employee represents and
warrants to the Company that there are no restrictions, agreements or
understandings whatsoever to which

 

6

 

she is a party that would prevent or make unlawful her execution of
this Agreement, that would be inconsistent or in conflict with this Agreement
or Employee’s obligations hereunder, or that would otherwise prevent, limit or
impair the performance by Employee of her duties to the Company.

 

b.                                      Entire
Agreement; Amendment.  This Agreement
contains the entire agreement and understanding of the parties hereto relating
to the subject matter hereof, and merges and supersedes all prior and
contemporaneous discussions, agreements and understandings of every nature
relating to the employment of Employee by the Company.  This Agreement may not be changed or
modified, except by an agreement in writing signed by each of the parties
hereto.

 

c.                                       Waiver.  Any waiver of any term or condition hereof
will not operate as a waiver of any other term or condition of this
Agreement.  Any failure to enforce any
provision hereof will not operate as a waiver of such provision or of any other
provision of this Agreement.

 

d.                                      Governing
Law.  This Agreement shall be
governed by, and enforced in accordance with, the laws of the State of New
Jersey without regard to the application of the principles of conflicts of
laws.

 

e.                                       Severability.  Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in
any jurisdiction, such invalidity, illegality or unenforceability will not
affect any other provision or the effectiveness or validity of any provision in
any other jurisdiction, and this Agreement will be reformed, construed and
enforced in such jurisdiction as if such invalid, illegal or unenforceable
provision had never been herein contained.

 

f.                                         Wage
Claims.  The parties intend that all
obligations to pay compensation to Employee be obligations solely of the
Company.  Therefore, intending to be
bound by this provision, Employee hereby waives any right to claim payment of
amounts owed to her, now or in the future, from directors or officers of the
Company in the event of the Company’s insolvency.

 

g.                                      Successors
and Assigns.  This Agreement is
binding on the Company’s successors and assigns.

 

h.                                      Section Headings.  The section headings in this Agreement
are for convenience only; they form no part of this Agreement and will not
affect its interpretation.

 

i.                                          Counterparts.  This Agreement may be executed in multiple
counterparts, each of which will be deemed to be an original and all of which
together will constitute but one and the same instrument.

 

7

 

j.                                          Indemnification.  Employee shall be indemnified for acts
performed in good faith as an officer, director or employee of the Company in
the manner provided in the Company’s charter and by-laws, and shall be covered
by director and officer liability insurance coverage for such acts to the same
extent that any such coverage is provided to the Company’s executive officers.

 

7.                                       Definitions.  Capitalized terms used herein will have the
meanings below defined:

 

a.                                       “Business”
means electronic transcription services and other health information management
solutions services businesses in which the Company or its subsidiaries are
engaged anywhere within the United States.

 

b.                                      “Cause”
means the occurrence of any of the following: 
(1) Employee’s refusal, willful failure or inability to perform
(other than due to illness or disability) her employment duties or to follow
the lawful directives of her superiors; (2) misconduct or gross negligence
by Employee in the course of employment; (3) conduct of Employee involving
any type of disloyalty to the Company or its subsidiaries, including, without
limitation: fraud, embezzlement, theft or dishonesty in the course of
employment; (4) a conviction of or the entry of a plea of guilty or nolo contendere to a crime involving moral turpitude or
that otherwise could reasonably be expected to have an adverse effect on the
operations, condition or reputation of the Company, (5) a material breach
by Employee of any agreement with or fiduciary duty owed to the Company; or (6) alcohol
abuse or use of controlled drugs other than in accordance with a physician’s
prescription.

 

c.                                       “Covenants”
means the covenants set forth in Section 4 of this Agreement.

 

To acknowledge your agreement to and acceptance of the
terms and conditions of this Agreement, please sign below in the space provided
within five (5) days of the date of this Agreement and return a signed
copy to my attention.  If the Agreement
is not signed and returned within (5) days, the terms and conditions of
this Agreement will be deemed withdrawn.

