Document:

Exhibit
10.10

 

SECOND
AMENDMENT AND CONSENT

 

SECOND AMENDMENT AND
CONSENT, dated as of May 30, 2003 (this “Second Amendment”), to the
Note Purchase Agreement, dated as of April 30, 2001 (as amended, supplemented
or otherwise modified prior to the date hereof, the “Existing Note Agreement”;
as modified hereby and as further amended, supplemented or otherwise modified
from time to time, the “Note Agreement”), by and among ADVANTAGE
MANAGEMENT GROUP, INC., an Ohio corporation (“AMG”), and KENAN TRANSPORT
COMPANY, a North Carolina corporation (“Kenan” and together with AMG
collectively, the “Company”), THE KENAN ADVANTAGE GROUP, INC., a
Delaware corporation (the “Parent”), RSTW PARTNERS III, L.P., a Delaware
limited partnership (“RSTW”), MASSACHUSETTS MUTUAL LIFE INSURANCE
COMPANY, a mutual life insurance company established under the laws of the
Commonwealth of Massachusetts (“MMLI”), MASSMUTUAL CORPORATE INVESTORS,
a Massachusetts business trust (“MCI”), and MASSMUTUAL PARTICIPATION
INVESTORS, a Massachusetts business trust (“MPI”).  MMLI, MCI and MPI are hereinafter referred
to, collectively, as the “MassMutual Investors”. RSTW and the MassMutual
Investors are collectively referred to herein as the “Purchasers”.

 

RECITALS

 

The Company and the
Parent have requested the Purchasers to agree to amend certain provisions of
the Existing Note Agreement as set forth in this Second Amendment.  The Purchasers parties hereto are willing to
agree to such amendments, but only on the terms and subject to the conditions
set forth in this Second Amendment.

 

NOW, THEREFORE, in
consideration of the premises and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Company, the
Parent, and the Purchasers hereby agree as follows:

 

1.             Defined Terms. 
Unless otherwise defined herein, terms defined in the Note Agreement are
used herein as therein defined, including terms defined in the Note Agreement
amended by this Second Amendment.

 

2.             Amendments.

 

(a)           The Recitals of the Existing Note
Agreement are hereby amended by inserting the following new paragraph after the
sixth paragraph of the Recitals, to read as follows:

 

“WHEREAS, the Company has
requested that the Purchasers amend this Agreement to provide for, among other
things, the Beneto Acquisition and the Klemm Acquisition.”

 

(b)           Section 4.16 of the Existing Note
Agreement is hereby deleted and a new Section 4.16 is hereby substituted in
lieu thereof, to read in its entirety as follows:

 

 

“4.16       Subsidiaries and Capitalization.  As of the Initial Second Amendment Closing
Date and after giving effect to the applicable B-K Acquisitions, the Company
has no Subsidiaries except as described in Schedule 4.16A.  As of the Final Second Amendment Closing
Date and after giving effect to the applicable B-K Acquisitions, the Company
has no Subsidiaries except as described in Schedule 4.16B.  All the issued and outstanding shares of
capital stock of each Credit Party are duly authorized, validly issued, fully
paid and nonassessable.  The capitalization,
and the identity of the holders (and respective holdings) of all of the issued
and outstanding capital stock of each Credit Party, both prior to and after the
Final Second Amendment Closing Date, after giving effect to the transactions
contemplated by the Acquisition Documents, and the amounts of each on an
outstanding basis and a fully-diluted basis, are set forth on Schedule 4.16C.  No violation of any preemptive rights of
shareholders of any of the Credit Parties has occurred by virtue of the
transactions contemplated under this Agreement, the Acquisition Documents, the
Senior Loan Documents or any Other Agreement. 
There are no outstanding contracts, options, warrants, instruments,
documents or agreements binding upon any of the Credit Parties granting to any
Person or group of Persons any right to purchase or acquire shares of any of
the Credit Parties’ capital stock, except for those listed on Schedule 4.16C.”

 

(c)           Article IV of the Existing Note
Agreement is hereby amended by adding at the end thereof a new Section 4.27, to
read in its entirety as follows:

 

“4.27       Application to B-K Acquisitions.  (a) 
Each of the Company and the Parent hereby represents and warrants on
each applicable Second Amendment Closing Date immediately prior to the consummation
of the applicable B-K Acquisition that each of the foregoing representations
and warranties (as updated pursuant to Section 2 of the Second Amendment) other
than the representations and warranties contained in Sections 4.1, 4.2(c) and
(d), 4.3, 4.6, 4.7, 4.8, 4.11, 4.15, 4.20, 4.22, 4.24, and each of the
representations set forth in Section 7 of the Second Amendment, would be true
and correct in all material respects on such date immediately after giving
effect to such B-K Acquisition.

 

(b)           None of the representations and
warranties made by or in respect of any Credit Party in this Article IV or in
the Second Amendment regarding the B-K Acquisitions, the Beneto Business, the
Klemm Business, Beneto, Beneto LLC or Klemm shall be construed by any Person to
be a consent to or acknowledgement of the accuracy or completeness of any
representations or warranties contained in any Beneto Acquisition Document,
Klemm Acquisition Document, or to be a waiver of any rights or remedies of any
Credit Party or any Affiliate or Subsidiary of any thereof under or in respect
of the Beneto Acquisition Documents or Klemm Acquisition Documents as against
any other Person, whether pursuant to such Beneto Acquisition Documents or
Klemm Acquisition Documents, under applicable law, or otherwise.”

 

(d)           Section 6.23 of the Existing Note
Agreement is hereby amended by deleting paragraph (a) thereof in its entirety
and substituting in lieu thereof the following new Section 6.23(a) to read as
follows:

 

2

 

“(a)         Maximum Leverage Ratio. The
Company and the other Credit Parties will at all times maintain a Leverage
Ratio of the Credit Parties as of the last day of any fiscal quarter of the
Parent ending during any test period set forth on the table below not to exceed
the ratio set forth opposite such test period below:

 

	
  Test Period

  	
   

  	
  Ratio

  	
   

  
	
  Closing Date to December 30, 2001

  	
   

  	
  4.40
  to 1.00

  	
   

  
	
  December 31, 2001 to June 29, 2002

  	
   

  	
  4.02
  to 1.00

  	
   

  
	
  June 30, 2002 to September 29, 2002

  	
   

  	
  3.85
  to 1.00

  	
   

  
	
  September 30, 2002 to September 29, 2003

  	
   

  	
  3.96
  to 1.00

  	
   

  
	
  September 30, 2003 to December 30, 2003

  	
   

  	
  3.80 to 1.00

  	
   

  
	
  December 31, 2003 to June 29, 2004

  	
   

  	
  3.69 to 1.00

  	
   

  
	
  June 30, 2004 to September 29, 2004

  	
   

  	
  3.58
  to 1.00

  	
   

  
	
  September 30, 2004 to December 30, 2004

  	
   

  	
  3.47
  to 1.00

  	
   

  
	
  December 31, 2004 to June 29, 2005

  	
   

  	
  3.30
  to 1.00

  	
   

  
	
  June 30, 2005 to September 29, 2005

  	
   

  	
  3.03
  to 1.00

  	
   

  
	
  September 30, 2005 to December 30, 2005

  	
   

  	
  2.92
  to 1.00

  	
   

  
	
  December 31, 2005 to September 29, 2006

  	
   

  	
  2.75
  to 1.00

  	
   

  
	
  September 30, 2006 to and thereafter

  	
   

  	
  2.48
  to 1.00

  	
   

  

 

(e)           Section 6.23 of the Existing Note
Agreement is hereby amended by adding paragraph (d) to read as follows:

 

“(d)  Limitation on Operating Leases.               The Company and the other Credit
Parties will not permit Consolidated Operating Lease Expense for any fiscal
year of the Parent to be greater than $10,000,000.”

 

(f)            Section 7.3 of the Existing Note
Agreement is hereby amended by deleting the first word of the Section and
inserting “Except for the B-K Acquisitions, the”.

 

(g)           Section 7.4 of the Existing Note
Agreement is hereby amended by deleting paragraph (b) thereof in its entirety
and substituting in lieu thereof the following new Section 7.4(b) to read as
follows:

 

“(b) payment or
distribution on account of the purchase, repurchase, redemption, put, call or
other retirement of any shares of any Credit Party, or of any warrant, option
or other right to acquire such shares; provided, however, upon
the death of any of Dennis Nash, Carl Young or Lee Shaffer, the Parent may
repurchase the capital stock of the Parent held by such Person (or any of their
family members (including any trusts established for the benefit of such family
members)) immediately prior to his death solely from proceeds of a life
insurance policy on the life of such Person owned by the Parent or the Company,
and the Company may make distributions of such life insurance proceeds to the
Parent to the extent required to fund such repurchase; provided, that if the purchase
price exceeds the proceeds of the life insurance maintained by the Parent, the
balance of the purchase price may be payable in consecutive monthly principal
payments of

 

3

 

$10,000, plus accrued interest at the minimum applicable federal rate, so
long as no Default or Event of Default exists at the time of, or will be caused
by, the making of such monthly principal and interest payment; provided,
further, that if a Default or Event of Default would result from the making of
any such monthly principal or interest payments, such monthly principal and
interest payments may be made only to the extent that would not result in such
a Default or Event of Default; provided, further, that such obligations to so
pay any such balance of such purchase price shall be evidenced by such
instruments and documents as shall be satisfactory to the Majority Holders, and
shall be subordinated to the Senior Subordinated Obligations on such terms and
in such manner as the Majority Holders may require, and provided further,
however, upon the death of any of James McDaniel or Jerry McDaniel, the Parent
may repurchase the capital stock of the Parent held by such Person (or any of
his family members including any trusts established for the benefit of such
family members) immediately prior to his death solely from proceeds of a life
insurance policy on the life of such person owned by the Parent, the Company or
any Subsidiary, and the Company or such Subsidiary may make distributions of
such life insurance proceeds to the Parent to the extent required to fund such
repurchase.”

 

(h)           Section 7.5 of the Existing Note
Agreement is hereby amended by deleting Section 7.5 in its entirety and
substituting in lieu thereof the following new Section 7.5:

 

“7.5         Loans and Investments.  Except for Permitted Investments and the B-K
Acquisitions, the Company shall not, and shall not permit any other Credit
Party to, make any advance, loan, extension of credit, or capital contribution
to or investment in, or purchase any stock, bonds, notes, debentures, or other
securities of any Person (other than a Credit Party which is a guarantor of all
of the Senior Subordinated Obligations and with respect to which any sale of
the capital stock or substantially all of the assets of such Credit Party would
constitute an Event of Default); provided, however, that the
Company and their Subsidiaries may make advances to employees in the ordinary
course of business so long as the aggregate amount of such advances does not
exceed One Hundred Thousand Dollars ($100,000) in the aggregate outstanding at
any time.”