 

	
   

  	
  Sincerely,

  
	
   

  	
   

  
	
   

  	
  MEDQUIST INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Frank W. Lavelle

  
	
   

  	
   

  	
  President

  
	
   

  	
   

  
	
  Accepted and Agreed:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Kathleen Donovan

  	
   

  
						

 

8EXHIBIT 10.1

 

FIRST AMENDMENT TO CREDIT
AGREEMENT

 

THIS FIRST AMENDMENT TO CREDIT AGREEMENT
(this “First Amendment”), dated as of April 22, 2005, by and among
the lenders listed on the signature pages hereof as Lenders (the “Lenders”),
DYNAMEX INC., a Delaware corporation (the “Borrower”), DYNAMEX
OPERATIONS EAST, INC., a Delaware corporation, DYNAMEX OPERATIONS WEST, INC., a
Delaware corporation, ROAD RUNNER TRANSPORTATION, INC., a Minnesota
corporation, NEW YORK DOCUMENT EXCHANGE CORPORATION, a New York corporation,
DYNAMEX DEDICATED FLEET SERVICES, INC., a Delaware corporation, DYNAMEX CANADA
HOLDINGS, INC., a Delaware corporation, DYNAMEX PROVINCIAL COURIERS, INC., a
Delaware corporation, BANK OF AMERICA, N.A., in its capacity as a lender (the “Lender”),
and BANK OF AMERICA, N.A., as administrative agent for itself and the Lender
(in such capacity, the “Administrative Agent”).

 

BACKGROUND

 

The Borrower, the other Loan
Parties (as defined in the Credit Agreement defined below), the Lender and the
Administrative Agent are parties to that certain Credit Agreement, dated as of March 2,
2004 (the “Credit Agreement”; the terms defined in the Credit Agreement and not
otherwise defined herein shall be used herein as defined in the Credit
Agreement).

The Borrower has requested
certain amendments to the Credit Agreement.

The Borrower, the Lender and
the Administrative Agent hereby agree to amend the Credit Agreement, subject to
the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the
covenants, conditions and agreements hereafter set forth, and for other good
and valuable consideration, the receipt and adequacy of which are all hereby
acknowledged, the parties hereto covenant and agree as follows:

 

AMENDMENTS.  

 

The definition of “Applicable Margin” set forth in Section 1.1
of the Credit Agreement is hereby amended to read as follows:

 

“Applicable
Margin” means the following percentages per annum, based upon the ratio of
Funded Debt to EBITDA as set forth in the most recent Compliance Certificate
received by the Administrative Agent pursuant to Section 8.1(c):

 

	
  Pricing 

  Level

  	
   

  	
  Ratio of Funded Debt to

  EBITDA

  	
   

  	
  Commitment

  Fee

  	
   

  	
  Eurodollar Loans

  Letters of Credit

  	
   

  	
  ABR

  Loans

  	
   

  
	
  1

  	
   

  	
  Less than 1.00 to 1.00

  	
   

  	
  0.200

  	
   

  	
  1.000

  	
   

  	
  0.000

  	
   

  
	
  2

  	
   

  	
  Greater than or equal to 1.00 to 1.00 but
  less than 1.50 to 1.00

  	
   

  	
  0.250

  	
   

  	
  1.250

  	
   

  	
  0.000

  	
   

  
	
  3

  	
   

  	
  Greater than or equal to 1.50 to 1.00

  	
   

  	
  0.300

  	
   

  	
  1.500

  	
   

  	
  0.000

  	
   

  

 

Any increase
or decrease in the Applicable Margin resulting from a change in the ratio of
Funded Debt to EBITDA shall become effective as of the first Business Day 

 

 

immediately following the end of the
compliance period for which a Compliance Certificate is delivered pursuant to Section 8.1(c);
provided, however, that if a Compliance Certificate is not
delivered when due in accordance with such Section, then Pricing Level 3
shall apply as of the first Business Day after the date on which such
Compliance Certificate was required to be have been delivered.  The Applicable Margin from and after the
First Amendment Effective Date through the date on which another Pricing Level
would otherwise be in effect based on the Compliance Certificate of the
Borrower shall be Pricing Level 1.