 

(i)            Section 7.11 of the Existing Note
Agreement is hereby amended by deleting Section 7.11 in its entirety and
substituting in lieu thereof the following new Section 7.11 to read as follows:

 

“7.11       Capital Expenditures.  The Company will not, and shall not permit
any other Credit Party to make or commit to make (by way of the acquisition of
securities of a Person or otherwise) any Capital Expenditure for the
acquisition of fixed or capital assets (excluding any Capital Expenditure in
respect of an asset acquired in connection with normal replacement and
maintenance programs properly charged to current operations) except for Capital
Expenditures in the ordinary course of business not exceeding, in the aggregate
for the Credit Parties during any fiscal year ending during any test period set
forth below, the amount set forth opposite such test period:

 

4

 

	
  Fiscal Year Ending

  	
   

  	
  Amount

  	
   

  
	
  December 31,
  2001

  	
   

  	
  $

  	
  15,000,000

  	
   

  
	
  December 31,
  2002

  	
   

  	
  $

  	
  15,000,000

  	
   

  
	
  December 31,
  2003

  	
   

  	
  $

  	
  21,000,000

  	
   

  
	
  December 31,
  2004

  	
   

  	
  $

  	
  22,000,000

  	
   

  
	
  December 31,
  2005

  	
   

  	
  $

  	
  24,000,000

  	
   

  
	
  December 31,
  2006

  	
   

  	
  $

  	
  24,000,000

  	
   

  
	
  December 31,
  2007

  	
   

  	
  $

  	
  24,000,000

  	
   

  

 

(j)            Section 7.14 of the Existing Note
Agreement is hereby amended by deleting Section 7.14 in its entirety and
substituting in lieu thereof the following new Section 7.14:

 

“7.14       Limitation on
Contingent Payments.  The Company
shall not, and shall not permit any other Credit Party to, make any Contingent
Payments due under the (a) Original Acquisition Agreement unless (i) no Event
of Default shall have occurred and be continuing, (ii) the Purchasers shall
have received audited financial statements for the period for which the
Contingent Payment relates, (iii) after giving effect to such Contingent
Payment, the ratio of Consolidated EBITDA less consolidated Capital
Expenditures of the Credit Parties to Consolidated Fixed Charges for the
preceding period of four full fiscal quarters shall not be less than 1.10 to
1.00; (iv) such Contingent Payments shall only be paid out of Contingent
Payments Excess Cash Flow and (v) both the current Borrowing Base (as such
term is defined in the Senior Loan Agreement) and Available RC Commitments (as
such term is defined in the Senior Loan Agreement) must have at least
$8,000,000 in availability to be borrowed under the Senior Loan Agreement after
giving effect to such Contingent Payments; provided, that if only a
portion of the Contingent Payments could be paid without violation of this Section 7.14,
the Company may pay such portion of the Contingent Payments, or (b) the Klemm
Earn-Out unless no Default or Event of Default under the Senior Loan Documents
and no Default or Event of Default shall have occurred or be continuing, both
before and after giving effect to such payment; provided, that if only a
portion of the Klemm Earn-Out could be paid without violation of this Section
7.14, Klemm or the Company may pay such portion of the Klemm Earn-Out.”

 

(k)           Section 11.1 of the Existing
Note Agreement is hereby amended by adding the following new definitions
thereto in the appropriate alphabetical order:

 

“Beneto” means Beneto, Inc., a California corporation.

 

5

 

“Beneto LLC” means Beneto Bulk Transport LLC, a California
limited liability company that owns all of the trucking-related assets used in
the conduct of the Beneto Business.

 

“Beneto Acquisition” means the acquisition by Kenan of all of
the membership interests of Beneto LLC pursuant to the Beneto Acquisition
Documents, and the other transactions contemplated by the Beneto Acquisition
Documents.

 

“Beneto Acquisition Agreement” means the Purchase Agreement,
dated as of May 15, 2003, among the Parent, Kenan, Beneto, Beneto LLC and
Stephen Beneto, as amended, supplemented or otherwise modified from time to
time in accordance with this Agreement.

 

“Beneto Acquisition Documents” means collectively, the Beneto
Acquisition Agreement and any other documents delivered in connection with the
Beneto Acquisition.

 

“Beneto Business” means the gasoline carrier business operated
by Beneto or Beneto LLC immediately prior to the Beneto Acquisition.

 

“Beneto Maximum Acquisition Amount” means Thirty Million Dollars
($30,000,000) plus any Transfer Fees, Prorated Registration Fees and Prepaid
Insurance (as such terms are defined in the Beneto Acquisition Agreement)
required to be paid pursuant to the Beneto Acquisition Agreement.

 

“B-K Acquisitions” means collectively, the Beneto Acquisition
and the Klemm Acquisition.

 

“Consolidated Operating Lease Expense” means for any period, the
aggregate amount of fixed or contingent rentals payable by the Parent and its
Subsidiaries, determined on a consolidated basis in accordance with GAAP, for
such period with respect to leases of real and personal property (other than
Financing Leases).

 

“Earn-Out Subordination Agreement” means the Earn-Out
Subordination Agreement by which the Klemm Earn-Out will be subordinate to the
Senior Subordinated Obligations.

 

 “Final Second Amendment
Closing Date” means the date, which shall be a date on or following the
Initial Second Amendment Closing Date, on which the conditions precedent set
forth in Section 4(b) and Section 5 or 6 (as applicable depending on which
B-K Acquisition is to be consummated on such date) of the Second Amendment
shall have been satisfied.

 

“Financing Lease” means any lease of property, real or personal,
the obligations of the lessee in respect of which are required in accordance
with GAAP to be capitalized on a balance sheet of the lessee.

 

6

 

“Initial Second Amendment Closing Date” means the date on which
the conditions precedent to the effectiveness of the Second Amendment set forth
in Section 4(a) and Section 5 or 6 (as applicable depending on which B-K
Acquisition is to be consummated on such date) of the Second Amendment shall
have been satisfied.

 

“Klemm” means Carl Klemm, Inc., a Wisconsin corporation.

 

“Klemm Acquisition” means the acquisition by Kenan of all of the
capital stock of Klemm, or substantially all the assets, pursuant to the Klemm
Acquisition Documents, and the other transactions contemplated by the Klemm
Acquisition Documents.

 

“Klemm Acquisition Agreement” means the acquisition agreement
entered into in connection with the Klemm Acquisition substantially in the form
of the draft dated May 20, 2003 delivered to the Purchasers, with such changes
thereto as are reasonably acceptable to the Purchasers.

 

“Klemm Acquisition Documents” means collectively, the Klemm
Acquisition Agreement and any other documents executed in connection with the
Klemm Acquisition.

 

“Klemm Business” means the transportation business of carrier
service for bulk petroleum products and liquid chemical products operated by
Klemm immediately prior to the Klemm Acquisition.

 

“Klemm Earn-Out” means the earn-out arrangement between Kenan
and the Klemm Sellers pursuant to the Klemm Acquisition Agreement.

 

“Klemm Maximum Acquisition Amount” means Seventeen Million
Dollars ($17,000,000).

 

“Klemm Sellers” means James Appleton and Greg Klimek.

 

“Second Amendment”
means that certain Second Amendment and Consent, dated as of May 30, 2003,
among the Company, the Parent and the Purchasers, as amended, supplemented or
otherwise modified from time to time.

 

“Second
Amendment Closing Date” means either of the Initial Second Amendment
Closing Date or the Final Second Amendment Closing Date.

 

(l)            Section 11.1 of the Existing
Note Agreement is hereby amended by deleting the following definitions in their
entirety and substituting in lieu thereof new definitions to read as follows:

 

“Acquisition
Agreements” means the Kenan Merger Agreement, the Advantage Merger
Agreement, and from and after the applicable Second Amendment Closing Date, the
Beneto Acquisition Agreement and the Klemm Acquisition Agreement.

 

“Acquisition Documents” means the Kenan Merger Agreement and the
agreements, documents and instruments executed in connection therewith or

 

7

 

contemplated thereby, and all amendments thereto, the Advantage Merger
Agreement and the agreements, documents and instruments executed in connection
therewith or contemplated thereby, and all amendments thereto, and from and
after the applicable Second Amendment Closing Date, the Beneto Acquisition
Documents and the Klemm Acquisition Documents.

 

“Consolidated EBITDA”: 
for any period, the sum for such period of (a) Consolidated Net
Income for such period, (b) the sum of provisions for such period for
income taxes, interest expense, and depreciation and amortization expense used
in determining such Consolidated Net Income, (c) amounts deducted in such
period in respect of non-cash expenses in accordance with GAAP, (d) the
amount of any aggregate net loss (or minus the amount of any gain) during such
period arising from the sale, exchange or other disposition of capital assets,
(e) non-cash expenses deducted in such period in connection with any
earn-out agreements, stock appreciation rights, “phantom” stock plans,
employment agreements, non-competition agreements, subscription and
stockholders agreements, stock option plans and similar arrangements made in
connection with acquisitions of Persons or businesses by the Parent or its
Subsidiaries or the retention of executives, officers or employees by the
Parent or its Subsidiaries, including (but without duplication) any Person that
has become a Subsidiary during such period on a pro forma basis as if such
acquisition had occurred on the first day of such period, and (f) any stay
bonuses, severance and lease continuations and any other cash expenses
associated with closing facilities or operations, in an aggregate amount for
all such items referred to in this clause (f) not to exceed $1,000,000; provided,
that Consolidated EBITDA shall in any event exclude, from and after the Closing
Date, (x) the effect of any write-up of any assets acquired in any
acquisitions and (y) the amount of any non-cash income recognized during
any period for which Consolidated EBITDA is determined; and provided, further,
that, except for purposes of calculating Consolidated EBITDA for determining
compliance with Sections 6.23(b) and (c), for any period ended prior to the
date on which four full fiscal quarters of the Parent have elapsed since the
Initial Second Amendment Closing Date and the Final Second Amendment Closing
Date, Consolidated EBITDA for such period shall be calculated to give effect on
a pro
forma basis to the B-K Acquisitions consummated on such Second Amendment
Closing Dates as if such transactions had been consummated on the first day of
such period.

 

“Contingent Payments” means,
collectively, (i) the payments of additional purchase price pursuant to Section
2.3 of the Original Acquisition Agreement, (ii) the payments payable under the
Emery Asset Purchase Agreement and (iii) any payments under the Klemm Earn-Out.

 

“Credit Parties” means each of Parent, AMHC, AMGI, Kenan, KTC,
ATL, NCT, McDaniel, Evalia, Geni Management Corporation, Geni Transport, Inc.,
PCT, Klemm (from and after the date of the consummation of the Klemm
Acquisition), Beneto LLC (from and after the date of the consummation of the
Beneto Acquisition) and any other Subsidiaries.

 

8

 

“First Amendment” means that certain First Amendment to Note
Purchase Agreement, dated as of September 30, 2002, among the Company, the
Parent and the Purchasers, as amended, supplemented or otherwise modified from
time to time.

 

“Guaranty” means (i) the guaranty dated the date hereof executed
by Parent, AMHC and each Subsidiary of the Company (other than PCT) in favor of
Purchasers in respect of any of the Senior Subordinated Obligations, as the
same may be amended, restated, modified or extended from time to time, (ii) the
guaranty dated the date hereof executed by PCT of the Company in favor of
Purchasers in respect of any of the Senior Subordinated Obligations, as the
same may be amended, restated, modified or extended from time to time, (iii)
the guaranty dated as of the Initial Second Amendment Closing Date executed by
Beneto LLC in favor of Purchasers in respect of any of the Senior Subordinated
Obligations, as the same may be amended, restated, modified or extended from
time to time, and (iv) if the Klemm Acquisition occurs, the guaranty dated as
of the Final Second Amendment Closing Date executed by Klemm in favor of
Purchasers in respect of any of the Senior Subordinated Obligations, as the
same may be amended, restated, modified or extended from time to time.

 

“Other Agreements” means the Senior Subordinated Notes, the
Warrant Documents, the Put Guaranty, the Guaranty, the Escrow Agreement, the
Seller Subordination Agreements and all other agreements, instruments and
documents (including, without limitation, notes, guarantees, powers of
attorney, consents, assignments, contracts, notices, subordination agreements
and all other written matter), and all renewals, modifications and extensions
thereof, whether heretofore, now or hereafter executed by or on behalf of any
Credit Party and delivered to and for the benefit of Purchasers or any Person
participating with Purchasers in the Senior Subordinated Notes with respect to
this Agreement or any of the transactions contemplated by this Agreement.

 

“Permitted Investments”
means the following:

 

(a)           securities issued or directly and
fully guaranteed or insured by the United States Government or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States Government is pledged in support thereof), having maturities of not more
than twelve months from the date of acquisition;

 

(b)           time deposits and certificates of
deposit of any commercial bank incorporated in the United States of recognized
standing having capital and surplus in excess of $100,000,000 with maturities
of not more than twelve months from the date of acquisition and rated AA- (or
the equivalent thereof) or higher by Standard & Poor’s Corporation with
respect to its long-term senior debt;

 

(c)           commercial paper issued by any Person
incorporated in the United States rated at least A-1 or the equivalent thereof
by Standard & Poor’s, a division of The McGraw-Hill Companies, Inc. or at
least P-1 or the equivalent thereof by Moody’s

 

9

 

Investors Service, Inc.
and in each case maturing not more than twelve months after the date of
acquisition;

 

(d)           investments in money market funds
substantially all of whose assets are comprised of securities of the types
described in clauses (a) through (c) above;

 

(e)           investments in, or debts incurred or
liabilities assumed on behalf and for the benefit of, the Subsidiaries or joint
ventures or companies in which the Company owns at least 50% of the voting
rights thereof, which investments, debts incurred and liabilities assumed (i)
do not exceed $500,000 per year in the aggregate and (ii) do not exceed
$1,000,000, from and after the Closing Date in the aggregate; notwithstanding
and in addition to the foregoing the Company shall be permitted to make
advances and capital contributions to each of its Subsidiaries which at such
time is a guarantor of the Senior Subordinated Obligation pursuant to the
Guaranty, and each such Subsidiary shall be permitted to make advances and
capital contributions to the Company, if such advances are consistent with the
policies of the Company’s board of directors; and

 

(f)            investments pursuant to the B-K
Acquisitions.

 

“Put Guaranty”
means (i) the guaranty of AMHC, the Company and each Subsidiary (other than
PCT) of the obligations of the Parent under the Warrant Documents, (ii) the
guaranty of PCT of the obligations of the Parent under the Warrant Documents,
(iii) the guaranty of Beneto LLC of the obligations of Parent under the Warrant
Documents and (iv) if the Klemm Acquisition is consummated, the guaranty of
Klemm of the obligations of Parent under the Warrant Documents.

 

“Seller Subordination
Agreement” means (i) that certain Seller Subordination Agreement dated as
of December 31, 1998 executed by the Company, RSTW and the Sellers pursuant to
which the relative priorities of the Sellers and Purchasers with respect to the
payment of any Contingent Payments and the repayment of the Senior Subordinated
Obligations are established, (ii) that certain Amended and Restated Seller
Subordination Agreement of even date herewith executed by the Company, Dennis
Nash, Carl Young and Purchasers pursuant to which the relative priorities of
the Sellers and Purchasers with respect to the payment of any Contingent
Payments and the repayment of the Senior Subordinated Obligations are
established, and (iii) if the Klemm Acquisition is consummated, the Earn-Out
Subordination Agreement.

 

“Senior Debt”
means the principal amount of any Indebtedness of the Company and its
Subsidiaries for borrowed money under the Senior Loan Documents, now or
hereafter outstanding, together with any interest (including any post-petition
interest accruing after the commencement of any case, proceeding or other
action relating to the bankruptcy, insolvency or reorganization of the Company
at the interest rate provided for in the Senior Loan Agreement, whether or not
such interest is an allowable claim in any such proceeding) or premium due
thereon and any other amount payable with respect thereto, provided that:

 

10

 

(i)            in no event shall the aggregate
principal amount of Senior Debt exceed an amount equal to the sum of:

 

(a) an amount
equal to (1) the lesser of (A) $149,650,000 or (B) an amount equal to
the sum of (x) up to $20,000,000 of Revolving Credit Loans, plus (y) up to
$129,650,000 of Term Loans, minus (2) the aggregate amount of any
permanent reductions in the maximum committed amount of the Revolving Credit
Loans, minus (3) the aggregate amount of any and all principal payments or
prepayments from time to time made in respect of the Term Loans; plus

 

(b) the sum
of (I) an amount representing indebtedness incurred only in connection
with a “workout” as determined by the Senior Lender in its good faith judgement
following notice to the Holders in an aggregate amount which does not exceed
the greater of (A) $10,000,000 or (B) 10% of the principal amount of
the loans described in subparagraph (a) above (subject to the limitations
therein) which are outstanding on the first date (the “Reference Date”) upon
which there occurs the earlier of (x) the Holders’ receipt of a Stop
Payment Notice (as such term is defined in the Senior Subordination Agreement)
under the Senior Subordination Agreement from the Senior Lender or (y) the
occurrence of a default in the payment of principal or interest under the
Senior Loan Agreement, minus (II) the amount of any fees, expenses or
other obligations or liabilities (other than principal and interest) under the
Senior Loan Documents which are outstanding at or incurred after the Reference
Date;

 

(ii)           in no event shall Senior Debt include
(a) any indebtedness of any Person which, by its terms, by the terms of the
instrument creating or evidencing it, by contract or otherwise, is subordinate
in right of payment to any other indebtedness of any Person or (b) any trade
debt of the Company, whether or not initially owing to any Person other than
the Senior Lender under the Senior Loan Agreement (or under the agreements,
documents and instruments related to any refinancing thereof) and subsequently
acquired by the Senior Lender.

 

Senior Debt shall also include any Indebtedness of the
Company incurred in connection with a refinancing of the Senior Debt under the
Senior Loan Documents if the terms and conditions of the agreements, documents
and instruments related to such refinancing, taken as a whole, are not
materially more onerous to the Holders than those set forth in the Senior Loan
Documents, as in effect on the date hereof. 
Senior Debt shall continue to constitute Senior Debt notwithstanding the
fact that such Senior Debt or any claim for such Senior Debt is involuntarily
subordinated, avoided or disallowed under the Federal Bankruptcy Code or any
other applicable law.

 

“Senior Loan Agreement”
means the Amended and Restated Credit Agreement among the Parent, the Company
and the Senior Lender, dated as of April 30, 2001, as amended by the First
Amendment and Consent dated as of September 30, 2002 and further amended by the
Second Amendment and Consent dated as of May 30, 2003 and as may be
further amended to the extent permitted under Section 7.8, and all
documents

 

11

 

and instruments delivered pursuant thereto in
connection with the loans and advances made thereunder.

 

“Senior Subordination
Agreement” means that certain Senior Subordination Agreement of even date
herewith executed by the Company, the Senior Lender and Purchasers, as amended
by the First Amendment to Senior Subordination Agreement dated as of
May 30, 2003, and as may further be amended pursuant the terms thereof,
pursuant to which the relative priorities of the Senior Lender and Purchasers
with respect to the repayment of Senior Debt and the Senior Subordinated
Obligations are established.

 

“Term Loans” means, collectively, the term loans made by Senior
Lender pursuant to the Senior Loan Agreement.”

 

(m)          Schedule 4.16 to the Existing Note
Agreement is hereby amended by deleting such Schedule in its entirety and
substituting in lieu thereof (i) as of the Initial Second Amendment Closing
Date, the Schedules 4.16A, 4.16B and 4.16C attached to this Second Amendment;
and (ii) as of the Final Second Amendment Closing Date, such other Schedules
4.16A, 4.16B and 4.16C, consistent in all material respects with the terms of
the Klemm Acquisition Agreement, as shall have then been delivered by the
Company and reasonably approved by the Purchasers.

 

(n)           Exhibits D and E and Schedules 4.5,
4.17 and 4.24 to the Existing Note Agreement are hereby supplemented by adding
thereto (i) as of the Initial Second Amendment Closing Date, the material set
forth on Exhibits D and E and Schedules 4.5, 4.17 and 4.24 attached to this
Second Amendment, respectively; and (ii) as of the Final Second Amendment Closing
Date, the material set forth on Exhibits D and E and Schedules 4.5, 4.17 and
4.24 attached to this Second Amendment, respectively, consistent in all
material respects with the terms of the Klemm Acquisition Agreement, as shall
have then been delivered by the Company and reasonably approved by the
Purchasers..

 

3.             Consent. 
The Purchasers hereby consent to (a) the payment by the Parent or one of
its Subsidiaries (i) to each of Sterling Investment Partners Advisors, LLC and
RFE Management Corporation, or their respective Subsidiaries and/or Affiliates,
in accordance with the terms of the Management Agreement, a transaction fee of
up to 0.625% of the transaction value of the Beneto Acquisition, payable at the
time such transaction closes, (ii) to each of Sterling Investment Partners
Advisors, LLC and RFE Management Corporation, or their respective Subsidiaries
and/or Affiliates, in accordance with the terms of the Management Agreement, a
transaction fee of up to 0.625% of the transaction value of the Klemm Acquisition,
(iii) to Dennis Nash and Carl Young a transaction fee aggregating up to
$106,750 at the time the Beneto Acquisition closes and (iv) to Dennis Nash and
Carl Young a transaction fee aggregating up to $68,250 at the time the Klemm
Acquisition closes, and (b) the Second Amendment and Consent to the Senior Loan
Agreement in substantially the form delivered to Purchasers on or prior to the
Initial Second Amendment Closing Date.