 

The definition of “Availability Period” set forth in Section 1.1
of the Credit Agreement is hereby amended to read as follows:

 

“Availability
Period” means any Business Day from the date hereof to the earliest of (a) the
Maturity Date, (b) the date of termination of the Commitments pursuant to Section 2.12,
and (c) the date of termination of the Commitments pursuant to Section 11.2(b).

 

The definition of “Commitment” set forth in Section 1.1
of the Credit Agreement is hereby amended to read as follows:

 

“Commitment”
means, as to any Lender, the obligation of such Lender to make Loans and incur
or participate in Letter of Credit Liabilities hereunder in an aggregate
principal amount at any one time outstanding up to but not exceeding the amount
set forth opposite the name of such Lender on the signature pages hereto
(or any amendment to the Credit Agreement) under the heading “Commitment” or,
if such Lender is a party to an Assignment and Acceptance, the amount of the “Commitment”
set forth in the most recent Assignment and Acceptance of such Lender, as the
same may be reduced or terminated pursuant to Section 2.12 or 11.2,
and “Commitments” means such obligations of all Lenders.  As of the First Amendment Effective Date, the
aggregate principal amount of the Commitment is $15,000,000.

 

The defined term “Maturity Date” set forth in Section 1.1
of the Credit Agreement is hereby amended to read as follows:.

 

“Maturity
Date” means November 30, 2008.

 

The definition of “Permitted Acquisition” set forth in
Section 1.1 of the Credit Agreement is hereby amended to read as
follows:

 

“Permitted
Acquisition” means any Future Acquisition that complies with each of the
following requirements:

 

(a)                                  such
Future Acquisition consists of (i) an acquisition of assets in the United
States by a Loan Party that is organized under the laws of a State of the U.S.
or (ii) an acquisition of Capital Stock by the Borrower, which Capital
Stock has been issued by an entity organized under the laws of a State of the
U.S. or (iii) an acquisition of assets located in Canada or Capital Stock
of a Person organized under the laws of Canada by any of the Canadian
Subsidiaries;

 

2

 

(b)                                 the
business, Properties or Person acquired in such Future Acquisition are
consistent with the requirements of Section 9.10;

 

(c)                                  both
before and after giving effect to such Future Acquisition and the Loans
requested to be made in connection therewith, no Default exists or will exist
and the Borrower shall have represented pro forma compliance with the financial
covenants contained in Article 10 of this Agreement for the most
recent twelve-month period and as of the end of the most recent fiscal quarter
after giving effect to such Future Acquisition;

 

(d)                                 the
Loan Parties shall not, as a result of or in connection with any such Future
Acquisition, assume or incur any contingent liabilities (whether relating to
environmental, tax, litigation or other matters) that could reasonably be
expected to result in the existence or occurrence of a Material Adverse Effect;

 

(e)                                  if
such Future Acquisition is effectuated pursuant to a merger, consolidation,
amalgamation or wind-up, the Borrower (if the Borrower is a party thereto) or
the Wholly-Owned Subsidiary (if such Wholly-Owned Subsidiary is a party thereto
and the Borrower is not a party thereto) shall be the Person surviving such
merger, consolidation, amalgamation or wind-up; and

 

(f)                                    such
Future Acquisition shall have been approved by all requisite corporate (or
other applicable entity) action (including, without limitation, shareholder or
other owner action, if required) of the target entity or Acquired Entity (as
applicable) required by applicable law and shall not have been disapproved or
recommended for disapproval by the board of directors or analogous governing
body of such target entity or Acquired Entity (as applicable).

 

The defined term “First Amendment” is hereby added to Section 1.1
of the Credit Agreement in proper alphabetical order to read as follows:

 

“First
Amendment” means that certain First Amendment to Credit Agreement, dated as
of April 22, 2005, among the Borrower, the Lender and the Administrative
Agent.

 

The defined term “First Amendment Effective Date” is
hereby added to Section 1.1 of the Credit Agreement in proper
alphabetical order to read as follows:

 

“First
Amendment Effective Date” means the date that all of the conditions to
effectiveness set forth in Section 3 of the First Amendment have been
satisfied.

 

Clause (i) of Section 9.5 of the Credit
Agreement is hereby amended to read as follows:

 

(i)                                     Investments
by the Borrower or its Subsidiary in companies whose Capital Stock or assets
are proposed to be purchased or acquired by the Borrower or such Subsidiary in
accordance with clause (ii) of Section 9.3; and

 

3

 

Section 10.4 of the Credit Agreement is
hereby amended to read as follows:

 

[Intentionally
Omitted.]

 

4

 

Exhibit G, the Form of
Compliance Certificate, is hereby amended to be in the form of Exhibit G
hereto.

 

REPRESENTATIONS AND WARRANTIES TRUE; NO EVENT OF
DEFAULT.  By its execution and delivery
hereof, the Borrower represents and warrants that, as of the date hereof, after
taking into account the effectiveness of this First Amendment:

 

the representations and warranties contained in the Credit
Agreement and the other Loan Documents are true and correct on and as of the
date hereof as made on and as of such date;

 

no event has occurred and is continuing which constitutes a
Default or an Event of Default;

 

(i) the Borrower has full power and authority to execute
and deliver this First Amendment, the replacement Revolving Loan Note for the
Lender (the “Replacement Revolving Loan Note”), (ii) this First
Amendment and the Replacement Note have been duly executed and delivered by the
Borrower, and (iii) this First Amendment and the Replacement Note and the
Credit Agreement, as amended hereby, constitute the legal, valid and binding
obligations of the Borrower, enforceable in accordance with their respective
terms, except as enforceability may be limited by applicable debtor relief laws
and by general principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and except as rights to indemnity
may be limited by federal or state securities laws;

 

neither the execution, delivery and performance of this First
Amendment, the Replacement Note or the Credit Agreement, as amended hereby, nor
the consummation of any transactions contemplated herein or therein, will
conflict with any Law or organizational documents of the Borrower, or any
indenture, agreement or other instrument to which the Borrower or any of its
property is subject; and

 

no authorization, approval, consent, or other action by,
notice to, or filing with, any governmental authority or other Person not
previously obtained is required for the execution, delivery or performance by
the Borrower of this First Amendment or the Replacement Note.

 

CONDITIONS OF EFFECTIVENESS.  This First Amendment shall be effective upon
satisfaction of the following conditions:

 

the representations and warranties set forth in Section 2
of this First Amendment shall be true and correct;

 

the Administrative Agent shall have received counterparts of
this First Amendment executed by the Lenders;

 

5

 

the Administrative Agent shall have received counterparts of
this First Amendment executed by the Borrower and acknowledged by each Loan
Party;

 

the Administrative Agent shall have received duly executed
Replacement Note for the Lender; and

 

the Administrative Agent shall have received in form and
substance satisfactory to the Administrative Agent, such other documents,
certificates and instruments as the Lenders shall require.

 

LOAN PARTY’S ACKNOWLEDGMENT.  By signing below, each Loan Party (i) acknowledges,
consents and agrees to the execution, delivery and performance by the Borrower
of this First Amendment, (ii) acknowledges and agrees that its obligations
in respect of the Loan Documents to which it is a party are not released, diminished,
waived, modified, impaired or affected in any manner by this First Amendment,
or any of the provisions contemplated herein, (iii) ratifies and confirms
its obligations under the Loan Documents to which it is a party, and (iv) acknowledges
and agrees that it has no claim or offsets against, or defenses or
counterclaims to, its obligations under the Loan Documents to which it is a
party.