 

4.             Effectiveness; Initial Second Amendment Closing Date;
Final Second Amendment Closing Date.

 

(a)           Initial Second Amendment Closing
Date.  The effectiveness of this
Second Amendment, is subject to the satisfaction of the conditions precedent
set forth in this

 

12

 

Section 4(a) and the conditions set forth in either Section 5 or 6
below (as applicable depending on which B-K Acquisition is to be consummated on
such date) (the date of such satisfaction being herein referred to as the “Initial
Second Amendment Closing Date”):

 

(i)            Amendment
Documents.  The Purchasers shall
have received this Second Amendment, executed and delivered by a duly
authorized officer of the Company, the Parent and the Purchasers.  Collectively, this Second Amendment, and the
other documents to be delivered pursuant to either Section 5(a) or 6(a) (as
applicable depending on which B-K Acquisition is to be consummated on such
date) are referred to herein as the “Initial Second Amendment Documents”.

 

(ii)                   Amendment
to Senior Loan Documents. The Purchasers shall have received amendments to
the Senior Loan Documents, each in form and substance satisfactory to the
Purchasers, providing for, among other things, the consent of the Senior
Lenders to the B-K Acquisitions and the financings contemplated thereby.

 

(iii)                  Corporate
Proceedings of the Credit Parties. 
The Purchasers shall have received a copy of the resolutions, in form
and substance satisfactory to the Purchasers, of the Board of Directors of each
Credit Party authorizing the execution, delivery and performance of this Second
Amendment and the other Initial Second Amendment Documents to which it is a
party.

 

(iv)                  Incumbency
Certificate.  The Purchasers shall
have received a certificate of each Credit Party, dated the Initial Second
Amendment Closing Date, as to the incumbency and signature of the officers of
such Credit Party executing this Second Amendment or the other Initial Second
Amendment Documents to which such Credit Party is a party, satisfactory in form
and substance to the Purchasers, executed by the President or any Vice
President and the Secretary or any Assistant Secretary of such Credit Party.

 

(v)                   Corporate
Documents.  The Purchasers shall
have received true and complete copies of the certificate of incorporation,
certificate of formation, operating agreement, partnership agreement or other
applicable governing documents and the by-laws of each Credit Party, certified
as of the Initial Second Amendment Closing Date as complete and correct copies
thereof by the Secretary or an Assistant Secretary of such Credit Party, or a
certificate from such Credit Party that there has been no change or amendment
to such documents since the Closing Date.

 

(vi)                  Good
Standing Certificate.  The
Purchasers shall have received a certificate dated as of a recent date from the
Secretary of State or other appropriate authority, evidencing the good standing
of each of each Credit Party, (i) in the jurisdiction of its organization
and (ii) in each other jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires it to qualify as
a foreign Person except, as to this subclause (ii), where the failure to
so qualify could not reasonably be expected to have a Material Adverse Effect.

 

13

 

(vii)                 Historical
Financial Information.  The
Purchasers shall have received copies of the financial statements described in
Section 7(a) of the Second Amendment.

 

(viii)                Pro Forma
Financial Information.  The
Purchasers shall have received copies of the Beneto/Klemm Pro Forma Balance
Sheet described in Section 7(b) of this Second Amendment.

 

(ix)                   Business
Plan.  The Purchasers shall have
received a satisfactory revised business plan or revised projections of the
Parent and its Subsidiaries for fiscal years 2003 through 2007 (giving effect
to the B-K Acquisitions).

 

(x)                    Solvency
Certificate.  The Purchasers shall
have received a certificate of the chief executive officer or chief financial
officer of the Parent and the Company, dated as of the Initial Second Amendment
Closing Date, certifying that the representations and warranties contained in
Section 7(n) of the Second Amendment are true and correct as of the Initial
Second Amendment Closing Date.

 

(xi)                   Material
Adverse Effect.  No event or
circumstance, including, without limitation, any change related to the Company
or the financial markets, shall have occurred that could reasonably be expected
to have a Material Adverse Effect, as determined by the Purchasers in their
sole discretion, exercised in good faith.

 

(xii)                  Representations
and Warranties.  Each of the
representations and warranties made by the Company and the other Credit Parties
in or pursuant to the Note Agreement and Other Agreements (other than the
Warrant Purchase Agreement) (as updated
pursuant to Sections 2(m) and 2(n) of the Second Amendment), other than the
representations and warranties contained in Sections 4.1,
4.2(c) and (d), 4.3, 4.6, 4.7, 4.8, 4.11, 4.15, 4.20, 4.22, and 4.24 of the Note Agreement, shall
be true and correct in all material respects on and as of the Initial Second
Amendment Closing Date as if made on and as of the Initial Second Amendment
Closing Date (and after giving effect to the amendments provided for in this
Second Amendment) (or, if any such representation or warranty is expressly
stated to have been made as of a specific date, as of such specific date).

 

(xiii)                 No
Default.  No Default or Event of
Default shall have occurred and be continuing on the Initial Second Amendment
Closing Date or after giving effect to the amendments provided for in this
Second Amendment.

 

(b)           Final Second Amendment Closing
Date. The effectiveness of this Second Amendment as it relates to the last
of the B-K Acquisitions to be consummated is subject to the satisfaction of the
conditions precedent set forth in this Section 4(b) and the conditions set
forth in either Section 5 or 6 below (as applicable depending on which B-K
Acquisition is to be consummated on such date) (the date of such satisfaction
being herein referred to as the “Final Second Amendment Closing Date”):

 

(i)                    Corporate
Proceedings of the Credit Parties. 
The Purchasers shall have received a copy of the resolutions, in form
and substance satisfactory to the Purchasers, of the Board of Directors of each
Credit Party authorizing the execution, delivery and

 

14

 

performance of the
Final Second Amendment Documents to which it is a party, certified by the
Secretary or an Assistant Secretary of such Credit Party as of the Final Second
Amendment Closing Date, which certificate shall be in form and substance
satisfactory to the Purchasers and shall state that the resolutions thereby
certified have not been amended, modified, revoked or rescinded.

 

(ii)                   Incumbency
Certificate.  The Purchasers shall
have received a certificate of each Credit Party, dated the Final Second
Amendment Closing Date, as to the incumbency and signature of the officers of
such Credit Party executing the Final Second Amendment Documents to which such
Credit Party is a party, satisfactory in form and substance to the Purchasers,
executed by the President or any Vice President and the Secretary or any
Assistant Secretary of such Credit Party.

 

(iii)                  Corporate
Documents.  The Purchasers shall
have received true and complete copies of the certificate of incorporation,
certificate of formation, operating agreement, partnership agreement or other
applicable governing documents and the by-laws of each Credit Party, certified
as of the Final Second Amendment Closing Date as complete and correct copies
thereof by the Secretary or an Assistant Secretary of such Credit Party, or a
certificate from such Credit Party that there has been no change or amendment
to such documents since the Initial Second Amendment Closing Date.

 

(iv)                  Good
Standing Certificate.  The
Purchasers shall have received a certificate dated as of a recent date from the
Secretary of State or other appropriate authority, evidencing the good standing
of each Credit Party as to which such a good standing certificate was not
delivered on the Initial Second Amendment Closing Date, (i) in the
jurisdiction of its organization and (ii) in each other jurisdiction where
its ownership, lease or operation of property or the conduct of its business
requires it to qualify as a foreign Person except, as to this
subclause (ii), where the failure to so qualify could not reasonably be
expected to have a Material Adverse Effect.

 

(v)                   Solvency
Certificate.  The Purchasers shall
have received a certificate of the chief executive officer or chief financial
officer of the Parent and the Company, dated as of the Final Second Amendment
Closing Date, certifying that the representations and warranties contained in
Section 7(n) of the Second Amendment are true and correct as of the Final Second
Amendment Closing Date.

 

(vi)                  Material
Adverse Effect.  No event or
circumstance, including, without limitation, any change related to the Company
or the financial markets, shall have occurred that could reasonably be expected
to have a Material Adverse Effect, as determined by the Purchasers in their
sole discretion, exercised in good faith.

 

(vii)                 Representations
and Warranties.  Each of the
representations and warranties made by the Company and the other Credit Parties
in or pursuant to the Note Agreement and Other Agreements (other than the
Warrant Purchase Agreement) (as updated
pursuant to Sections 2(m) and 2(n) of the Second Amendment), other than the
representations and warranties contained in Sections 4.1,
4.2(c) and (d), 4.3, 4.6, 4.7, 4.8, 4.11, 4.15, 4.20, 4.22, and 4.24 of the Note Agreement, shall
be true and correct in all

 

15

 

material respects
on and as of the Final Second Amendment Closing Date as if made on and as of
the Final Second Amendment Closing Date (and after giving effect to the
amendments provided for in this Second Amendment) (or, if any such
representation or warranty is expressly stated to have been made as of a
specific date, as of such specific date).

 

(viii)                No
Default.  No Default or Event of
Default shall have occurred and be continuing on the Final Second Amendment
Closing Date or after giving effect to the amendments provided for in this
Second Amendment.

 

5.             Conditions Relating to Beneto
Acquisition.

 

(a)           Amendment Documents. The
Purchasers shall receive immediately following the consummation of the Beneto
Acquisition a Guaranty and Put Guaranty, each in form satisfactory to the
Purchasers, pursuant to which any Subsidiary formed or acquired by any Credit
Party in connection with the Beneto Acquisition shall become a Guarantor.

 

(b)           Related Agreements.  The Purchasers shall have received true and
correct copies, certified as to authenticity by the Company, of each Beneto
Acquisition Document, and such other documents or instruments as may be
reasonably requested by the Purchasers, including, without limitation, a copy
of any debt instrument, security agreement or other material contract to which
Beneto LLC may be a party. The Beneto Acquisition Documents shall be reasonably
satisfactory to the Purchasers in all respects.

 

(c)           Concurrent Transactions.  The Beneto Acquisition shall have been or
shall be consummated in accordance with the terms of the Beneto Acquisition
Documents for a total consideration in cash not to exceed the Beneto Maximum
Acquisition Amount pursuant to and in accordance with the Beneto Acquisition
Documents, in each case without any amendment, modification or waiver thereof
except with the consent of the Purchasers, and the Purchasers shall have
received evidence satisfactory to it to that effect.

 

(d)           Proceedings of Beneto LLC.  The Purchasers shall have received a copy of
the resolutions, in form and substance satisfactory to the Purchasers, of the
Board of Managers of Beneto LLC authorizing (i) the execution, delivery
and performance of the Second Amendment Documents to which it is a party and
(ii) the borrowings contemplated under the Senior Loan Documents,
certified by the Secretary or an Assistant Secretary of Beneto LLC as of the
Initial Second Amendment Closing Date, which certificate shall be in form and
substance satisfactory to the Purchasers and shall state that the resolutions
thereby certified have not been amended, modified, revoked or rescinded.

 

(e)           Beneto LLC Incumbency Certificate.  The Purchasers shall have received a
certificate of Beneto LLC, dated the Initial Second Amendment Closing Date, as
to the incumbency and signature of the officers of Beneto LLC executing any
Second Amendment Documents to which it is a party, satisfactory in form and
substance to the Purchasers, executed by the President or any Vice President
and the Secretary or any Assistant Secretary of Beneto LLC.

 

16

 

(f)            Documents of Beneto LLC.  The Purchasers shall have received true and
complete copies of the certificate of incorporation, certificate of formation,
operating agreement, partnership agreement or other applicable governing
documents by-laws of Beneto LLC, certified as of the Initial Second Amendment
Closing Date as complete and correct copies thereof by the Secretary or an
Assistant Secretary of Beneto LLC.