 

RELEASE.  IN CONSIDERATION OF THE LENDER’S
EXECUTION OF THIS FIRST AMENDMENT, EACH OF THE LOAN PARTIES, IN EACH CASE ON
BEHALF OF ITSELF AND EACH OF THEIR SUCCESSORS AND ASSIGNS (COLLECTIVELY, THE “RELEASORS”),
DOES VOLUNTARILY AND KNOWINGLY RELEASE AND FOREVER DISCHARGE EACH LENDER, EACH
EXITING LENDER AND ADMINISTRATIVE AGENT AND THEIR RESPECTIVE PREDECESSORS, OFFICERS,
DIRECTORS, EMPLOYEES, AGENTS, SUCCESSORS AND ASSIGNS (EACH, A “RELEASED PARTY”)
FROM ALL POSSIBLE CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS,
EXPENSES, AND LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR
UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL, AT
LAW OR IN EQUITY, ARISING ON OR BEFORE THE DATE THIS FIRST AMENDMENT IS
EXECUTED, WHICH BORROWER OR ANY LOAN PARTY MAY NOW HAVE AGAINST ANY
RELEASED PARTY, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS ARISE OUT
OF CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR OTHERWISE, AND ARISING
FROM ANY “OBLIGATIONS”, INCLUDING, WITHOUT LIMITATION, ANY CONTRACTING FOR,
CHARGING, TAKING, RESERVING, COLLECTING OR RECEIVING INTEREST IN EXCESS OF THE
HIGHEST LAWFUL RATE APPLICABLE, THE EXERCISE OF ANY RIGHTS AND REMEDIES UNDER
THE CREDIT AGREEMENT OR OTHER LOAN DOCUMENTS, AND NEGOTIATION FOR AND EXECUTION
OF THIS FIRST AMENDMENT.

 

REFERENCE TO THE CREDIT AGREEMENT.

 

Upon and during the effectiveness of this First
Amendment, each reference in the Credit Agreement to “this Agreement”, “hereunder”,
or words of like import shall mean and be a reference to the Credit Agreement,
as affected by this First Amendment.

 

Except as expressly set forth herein, this First
Amendment shall not by implication or otherwise limit, impair, constitute a
waiver of, or otherwise affect the rights or remedies of the Administrative
Agent or the Lenders under the Credit Agreement or any of the other Loan
Documents, and shall not alter, modify, amend, or in any way affect the terms,
conditions, obligations, covenants, or agreements contained in the Credit
Agreement or the other Loan Documents, all of which are hereby ratified and
affirmed in all respects and shall continue in full force and effect.

 

6

 

COSTS AND EXPENSES. 
The Borrower shall be obligated to pay the costs and expenses of the
Administrative Agent in connection with the preparation, reproduction,
execution and delivery of this First Amendment and the other instruments and
documents to be delivered hereunder.

 

EXECUTION IN COUNTERPARTS.  This First Amendment may be executed in any
number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed to
be an original and all of which when taken together shall constitute but one
and the same instrument.  For purposes of
this First Amendment, a counterpart hereof (or signature page thereto)
signed and transmitted by any Person party hereto to the Administrative Agent
(or its counsel) by facsimile machine, telecopier or electronic mail is to be
treated as an original.  The signature of
such Person thereon, for purposes hereof, is to be considered as an original
signature, and the counterpart (or signature page thereto) so transmitted
is to be considered to have the same binding effect as an original signature on
an original document.

 

GOVERNING LAW; BINDING EFFECT.  This First Amendment shall be governed by and
construed in accordance with the laws of the State of Texas (without giving
effect to conflict of laws) and the United States of America, and shall be
binding upon the Borrower and each Lender and their respective successors and
assigns.

 

HEADINGS.  Section headings
in this First Amendment are included herein for convenience of reference only
and shall not constitute a part of this First Amendment for any other purpose.