 

(g)           Good Standing Certificate.  The Purchasers shall have received a
certificate dated as of a recent date from the Secretary of State or other
appropriate authority, evidencing the good standing of Beneto LLC, (i) in
the jurisdiction of its organization and (ii) in each other jurisdiction
where its ownership, lease or operation of property or the conduct of its
business requires it to qualify as a foreign Person except, as to this
subclause (ii), where the failure to so qualify could not reasonably be
expected to have a Material Adverse Effect.

 

(h)           Consents, Licenses and Approvals.  The Purchasers shall have received a
certificate of an officer of the Company (i) attaching copies of any
consents, authorizations and filings referred to in Section 4.4 of the
Note Agreement (as amended hereby) relative to Beneto LLC, and Sections 3.03(b)
and 3.03(c) of the Beneto Acquisition Agreement (other than consents for contracts
terminable at the option of the other contracting party or for contracts
pursuant to which the counterparty has no fixed monetary commitment amount and
other consents which pursuant to the terms of the Beneto Acquisition Agreement,
are not required to be obtained at the consummation of the Beneto Acquisition),
and (ii) stating that such consents, licenses and filings are in full
force and effect and irrevocable, and each such consent, authorization and
filing shall be in form and substance satisfactory to the Purchasers.  The Purchasers shall be satisfied that
relevant Credit Parties shall have all licenses, permits, contracts,
trademarks, patents and other approvals of Governmental Authorities and other
intellectual property rights necessary to conduct the Beneto Business.

 

(i)            Reserved.

 

(j)            Legal Opinions.  The Purchasers shall have received the
following executed legal opinions:

 

(i)            the executed legal opinion of
Fulbright & Jaworski L.L.P., New York counsel to the Company and the other
Credit Parties, in form and substance satisfactory to the Purchasers;

 

(ii)           the executed legal opinion of Tom
Julius, Esq., Ohio counsel of the Company, in form and substance satisfactory
to the Purchasers;

 

(iii)          the executed legal opinion of Helms
Mulliss & Wicker, North Carolina counsel to the Company, in form and
substance satisfactory to the Purchasers; and

 

(iv)          the executed legal opinion of
Fulbright & Jaworski L.L.P., California counsel to Beneto LLC immediately
following the Closing (as defined in the Beneto Acquisition Agreement) of the
Beneto Acquisition, in form and substance satisfactory to the Purchasers.

 

17

 

Each such legal opinion
shall cover such other matters incident to the transactions contemplated by
this Second Amendment as the Purchasers may reasonably require.

 

(k)           Reserved.

 

(l)            Lien Searches. The Purchasers
shall have received the results of a recent search by a Person satisfactory to
the Purchasers, of the Uniform Commercial Code, judgment and tax lien filings
which may have been filed with respect to personal property of Beneto and the
results of such search shall be satisfactory to the Purchasers.

 

(m)          Insurance.  The Purchasers shall have received evidence
in form and substance satisfactory to it that all of the requirements of
Section 6.13 of the Note Agreement shall have been satisfied with respect
to the Beneto Business and the assets to be acquired in the Beneto Acquisition.

 

(n)           Maximum Leverage Ratio.  The Leverage Ratio as of March 31, 2003,
determined on a pro forma basis for the Beneto Acquisition and the other
transactions contemplated to occur on the Initial Second Amendment Closing Date
(determining Consolidated EBITDA for purposes of such definition as if the
Beneto Acquisition had been consummated on the first day of the period of four
consecutive fiscal quarters of the Parent ended March 31, 2003), shall not
exceed 3.55 to 1.00.

 

(o)           Maximum Senior Leverage Ratio.  The ratio of (i) Consolidated Funded Debt minus
the aggregate principal amount of the Senior Subordinated Notes, in each case
as of March 31, 2003, to (ii) Consolidated EBITDA for the period of four
consecutive fiscal quarters of the Parent ended March 31, 2003, determined on a
pro forma basis for the Beneto Acquisition and the other transactions
contemplated to occur on the Initial Second Amendment Closing Date (determining
Consolidated EBITDA for purposes of such definition as if the Beneto
Acquisition had been consummated on the first day of the period of four consecutive
fiscal quarters of the Parent ended March 31, 2003), shall not exceed 2.75 to
1.00.

 

(p)           No Litigation.  No litigation shall be pending or threatened
with respect to Beneto LLC, the Company or any other Credit Party, which the
Purchasers believe could have a Material Adverse Effect on the business,
property, operations or conditions (financial or otherwise) of the Credit
Parties.

 

(q)           Reserved.

 

(r)            Environmental Reports.  The Purchasers shall have received Phase I
environmental reports, and, if requested by the Purchasers based upon its
review of the Phase I environmental reports, Phase II or other environmental
reports, prepared by a Person reasonably satisfactory to the Purchasers, and
which such Person shall have confirmed in writing that the Purchasers shall be
entitled to rely upon, with respect to all material properties acquired in
connection with the Beneto Acquisition, and the Purchasers shall be satisfied
with such environmental reports in all respects.

 

(s)           Additional Matters.  All corporate and other proceedings, and all
documents, instruments and other legal matters in connection with the
transactions contemplated

 

18

 

by this Agreement, the Note Agreement, the Other Agreements, and the
Beneto Acquisition Documents shall be satisfactory in form and substance to the
Purchasers, and the Purchasers shall have received such other documents and
legal opinions in respect of any aspect or consequence of the transactions
contemplated hereby or thereby as it shall reasonably request.

 

6.             Conditions Relating to Klemm Acquisition.

 

(a)           Amendment Documents.  The Purchasers shall receive immediately
following the consummation of the Klemm Acquisition (i) a Guaranty and a Put
Guaranty, each in form satisfactory to the Purchasers, pursuant to which any
Subsidiary formed or acquired by any Credit Party in connection with the Klemm
Acquisition shall become a Guarantor and (ii) the Earn-Out Subordination
Agreement.  Collectively, the documents
referenced in this Section 6(a) are referred to herein as the “Final
Second Amendment Documents” and, collectively with the Initial Second
Amendment Documents, the “Second Amendment Documents”.

 

(b)           Related Agreements.  The Purchasers shall have received true and
correct copies, certified as to authenticity by the Company, of each Klemm
Acquisition Document, and such other documents or instruments as may be
reasonably requested by the Purchasers, including, without limitation, a copy
of any debt instrument, security agreement or other material contract to which
Klemm may be a party. The Klemm Acquisition Documents shall be reasonably
satisfactory to the Purchasers in all respects.

 

(c)           Concurrent Transactions.  The Klemm Acquisition shall have been or
shall be consummated in accordance with the terms of the Klemm Acquisition
Documents for a total consideration in cash and stock at closing not to exceed
the Klemm Maximum Acquisition Amount pursuant to and in accordance with the
Klemm Acquisition Documents, in each case without any amendment, modification
or waiver thereof except with the consent of the Purchasers, and the Purchasers
shall have received evidence satisfactory to it to that effect.

 

(d)           Corporate Proceedings of Klemm.  The Purchasers shall have received a copy of
the resolutions, in form and substance satisfactory to the Purchasers, of the
Board of Directors of Klemm (or the Subsidiary formed to acquire the Klemm
Assets) authorizing (i) the execution, delivery and performance of the
Second Amendment Documents to which it is a party and (ii) the borrowings
contemplated under the Senior Loan Documents, certified by the Secretary or an
Assistant Secretary of Klemm as of the Final Second Amendment Closing Date,
which certificate shall be in form and substance satisfactory to the Purchasers
and shall state that the resolutions thereby certified have not been amended,
modified, revoked or rescinded.

 

(e)           Klemm Incumbency Certificate.  The Purchasers shall have received a
certificate of Klemm (or the Subsidiary formed to acquire the Klemm assets),
dated the Final Second Amendment Closing Date, as to the incumbency and
signature of the officers of Klemm executing any Second Amendment Documents to
which it is a party, satisfactory in form and substance to the Purchasers,
executed by the President or any Vice President and the Secretary or any
Assistant Secretary of Klemm.

 

19

 

(f)            Corporate Documents of Klemm.  The Purchasers shall have received true and
complete copies of the certificate of incorporation, certificate of formation,
operating agreement, partnership agreement or other applicable governing
documents by-laws of Klemm (or the Subsidiary formed to acquire the Klemm
assets), certified as of the Final Second Amendment Closing Date as complete
and correct copies thereof by the Secretary or an Assistant Secretary of Klemm.

 

(g)           Good Standing Certificate.  The Purchasers shall have received a
certificate dated as of a recent date from the Secretary of State or other
appropriate authority, evidencing the good standing of Klemm (or the Subsidiary
formed to acquire the Klemm Assets), (i) in the jurisdiction of its
organization and (ii) in each other jurisdiction where its ownership,
lease or operation of property or the conduct of its business requires it to
qualify as a foreign Person except, as to this subclause (ii), where the
failure to so qualify could not reasonably be expected to have a Material
Adverse Effect.

 

(h)           Consents, Licenses and Approvals.  The Purchasers shall have received a
certificate of an officer of the Company (i) attaching copies of any
consents, authorizations and filings referred to in Section 4.4 of the
Note Agreement (as amended hereby) relative to Klemm, and the Klemm Acquisition
Agreement (other than consents for contracts terminable at the option of the
other contracting party or for contracts pursuant to which the counterparty has
no fixed monetary commitment amount and other consents which pursuant to the
terms of the Klemm Acquisition Agreement, are not required to be obtained at
the consummation of the Klemm Acquisition), and (ii) stating that such
consents, licenses and filings are in full force and effect and irrevocable,
and each such consent, authorization and filing shall be in form and substance
satisfactory to the Purchasers.  The
Purchasers shall be satisfied that relevant Credit Parties shall have all
licenses, permits, contracts, trademarks, patents and other approvals of
Governmental Authorities and other intellectual property rights necessary to
conduct the Klemm Business.

 

(i)            Reserved.

 

(j)            Legal Opinions.  The Purchasers shall have received the
following executed legal opinions:

 

(i)            the executed legal opinion of
Fulbright & Jaworski L.L.P., New York counsel to the Company and the other
Credit Parties, in form and substance satisfactory to the Purchasers;

 

(ii)           the executed legal opinion of Tom
Julius, Esq., Ohio counsel of the Company, in form and substance satisfactory
to the Purchasers;

 

(iii)          the executed legal opinion of Helms
Mulliss & Wicker, North Carolina counsel to the Company, in form and
substance satisfactory to the Purchasers; and

 

(iv)          the executed legal opinion of local
Wisconsin counsel to Klemm, in form and substance satisfactory to the
Purchasers.

 

20

 

Each such legal opinion
shall cover such other matters incident to the transactions contemplated by
this Second Amendment as the Purchasers may reasonably require.

 

(k)           Reserved.

 

(l)            Lien Searches. The Purchasers
shall have received the results of a recent search by a Person satisfactory to
the Purchasers, of the Uniform Commercial Code, judgment and tax lien filings
which may have been filed with respect to personal property of Klemm, and the
results of such search shall be satisfactory to the Purchasers.

 

(m)          Insurance.  The Purchasers shall have received evidence
in form and substance satisfactory to it that all of the requirements of
Section 6.13 of the Note Agreement shall have been satisfied with respect
to the Klemm Business and the assets to be acquired in the Klemm Acquisition.

 

(n)           Maximum Leverage Ratio.  The Leverage Ratio as of March 31, 2003,
determined on a pro forma basis for the B-K Acquisitions and the other
transactions contemplated to occur on the Second Amendment Closing Dates
(determining Consolidated EBITDA for purposes of such definition as if the B-K
Acquisitions had been consummated on the first day of the period of four
consecutive fiscal quarters of the Parent ended March 31, 2003), shall not
exceed 3.55 to 1.00.

 

(o)           Maximum Senior Leverage Ratio.  The ratio of (i) Consolidated Funded Debt minus
the aggregate principal amount of Subordinated Debt, in each case as of March
31, 2003, to (ii) Consolidated EBITDA for the period of four consecutive fiscal
quarters of the Parent ended March 31, 2003, determined on a pro forma basis
for the B-K Acquisitions and the other transactions contemplated to occur on
the Second Amendment Closing Dates (determining Consolidated EBITDA for
purposes of such definition as if the B-K Acquisitions had been consummated on
the first day of the period of four consecutive fiscal quarters of the Parent
ended March 31, 2003), shall not exceed 2.75 to 1.00.

 

(p)           No Litigation.  No litigation shall be pending or threatened
with respect to Klemm, the Company or any other Credit Party, which the
Purchasers believe could have a Material Adverse Effect on the business,
property, operations or conditions (financial or otherwise) of the Credit
Parties.

 

(b)           Reserved.

 

(q)           Reserved.

 

(r)            Environmental Reports.  The Purchasers shall have received Phase I
environmental reports, and, if requested by the Purchasers based upon its
review of the Phase I environmental reports, Phase II or other environmental
reports, prepared by a Person reasonably satisfactory to the Purchasers, and
which such Person shall have confirmed in writing that the Purchasers shall be
entitled to rely upon, with respect to all material properties acquired in
connection with the Klemm Acquisition, and the Purchasers shall be satisfied
with such environmental reports in all respects.

 

21

 

(s)           Additional Matters.  All corporate and other proceedings, and all
documents, instruments and other legal matters in connection with the transactions
contemplated by this Agreement, the Note Agreement, the Other Agreements, and
the Klemm Acquisition Documents shall be satisfactory in form and substance to
the Purchasers, and the Purchasers shall have received such other documents and
legal opinions in respect of any aspect or consequence of the transactions
contemplated hereby or thereby as it shall reasonably request.

 

7.             Representations and Warranties.  To induce the Purchasers to enter into this
Second Amendment, the Parent and the Company hereby represent and warrant to
the Purchasers (provided that on the Initial Second Amendment Closing Date, the
Parent and the Company are not making any of the following representations with
respect to Klemm):

 

(a)           Financial Condition. (i) To
the Company’ knowledge, (A) the audited consolidated balance sheet of Beneto
and its consolidated Subsidiaries as at December 31, 2002 and the related
consolidated statements of income and of cash flows for the fiscal year ended
on such date, and (B) the audited consolidated balance sheet of Klemm and its
consolidated Subsidiaries as at September 30, 2002, and the related
consolidated statements of income and of cash flows for the fiscal year ended
on such date, copies of which have heretofore been furnished to Purchasers, are
complete and correct in all material respects and present fairly in all
material respects the consolidated financial condition of each of Beneto and
Klemm and their respective Subsidiaries on a consolidated basis as at such
date, and the consolidated results of their operations and their cash flows for
the fiscal year then ended.  To the
Company’ knowledge, the unaudited consolidated balance sheet of each of Beneto
and Klemm and their respective consolidated Subsidiaries as at March 31, 2003,
and the related unaudited consolidated statements of income for the three-month
period, in the case of Beneto, and six-month period, in the case of Klemm,
ended on such date, copies of which have heretofore been furnished to
Purchasers, are complete and correct in all material respects and present
fairly in all material respects the consolidated financial condition of each of
Beneto and Klemm and their respective consolidated Subsidiaries as at such
date, and the consolidated results of their operations for the three-month
period, in the case of Beneto, and the six month period, in the case of Klemm,
then ended (subject to normal year-end audit adjustments).  All such financial statements (other than
the financial statements of Beneto for the three-month period ended March 31,
2003), including the related schedules and notes thereto, have been prepared in
accordance with GAAP applied consistently throughout the periods involved
(except as approved by such accountants or an officer of the company, as the
case may be, and as disclosed therein, and except that such unaudited financial
statements do not include footnotes). To the Company’ knowledge, the Beneto
Business and Klemm Business each did not have, at the date of the most recent
balance sheet referred to above, any material Guarantee Obligation (as defined
in the Senior Loan Agreement) which will survive closing of the Beneto
Acquisition or Klemm Acquisition respectively, contingent liability or
liability for taxes, or any long-term lease or unusual forward or long-term
commitment, including, without limitation, any interest rate or foreign
currency swap or exchange transaction or other financial derivative, which is
not reflected in the foregoing statements or in the notes thereto.  To the Company’s knowledge, during the
period from March 31, 2003 to and including the date hereof there has been no
sale, transfer or other disposition by the

 

22

 

Beneto Business and Klemm
Business of any material part of its business or property and no purchase or
other acquisition of any business or property (including any capital stock
of any other Person other than Klemm’s acquisition of the private fleet of U.S.
Oil) material in relation to the consolidated financial condition of Beneto and
Klemm at March 31, 2003 that after giving effect to the amendments provided for
herein and the additional loans contemplated under the Senior Loan Documents,
the representations and warranties contained in the Note Agreement (as updated pursuant to Sections 2(m)
and 2(n) of the Second Amendment), other than the representations and
warranties contained in Sections 4.1, 4.2(c) and (d), 4.3,
4.6, 4.7, 4.8, 4.11, 4.15, 4.20, 4.22, and 4.24, and the Other Agreements will
be true and correct in all material respects as if made on and as of the date
hereof and that no Default or Event of Default will have occurred and be
continuing (or, if any such representation or warranty is expressly stated to
have been made as of a specific date, as of such specific date).

 

(ii)           The pro  forma
consolidated balance sheet of the Parent and its consolidated Subsidiaries as
at March 31, 2003, certified by an officer of the Parent (the “Beneto/Klemm
Pro Forma Balance Sheet”), a copy of which has been provided to the Purchasers,
is the unaudited consolidated balance sheet of the Parent and its consolidated
Subsidiaries adjusted to give effect (as if such events had occurred on such
date) to (i) the B-K Acquisitions, (ii) the making of the new term loans
under the Senior Loan Documents, (iii) the application of the proceeds of such
new term loans in accordance with the terms of the Senior Loan Documents and
(iv) the payment of all fees and expenses related to the foregoing
transactions, as estimated in good faith as of the date of the Beneto/Klemm Pro
Forma Balance Sheet.  The Beneto/Klemm
Pro Forma Balance Sheet, together with the notes thereto, presents fairly in
all material respects, on a pro forma basis, the consolidated
financial position of the Parent and its Subsidiaries as of March 31, 2003,
assuming that the events specified in the preceding sentence had actually
occurred on such date.

 

(b)           Validity of Acquisition Documents.  Each of the Beneto Acquisition Documents and
the Klemm Acquisition Documents has been duly executed and delivered on behalf
of each Credit Party to any thereof and, to the knowledge of the Company and
the Parent, each other party thereto. Each of the Beneto Acquisition Documents
and Klemm Acquisition Documents constitutes the legal, valid and binding
obligation of each Credit Party to any thereof and, to the knowledge of the
Company and the Parent, each other party thereto, in each case subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors’ rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.  Neither the Company nor the Parent has any
knowledge that any representation or warranty of Beneto or Klemm contained in
the Beneto Acquisition Agreement or Klemm Acquisition Agreement is not, as of
the date hereof, true and correct in all material respects.

 

(c)           No Material Litigation.  No litigation or proceeding or, to the
Company’s knowledge, investigation of or before any arbitrator or Governmental
Entity is pending or, to the knowledge of the Company or the Parent, threatened
by or against any Credit Party or any of its Subsidiaries and prior to the consummation
of the B-K Acquisitions, to the Company’s and the

 

23

 

Parent’s knowledge, the Beneto Business or the Klemm Business, or
against any of its respective properties or revenues (i) with respect to the
Note Agreement, the Other Agreements, the Senior Loan Documents or any of the
transactions contemplated hereby or thereby, or (ii) which could
reasonably be expected to have a Material Adverse Effect.

 

(d)           Intellectual Property.  The Parent, the Company and each of its
Subsidiaries owns, or is licensed to use, all trademarks, tradenames,
copyrights, technology, know-how and processes necessary for the conduct of its
business (including immediately upon giving effect to the B-K Acquisitions) as
currently conducted except for those the failure to own or license which could
not reasonably be expected to have a Material Adverse Effect (the “Intellectual
Property”).  No claim has been
asserted and is pending by any Person challenging or questioning the use of any
such Intellectual Property or the validity or effectiveness of any such
Intellectual Property, nor does the Parent or the Company know of any valid
basis for any such claim.  To the
knowledge of the Company and the Parent, the use of such Intellectual Property
by the Parent, the Company and its Subsidiaries (including by Beneto LLC and/or
Klemm following the consummation of the Beneto Acquisition and the Klemm
Acquisition, as applicable) does not infringe on the rights of any Person,
except for such claims and infringements that, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.

 

(e)           No Burdensome Restrictions.  No Requirement of Law (as defined in the
Senior Loan Agreement) or Contractual Obligation of the Parent, the Company or
any of its Subsidiaries or, to the knowledge of the Company and the Parent in
respect of periods prior to the consummation of the B-K Acquisitions, the
Beneto Business or the Klemm Business could reasonably be expected to have a
Material Adverse Effect.

 

(f)            Accuracy and Completeness of
Information.  All factual
information, reports and other papers and data with respect to the Credit
Parties (other than projections and pro forma financial information) furnished,
and all factual statements and representations made, to the Purchasers by a
Credit Party, or on behalf of a Credit Party, were, at the time the same were
so furnished or made in writing, when taken together with all such other
factual information, reports and other papers and data previously so furnished
and all such other factual statements and representations previously so made,
complete and correct in all material respects, to the extent necessary to give
the Purchasers true and accurate knowledge of the subject matter thereof in all
material respects, and did not, as of the date so furnished or made, contain
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements contained therein not misleading in
light of the circumstances in which the same were made.  All projections and pro forma financial
information with respect to the Credit Parties furnished by or on behalf of a
Credit Party to the Purchasers were prepared and presented in good faith by or
on behalf of such Credit Party based upon good faith estimates and assumptions
believed by management of the Company to be reasonable at the time made, it
being recognized by the Purchasers that such financial information as it
relates to future events is not being viewed as fact and that actual results
during the period or periods covered by such financial information may differ
from the projected results set forth therein by a material amount.  No fact relating to the Company or its
Subsidiaries or its respective businesses (other than facts relating to the
economy in general) is known to a Credit Party which materially and adversely
affects or in the future is reasonably likely (so far as such Credit Party can
reasonably foresee) to

 

24

 

have a Material Adverse Effect which has not been set forth in the most
recent financial statements delivered pursuant to Section 6.1 of the Note
Agreement, Section 7(a) of this Second Amendment, or in such information,
reports, papers and data or otherwise disclosed in writing to the Purchasers
prior to the Initial Second Amendment Closing Date.