 

ENTIRE AGREEMENT.  THE CREDIT
AGREEMENT, AS AMENDED BY THIS FIRST AMENDMENT, AND THE OTHER LOAN DOCUMENTS
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AS TO THE SUBJECT MATTER
THEREIN AND HEREIN AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES.

 

REMAINDER OF PAGE LEFT INTENTIONALLY
BLANK

 

7

 

IN WITNESS WHEREOF, the parties hereto have
executed this First Amendment as of the date first above written.

 

	
   

  	
  DYNAMEX INC.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Ray Schmitz

  
	
   

  	
   

  	
   Name:

  	
   Ray Schmitz

  
	
   

  	
   

  	
   Title:

  	
   VP - CFO

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  DYNAMEX OPERATIONS EAST, INC.

  
	
   

  	
  DYNAMEX OPERATIONS WEST, INC.

  
	
   

  	
  ROAD RUNNER TRANSPORTATION, INC.

  
	
   

  	
  NEW YORK DOCUMENT EXCHANGE

  
	
   

  	
  CORPORATION

  
	
   

  	
  DYNAMEX
  DEDICATED FLEET SERVICES,

  INC.

  
	
   

  	
  DYNAMEX CANADA HOLDINGS, INC.

  
	
   

  	
  DYNAMEX PROVINCIAL COURIERS, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Ray Schmitz

  
	
   

  	
   

  	
   Name:

  	
   Ray Schmitz

  
	
   

  	
   

  	
   Title:

  	
   VP - CFO

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  ADMINISTRATIVE AGENT:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A.,

  
	
   

  	
  as Administrative Agent

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Michael F. Murray

  
	
   

  	
   

  	
   Name:

  	
   Michael F. Murray

  
	
   

  	
   

  	
   Title:

  	
   Vice President

  
						

 

8

 

	
   

  	
  LENDER:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A.

  
	
  COMMITMENT:

  	
  $15,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Michael F. Murray

  
	
   

  	
   

  	
   Name:

  	
   Michael F. Murray

  
	
   

  	
   

  	
   Title:

  	
   Vice President

  
						

 

9

 

EXHIBIT G

 

FORM OF COMPLIANCE
CERTIFICATE

 

 

COMPLIANCE
CERTIFICATE

 

FOR
              
ENDED
                        ,
200   (THE “SUBJECT PERIOD”)

 

 

Date:
                        ,
200  

 

Bank of America, N.A., as Administrative Agent

901 Main Street, 7th Floor

Dallas, Texas 75202

Attention: Dallas Commercial Banking

 

Re:                               Dynamex
Inc.

 

Reference is made to that certain Credit
Agreement dated as of March 2, 2004 (as the same maybe amended and in
effect from time to time, the “Credit Agreement”), among Dynamex Inc.
(the “Borrower”) and certain of its Subsidiaries, the lenders named
therein (the “Lenders”) and Bank of America, N.A., as Administrative
Agent for the Lenders (in such capacity, the “Administrative Agent”).  Capitalized terms used herein and not
otherwise defined herein shall have the meanings assigned to such terms in the
Credit Agreement.

 

The undersigned hereby certifies to the
Administrative Agent and the Lenders that, on the date of this Certificate, (a) I
am a Responsible Officer of the Borrower and each of its Subsidiaries, (b) the
financial statements of the Borrower and its Subsidiaries attached to this
Certificate were prepared in accordance with GAAP and present fairly the
consolidated and (where applicable) consolidating financial condition and
results of operations of the Borrower and its Subsidiaries as of the end of and
for the Subject Period, (c) a review of the activities of each of the
Borrower and its Subsidiaries during the Subject Period has been made under my
supervision with a view to determining whether, during the Subject Period, each
of the Borrower and its Subsidiaries have kept, observed, performed and
fulfilled all of its covenants, agreements and other obligations under the Loan
Documents, (d) during the Subject Period, each of the Borrower and its
Subsidiaries has kept, observed, performed and fulfilled each and every
covenant, agreement and other obligation under the Loan Documents (except for
the deviations, if any, set forth on a schedule annexed to this
Certificate) and no Default or Event of Default has occurred during the Subject
Period or otherwise has occurred or exists which has not been cured or waived
(except the Default or Event of Default, if any, described on the schedule annexed
to this Certificate), and (e) the status of compliance by each of the
Borrower and its Subsidiaries with certain covenants contained in the Credit
Agreement for the Subject Period is as set forth below:

 

E-1

 

	
   

  	
   

  	
  In Compliance for

  the Subject Period

  (Please Indicate)

  
	
  1) Financial Statements and Reports (Section 8.1)

  	
   

  	
   

  	
   

  	
   

  
	
  (a)           Provide
  annual audited fiscal year end consolidated (with unaudited consolidating
  schedules attached) financial statements within 90 days of each fiscal year
  end, as required by Section 8.1(a) of the Credit Agreement.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  (b)           Provide
  quarterly unaudited consolidated financial statements within 45 days of each
  fiscal quarter end (for first, second and third fiscal quarters only), as
  required by Section 8.1(b) of the Credit Agreement.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  (c)           Provide
  Compliance Certificate concurrently with the delivery of the annual and
  quarterly financial statements referred to in clauses (a) and (b) of
  Section 8.1 of the Credit Agreement, as required by Section 8.1(c) of
  the Credit Agreement.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  (d)           Provide
  fiscal year budget before the beginning of each fiscal year, as required by Section 8.1(d) of
  the Credit Agreement.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  (e)           Concurrently
  with the delivery of the annual and quarterly financial statements referred
  to in clauses (a) and (b) of Section 8.1
  of the Credit Agreement, provide certificate setting forth certain
  information regarding the Collateral, as required by

  Section 8.1(l)(i) of the Credit Agreement.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  (f)            Provide
  a report summarizing all material insurance coverage within 60 days prior to
  each fiscal year end, as required by Section 8.1(n) of the Credit
  Agreement.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  (g)           Provide
  other reports and information (including, without limitation, management
  letters, information regarding litigation and Defaults) required by Section 8.1
  as and when required.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  2)             Debt
  Covenant (Section 9.1)

  None, except for Debt permitted by Section 9.1. Specify amount of
  Debt for borrowed money incurred during the Subject Period:
  $                    

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  3)             Liens
  Covenant (Section 9.2)

  None, except for Liens permitted by Section 9.2.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  4)             Mergers,
  Etc. Covenant (Section 9.3)

  None, except as permitted by Section 9.3. Disclose on an attached
  schedule mergers, dissolutions, liquidations and acquisitions
  consummated during the Subject Period.

  	
   

  	
  Yes

  	
   

  	
  No

  

 

E-2

 

	
   

  	
   

  	
  In Compliance for

  the Subject Period

  (Please Indicate)

  
	
  5)             Restricted
  Payments Covenant (Section 9.4)

  None, except as permitted by Section 9.4. Specify amount of any
  dividends paid by the Borrower or any payments of principal of Subordinated
  Debt paid during the Subject Period:
  $                .

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  6)             Investments
  Covenant (Section 9.5)

  None, except as permitted by Section 9.5.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  7)             Limitation
  on Issuance of Capital Stock of Subsidiaries (Section 9.6)

  None, except as permitted by Section 9.6. Disclose on an attached
  schedule any Capital Stock of Subsidiaries issued during the Subject
  Period.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  8)             Transactions
  with Affiliates (Section 9.7)

  None, except as permitted by Section 9.7.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  9)             Disposition
  of Property (Section 9.8)

  None, except as permitted by Section 9.8.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  10)           Sale
  and Leaseback (Section 9.9)

  None permitted.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  11)           Lines
  of Business (Section 9.10)

  No changes except as permitted by Section 9.10.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  12)           Environmental
  Protection Covenant (Section 9.11).