 

(g)           Labor Relations.  No Credit Party nor, to the knowledge of the
Company and the Parent, Beneto or Klemm, is engaged in any unfair labor
practice which could reasonably be expected to have a Material Adverse
Effect.  There is (i) no unfair
labor practice complaint pending or, to the knowledge of each Credit Party and
each of the Subsidiaries, threatened against a Credit Party, and prior to the
consummation of the B-K Acquisitions to the knowledge of the Company and the
Parent, the Beneto Business or the Klemm Business, before the National Labor
Relations Board which could reasonably be expected to have a Material Adverse
Effect and no grievance or arbitration proceeding arising out of or under a
collective bargaining agreement is so pending or, to the knowledge of the
Company and the Parent, threatened; (ii) no strike, labor dispute,
slowdown or stoppage pending or, to the knowledge of each Credit Party, threatened
against a Credit Party, and prior to the consummation of the B-K Acquisitions
to the knowledge of the Company and the Parent, the Beneto Business or the
Klemm Business and (iii) no union representation question existing with
respect to the employees of a Credit Party, and prior to the consummation of
the B-K Acquisitions to the knowledge of the Company and the Parent, the Beneto
Business or the Klemm Business, and no union organizing activities are taking
place with respect to any thereof.

 

(h)           Insurance.  Each Credit Party, and to the extent
constituting a part of, or in respect of risks assumed as part of, the Beneto
Business or the Klemm Business for periods prior to the consummation of the B-K
Acquisitions, Beneto and Klemm had, with respect to its properties and
business, insurance covering the risks, in the amounts, with the deductible or
other retention amounts, and with the carriers, listed on Schedule 4.24 to the
Note Agreement (as amended hereby), which insurance, in the case of each Credit
Party, meets the requirements of Section 6.13 of the Note Agreement as of
the date hereof and each Second Amendment Closing Date.

 

(i)            No Change.  Since March 31, 2003 there has been no
development or event which has had or could reasonably be expected to have a
Material Adverse Effect.

 

(j)            Existence; Compliance with Law.  Each of the Parent, each Company and each of
their Subsidiaries and, to the knowledge of the Company and the Parent, Beneto
and Klemm (a) is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, (b) has the corporate power
and authority, and the legal right, to own and operate its property, to lease
the property it operates as lessee and to conduct the business in which it is
currently engaged, (c) is duly qualified as a foreign corporation and in good
standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such
qualification, except where the failure to be so qualified would not have a
Material Adverse Effect and (d) is in compliance with all Requirements of Law
(as defined in the Senior Loan Agreement) except to the extent that the failure
to comply therewith could not, in the aggregate, have a Material Adverse
Effect.

 

25

 

(k)           No Default.  None of the Parent, the Company, nor any of
their Subsidiaries or, to the knowledge of the Company and the Parent, Beneto
(with respect to the Beneto Business) or Klemm, is in default under or with
respect to any of its Contractual Obligations in any respect which could
reasonably be expected to have a Material Adverse Effect.  No Default or Event of Default has occurred
and is continuing.

 

(l)            Ownership of Property; Liens.
 Each of the Parent, the Company, their
Subsidiaries and, to the knowledge of the Company and the Parent, Beneto (with
respect to the Beneto Business) and Klemm, has good record and marketable title
in fee simple to, or a valid leasehold interest in, all its real property, and
good title to, or a valid leasehold interest in, all its other material
property, and none of such property is subject to any Lien except as permitted
by Section 7.2 and except for Liens on the assets of the Beneto Business and
the Klemm Business which will be released on or prior to the closing of the
Beneto Acquisition and the Klemm Acquisition, respectively.

 

(m)          Taxes.  Each of the Parent, the Company, their
Subsidiaries and, to the knowledge of the Company and the Parent, Beneto and
Klemm, has filed or caused to be filed all tax returns which, to the knowledge
of the Company, are required to be filed and has paid all taxes shown to be due
and payable on said returns or on any assessments made against it or any of its
property and all other taxes, fees or other charges imposed on it or any of its
property by any Governmental Entity (other than any the amount or validity of
which are currently being contested in good faith by appropriate proceedings
and with respect to which reserves in conformity with GAAP have been provided
on the books of the Parent, the Company, their Subsidiaries and, to the
knowledge of the Company, Beneto and Klemm, as the case may be); no tax Lien
has been filed, and, to the knowledge of the Company, no claim is being
asserted, with respect to any such tax, fee or other charge.

 

(n)           Solvency.  On each Second Amendment Closing Date, both
before and after giving effect to the consummation of the B-K Acquisitions
which are to be consummated on, or which shall have been consummated prior to,
such date, and to the incurrence of all indebtedness and obligations being
incurred on or prior to such date in connection herewith and therewith, (i) the
amount of the “present fair saleable value” of the assets of the Company and of
the Company and their Subsidiaries, taken as a whole, will, as of such date,
exceed the amount of all “liabilities of the Company and of the Company and
their Subsidiaries, taken as a whole, contingent or otherwise”, as of such
date, as such quoted terms are determined in accordance with applicable federal
and state laws governing determinations of the insolvency of debtors, (ii) the
present fair saleable value of the assets of the Company and of the Company and
their Subsidiaries, taken as a whole, will, as of such date, be greater than
the amount that will be required to pay the liabilities of the Company and of
the Company and their Subsidiaries, taken as a whole, on their respective debts
as such debts become absolute and matured, (iii) neither the Company nor the
Company and their Subsidiaries, taken as a whole, will have, as of such date,
an unreasonably small amount of capital with which to conduct their respective
businesses, and (iv) each of the Company and the Company and their
Subsidiaries, taken as a whole, will be able to pay their respective debts as
they mature.  For purposes of this
Section 7(n), “debt” means “liability on a claim” and “claim” means any
(x) right to payment, whether or not such a right is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed,
undisputed, legal, equitable, secured or unsecured, and (y) right to an
equitable remedy for

 

26

 

breach of performance if such breach gives rise to a right to payment,
whether or not such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured or unmatured, disputed, undisputed, secured or unsecured.

 

8.             No Other Amendments.  Except as expressly amended hereby and by the First Amendment to
the Warrant Purchase Agreement, the Note Agreement, the Notes and the Other
Agreements shall remain in full force and effect in accordance with their
respective terms, without any waiver, amendment or modification of any
provision thereof.

 

9.             Counterparts. 
This Second Amendment may be executed by one or more of the parties
hereto on any number of separate counterparts and all of said counterparts
taken together shall be deemed to constitute one and the same instrument.

 

10.           Expenses.  The Company agree to pay and reimburse the
Purchasers for all of the out-of-pocket costs and expenses incurred by the
Purchasers in connection with the preparation, execution and delivery of this
Second Amendment, including, without limitation, the reasonable fees and
disbursements of Patton Boggs LLP, counsel to the Purchasers.

 

11.           Indemnification.  The Company and the Parent shall, jointly
and severally, indemnify, pay and hold harmless the Purchasers (and their
respective directors, officers, employees and agents) against any loss,
liability, cost or expense incurred in respect of the actions contemplated
hereby (except to the extent resulting from the gross negligence or willful
misconduct of the indemnified party).

 

12.           Applicable Law.  This Second Amendment shall be governed by,
and construed and interpreted in accordance with, the law of the State of New
York.

 

[SIGNATURE PAGES FOLLOW]

 

27

 

IN WITNESS WHEREOF, the
parties hereto have caused this Second Amendment to be duly executed and
delivered as of the day and year above written.

 

	
   

  	
  ADVANTAGE
  MANAGEMENT GROUP,

  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
      /s/
  Dennis Nash

  	
   

  
	
   

  	
   

  	
  Name: Dennis
  Nash

  
	
   

  	
   

  	
  Title: Chief
  Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  KENAN TRANSPORT COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
     /s/
  Dennis Nash

  	
   

  
	
   

  	
   

  	
  Name: Dennis
  Nash

  
	
   

  	
   

  	
  Title: Chief
  Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE KENAN ADVANTAGE
  GROUP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
     /s/
  Dennis Nash

  	
   

  
	
   

  	
   

  	
  Name: Dennis
  Nash

  
	
   

  	
   

  	
  Title: Chief
  Executive Officer

  

 

 

	
   

  	
  PURCHASERS:

  	 

	
   

  	
   

  	 

	
   

  	
  RSTW PARTNERS III, L.P.

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  RSTW Management, L.P.,

  	 

	
   

  	
   

  	
  its general partner

  	 

	
   

  	
   

  	
   

  	 

	
   

  	
   

  	
  By:

  	
  Rice Mezzanine Corporation,

  	 

	
   

  	
   

  	
   

  	
  its general partner

  	 

	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	
  By:

  	
   

  	
  /s/ Kurt Keene

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	
  Kurt G. Keene

  	 

	
   

  	
   

  	
   

  	
   

  	
  Managing Director

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  MASSACHUSETTS MUTUAL LIFE

  INSURANCE COMPANY

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  David L. Babson & Company Inc.,

  	 

	
   

  	
   

  	
  its Investment Adviser

  	 

	
   

  	
   

  	
   

  	 

	
   

  	
   

  	
  By:

  	
  /s/ Robert M. Shettle

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Robert M. Shettle

  	
   

  	 

	
   

  	
   

  	
  Title:

  	
  Managing Director

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  MASSMUTUAL CORPORATE INVESTORS

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/ Michael P. Hermsen

  	
   

  	 

	
   

  	
  Name:

  	
  Michael P. Hermsen

  	
   

  	 

	
   

  	
  Title:

  	
  Vice President

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  The foregoing is executed on behalf of MassMutual
  Corporate Investors, organized under a Declaration of Trust, dated September
  13, 1985, as amended from time to time. 
  The obligations of such Trust are not personally binding upon, nor
  shall resort be had to the property of, any of the Trustees, shareholders,
  officers, employees or agents of such Trust, but the Trust’s property only
  shall be bound.

  	 

																	

 

 

 

	
   

  	
  MASSMUTUAL PARTICIPATION INVESTORS

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael P. Hermsen

  	
   

  
	
   

  	
  Name:

  	
  Michael P. Hermsen

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  The foregoing is executed on behalf of MassMutual
  Participation Investors, organized under a Declaration of Trust, dated April
  7, 1988, as amended from time to time. 
  The obligations of such Trust are not personally binding upon, nor
  shall resort be had to the property of, any of the Trustees, shareholders,
  officers, employees or agents of such Trust, but the Trust’s property only
  shall be bound.

  
						

 

 

The undersigned, as Administrative Agent under that
certain Senior Subordination Agreement, dated May 30, 2003, by and among
Senior Lender and the Purchasers, as amended from time to time, hereby
acknowledges and consents to the terms and conditions of this Amendment.

 

	
   

  	
  CANADIAN IMPERIAL BANK OF COMMERCE,

  
	
   

  	
  as Administrative Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  

 

4Exhibit
10.11

 

THIRD
AMENDMENT

 

THIRD AMENDMENT, dated as of December 31, 2003 (this “Third
Amendment”), to the Note Purchase Agreement, dated as of April 30, 2001 (as
amended, supplemented or otherwise modified prior to the date hereof, the “Existing
Note Agreement”; as modified hereby and as further amended, supplemented or
otherwise modified from time to time, the “Note Agreement”), by and
among ADVANTAGE MANAGEMENT GROUP, INC., an Ohio corporation (“AMG”), and
KENAN TRANSPORT COMPANY, a North Carolina corporation (“Kenan” and
together with AMG collectively, the “Company”), THE KENAN ADVANTAGE
GROUP, INC., a Delaware corporation (the “Parent”), RSTW PARTNERS III,
L.P., a Delaware limited partnership (“RSTW”), MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY, a mutual life
insurance company established under the laws of the Commonwealth of
Massachusetts (“MMLI”), MASSMUTUAL
CORPORATE INVESTORS, a Massachusetts business trust (“MCI”), and MASSMUTUAL PARTICIPATION INVESTORS, a
Massachusetts business trust (“MPI”). 
MMLI, MCI and MPI are hereinafter referred to, collectively, as the “MassMutual
Investors”. RSTW and the MassMutual Investors are collectively referred to
herein as the “Purchasers”. 
Capitalized terms used but not otherwise defined herein shall have the
meanings assigned thereto by the Existing Note Agreement.

 

RECITALS

 

The Company and the
Parent have requested the Purchasers to agree to amend the Existing Note
Agreement to modify certain of the financial covenants set forth in Section
6.23(a) (Maximum Leverage Ratio) and Section 6.23(b) (Minimum Interest
Coverage).

 

The Purchasers are
willing to agree to such amendments, but only on the terms and subject to the
conditions set forth in this Third Amendment.

 

NOW, THEREFORE, in
consideration of the premises and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Company, the
Parent and the Purchasers hereby agree as follows:

 

1.             Amendments.

 

(a)           Section 6.23 of the Existing Note
Agreement is hereby amended by deleting subsection (a) in its entirety and
inserting in lieu thereof the following new subsection (a):

 

“(a)  Maximum Leverage Ratio.  The Company and the other Credit Parties
will at all times maintain a Leverage Ratio of the Credit Parties as of each
test date set forth on the table below not to exceed the ratio set forth
opposite such test date:

 

	
  Test Date

  	
   

  	
  Leverage
  Ratio

  	
   

  
	
  December 31, 2003

  	
   

  	
  4.68 to 1.00

  	
   

  
	
  March 31, 2004

  	
   

  	
  4.68 to 1.00

  	
   

  
	
  June 30, 2004

  	
   

  	
  4.68 to 1.00

  	
   

  
	
  September 30, 2004

  	
   

  	
  4.40 to 1.00

  	
   

  
	
  December 31, 2004

  	
   

  	
  4.13 to 1.00

  	
   

  
	
  March 31, 2005

  	
   

  	
  3.30
  to 1.00

  	
   

  
	
  June 30, 2005

  	
   

  	
  3.03
  to 1.00

  	
   

  
	
  September 30, 2005

  	
   

  	
  2.92
  to 1.00

  	
   

  
	
  December 31, 2005

  	
   

  	
  2.75
  to 1.00

  	
   

  
	
  March 31, 2006

  	
   

  	
  2.75
  to 1.00

  	
   

  
	
  June 30, 2006

  	
   

  	
  2.75
  to 1.00

  	
   

  
	
  September 30, 2006

  	
   

  	
  2.75
  to 1.00

  	
   

  
	
  December 31, 2006 and the last day of each fiscal
  quarter of the Parent thereafter

  	
   

  	
  2.50
  to 1.00”

  	
   

  

 

 

(b)           Section 6.23 of the Existing Note
Agreement is hereby amended by deleting subsection (b) in its entirety and
inserting in lieu thereof the following new subsection (b):

 

“(b)  Minimum Interest Coverage.  As of each test date set forth in the table
below, the Company and the other Credit Parties will maintain a ratio of
Consolidated EBITDA for the period of four consecutive fiscal quarters of the
Parent ending on such test date to Consolidated Interest Expense for such
period of four consecutive fiscal quarters of the Parent of not less than the
ratio set forth in the table below opposite such test date:

 

	
  Test Date

  	
   

  	
  Ratio

  	
   

  
	
  The last day of each fiscal quarter of the
  Parent,  from, and including,
  September 30, 2003  through, and
  including, December 31, 2004

  	
   

  	
  2.70 to 1.00

  	
   

  
	
  The last day of each fiscal quarter of the
  Parent,  from, and including, March
  31, 2005  through, and including,
  December 31, 2007

  	
   

  	
  3.15 to 1.00

  	
   

  
	
  The last day of each fiscal quarter of the
  Parent,  from, and including, March
  31, 2008 and thereafter

  	
   

  	
  3.25 to 1.00”

  	
   

  

 

2.             Conditions Precedent.  This Third Amendment shall become effective
on the first date on which all of the following conditions precedent shall have
been satisfied (the “Third Amendment Effective Date”):

 

(a)           Third Amendment.  The Purchasers shall have received this
Third Amendment, executed and delivered by a duly authorized officer of each of
the Company, the Parent and the Purchasers;

 

2

 

(b)           Other Documents.  The Purchasers shall have received such
other documents as the Purchasers or counsel to the Purchasers may reasonably
request; and

 

(c)           No Default.  After giving effect to amendments set forth
in Section 1 hereof, each Credit Party shall be in compliance with all of the
terms and provisions set forth in the Existing Note Agreement and the Other
Agreements on its part to be observed or performed and, no Default or Event of
Default shall have occurred and be continuing.

 

3.             Limited Effect.  Except as expressly amended and modified by
this Third Amendment, the Existing Note Agreement shall continue to be, and
shall remain, in full force and effect in accordance with its terms.  Each reference to the Note Agreement in any
of the Other Agreements shall be deemed to be a reference to the Note Agreement
as amended hereby.

 

4.             Counterparts.  This Third Amendment may be executed by one
or more of the parties hereto on any number of separate counterparts and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument.  Delivery of an executed
counterpart of a signature page to this Third Amendment by facsimile transmission
shall be effective as delivery of a manually executed counterpart thereof.

 

5.             Expenses.  The Company agrees to pay and reimburse the
Purchasers for all of the out-of-pocket costs and expenses incurred by the
Purchasers in connection with the preparation, execution and delivery of this
Third Amendment, including, without limitation, the reasonable fees and
disbursements of Patton Boggs LLP, counsel to the Purchasers.

 

6.             Indemnification.  The Company and the Parent shall, jointly
and severally, indemnify, pay and hold harmless the Purchasers (and their
respective directors, officers, employees and agents) against any loss,
liability, cost or expense incurred in respect of the financing contemplated
hereby or the use or the proposed use of proceeds thereof (except to the extent
resulting from the gross negligence or willful misconduct of the indemnified
party).

 

7.             Applicable Law.  This Third Amendment shall be governed by,
and construed and interpreted in accordance with, the laws of the State of New
York.

 

[SIGNATURE PAGES FOLLOW]

 

3

 

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

 

	
   

  	
  ADVANTAGE MANAGEMENT
  GROUP,

  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
      /s/
  Carl H. Young

  	
   

  
	
   

  	
   

  	
  Name: Carl H.
  Young

  
	
   

  	
   

  	
  Title: Chief
  Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  KENAN TRANSPORT COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
     /s/
  Carl H. Young

  	
   

  
	
   

  	
   

  	
  Name: Carl H.
  Young

  
	
   

  	
   

  	
  Title: Chief
  Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE KENAN ADVANTAGE
  GROUP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
     /s/
  Carl H. Young

  	
   

  
	
   

  	
   

  	
  Name: Carl H.
  Young

  
	
   

  	
   

  	
  Title: Chief
  Financial Officer

  

 

 

	
   

  	
  PURCHASERS:

  
	
   

  	
   

  
	
   

  	
  RSTW PARTNERS III, L.P.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  RSTW Management, L.P.,

  
	
   

  	
   

  	
  its general partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Rice Mezzanine Corporation,

  
	
   

  	
   

  	
   

  	
  its general partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
    /s/ Kurt G. Keene

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
    Kurt G. Keene

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
    Managing Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MASSACHUSETTS MUTUAL LIFE

  INSURANCE COMPANY

  
	
   

  	
   

  
	
   

  	
  By:

  	
  David L. Babson & Company Inc.,

  
	
   

  	
   

  	
  its Investment Adviser

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
       /s/
  Robert M. Shettle

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Robert M. Shettle

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Managing Director

  	
   

  
	
   

  	
   

  
	
   

  	
  MASSMUTUAL CORPORATE INVESTORS

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
      /s/ Richard E. Spencer II

  	
   

  
	
   

  	
  Name:

  	
   Richard E. Spencer II

  	
   

  
	
   

  	
  Title:

  	
    Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
  The foregoing is executed on behalf of MassMutual
  Corporate Investors, organized under a Declaration of Trust, dated September
  13, 1985, as amended from time to time. 
  The obligations of such Trust are not personally binding upon, nor
  shall resort be had to the property of, any of the Trustees, shareholders,
  officers, employees or agents of such Trust, but the Trust’s property only
  shall be bound.

  
												

 

5

 

	
   

  	
  MASSMUTUAL PARTICIPATION INVESTORS

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
      /s/ Richard E. Spencer II

  	
   

  
	
   

  	
  Name:

  	
    Richard E. Spencer II

  	
   

  
	
   

  	
  Title:

  	
    Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  The foregoing is executed on behalf of MassMutual
  Participation Investors, organized under a Declaration of Trust, dated April
  7, 1988, as amended from time to time. 
  The obligations of such Trust are not personally binding upon, nor
  shall resort be had to the property of, any of the Trustees, shareholders,
  officers, employees or agents of such Trust, but the Trust’s property only
  shall be bound.

  
						

 

6

 

The undersigned,
as Administrative Agent under that certain Senior Subordination Agreement,
dated April 30, 2001, as amended from time to time, by and among Senior Lender
and the Purchasers, as amended from time to time, hereby acknowledges and
consents to the terms and conditions of this Amendment.

 

	
   

  	
  CANADIAN IMPERIAL BANK OF COMMERCE,

  
	
   

  	
  as Administrative Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  

 

7

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