  The Loan Parties do not conduct their operations outside the limits set forth
  in Section 9.11 of the Credit Agreement.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  13)           Intercompany
  Transactions Covenant (Section 9.12).

  None except as permitted by Section 9.12 of the Credit Agreement.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  14)           Modification
  of Other Agreements (Section 9.13)

  None, except as permitted by Section 9.13.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  15)           Deposit
  Accounts (Section 9.14)

  None to be created or maintained except as permitted by Section 9.14.
  Disclose on an attached schedule any new deposit accounts opened during
  the Subject Period.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  16)           ERISA
  and Canadian Plans (Section 9.15).

  Do not fail to maintain Plans as required in Section 9.15 of the
  Credit Agreement.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  17)           Activities
  of Certain Canadian Subsidiaries (Section 9.16).

  None as to Restricted Subsidiaries except as permitted by Section 9.16
  of the Credit Agreement.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  18)           Maximum
  Ratio of Funded Debt to EBITDA (Section 10.1)

  Must be equal to or less than 2.00 to 1.00

  	
   

  	
   

  	
   

  	
   

  
	
  (a)           Funded
  Debt:

  	
  $

  	
                      

  	
   

  	
   

  	
   

  	
   

  
	
  (b)           EBITDA:

  	
  $

  	
                      

  	
   

  	
   

  	
   

  	
   

  

 

E-3

 

	
   

  	
   

  	
  In Compliance for

  the Subject Period

  (Please Indicate)

  
	
  (c)           Ratio:

  	
              
  to 1.00

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  19)           Minimum
  Net Worth (Section 10.2)

  Must be equal to or greater than the sum of (a) $45,000,000, plus
  (b) 75% of cumulative Net Income, if positive for any fiscal quarter
  (i.e., exclusive of any negative Net Income for any fiscal quarter), for any
  fiscal quarter commencing on and after May 1, 2003, plus (c) all
  Net Proceeds of each Equity Issuance which occurs on or after January 1,
  2003.

  	
   

  	
  Yes

  	
   

  	
  No

  
	
  20)           Fixed
  Charge Coverage Ratio (Section 10.3)

  Must be equal to or greater than: 1.50 to 1.00

  	
   

  	
   

  	
   

  	
   

  
	
  (a)           (i)            Net
  Income:

  	
  $

  	
                

  	
   

  	
   

  	
   

  	
   

  
	
  (ii)           plus
  Interest Expense

  	
  $

  	
                

  	
   

  	
   

  	
   

  	
   

  
	
  (iii)          plus
  income and franchise taxes

  	
  $

  	
                

  	
   

  	
   

  	
   

  	
   

  
	
  (iv)          plus
  depreciation and amortization expense and other non-cash items

  	
  $

  	
                

  	
   

  	
   

  	
   

  	
   

  
	
  (v)           minus
  non-cash income

  	
  $

  	
                

  	
   

  	
   

  	
   

  	
   

  
	
  (vi)          plus
  Lease Expense

  	
  $

  	
                

  	
   

  	
   

  	
   

  	
   

  
	
  (vii)         minus
  Capital Expenditures

  	
  $

  	
                

  	
   

  	
   

  	
   

  	
   

  
	
  (viii)        minus
  Dividends

  	
  $

  	
                

  	
   

  	
   

  	
   

  	
   

  
	
  (ix)           minus
  Treasury Stock Purchases

  	
  $

  	
                

  	
   

  	
   

  	
   

  	
   

  
	
  (x)            Total:

  	
  $

  	
                

  	
   

  	
   

  	
   

  	
   

  
	
  (b)           Fixed
  Charges:

  	
  $

  	
                

  	
   

  	
   

  	
   

  	
   

  
	
  (c)           Ratio:

  	
              
  to 1.00

  	
   

  	
  Yes

  	
   

  	
  No

  
								

 

E-4

 

	
   

  	
  DYNAMEX INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  

 

E-5

 

[Schedules
to be attached if applicable.]

 

E-6

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