AMENDMENT NO. 2 TO AMENDED AND RESTATED CREDIT AGREEMENT

 

This Amendment No. 2 to Amended and Restated Credit Agreement (this "Agreement") dated as of March 3, 2006 is made by and among COVENANT ASSET MANAGEMENT, INC., a Nevada corporation (the "Borrower"), COVENANT TRANSPORT, INC., a Nevada corporation and the owner of 100% of the issued and outstanding common stock of the Borrower (the "Parent"), BANK OF AMERICA, N.A., a national banking association organized and existing under the laws of the United States ("Bank of America"), in its capacity as administrative agent for the Lenders (as defined in the Credit Agreement (as defined below)) (in such capacity, the "Agent"), each of the Lenders signatory hereto and each of the Guarantors (as defined in the Credit Agreement) signatory hereto.

WHEREAS, the Borrower, the Parent, the Agent and the Lenders have entered into that certain Amended and Restated Credit Agreement dated as of December 16, 2004, as amended by Amendment No. 1 to Amended and Restated Credit Agreement dated as of July 18, 2005 (as hereby amended and as from time to time hereafter further amended, modified, supplemented, restated, or amended and restated, the "Credit Agreement"; the capitalized terms used in this Agreement not otherwise defined herein shall have the respective meanings given thereto in the Credit Agreement), pursuant to which the Lenders have made available to the Borrower various revolving credit facilities, including a letter of credit facility and a swing line facility; and

WHEREAS, each of the Parent and the Guarantors has entered into a Facility Guaranty pursuant to which it has guaranteed certain or all of the obligations of the Borrower under the Credit Agreement and the other Loan Documents, and the Parent, the Borrower and the Guarantors have entered into various of the Security Instruments to secure their respective obligations and liabilities in respect the Loans and the Loan Documents; and

WHEREAS, the Parent and the Borrower have advised the Agent and the Lenders that they desire to amend certain provisions of the Credit Agreement as set forth below, and the Agent and the Lenders signatory hereto are willing so to effect such amendments contained herein on the terms and conditions contained in this Agreement;

NOW, THEREFORE, in consideration of the premises and further valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

1. Amendment to Credit Agreement. Subject to the terms and conditions set forth herein, the Credit Agreement is hereby amended by deleting the definition of "Total Letter of Credit Commitment" in its entirety and inserting the following in its place:

"Total Letter of Credit Commitment" means an amount not to exceed $85,000,000.

2. Conditions Precedent. This Agreement and the amendments to the Credit Agreement provided in Paragraph 1 shall be effective upon the satisfaction of the following conditions precedent:

(a) The Agent shall have received each of the following documents or instruments in form and substance reasonably acceptable to the Agent:

(i) ten (10) original counterparts of this Agreement, duly executed by the Parent, the Borrower, the Agent, each Guarantor, and each Lender; and

(ii) such other documents, instruments, opinions, certifications, undertakings, further assurances and other matters as the Agent shall reasonably request.

(b) all fees and expenses payable to the Agent and the Lenders (including the fees and expenses of counsel to the Agent) accrued to date shall have been paid in full to the extent invoiced prior to or on the effective date of this Agreement, but without prejudice to the later payment of accrued fees and expenses not so invoiced.

3. Consent of the Parent and the Guarantors. Each of the Parent and the Guarantors has joined in the execution of this Agreement for the purposes of consenting hereto and for the further purpose of confirming its guaranty of the Obligations of the Borrower pursuant to the Facility Guaranty to which the Parent or such Guarantor is party and its obligations under each other Loan Documents to which it is a party. The Parent and each Guarantor hereby consents, acknowledges and agrees to the amendments of the Credit Agreement set forth herein and hereby confirms and ratifies in all respects the Facility Guaranty and each other Loan Document to which the Parent or such Guarantor is a party and the enforceability of such Facility Guaranty and each such other Loan Document against the Parent and such Guarantor in accordance with its terms.

4. Representations and Warranties. In order to induce the Agent and the Lenders party hereto to enter into this Agreement, each of the Parent and the Borrower represent and warrant to the Agent and such Lenders as follows:

(a) The representations and warranties made by the Parent and the Borrower in Article VIII of the Credit Agreement (after giving effect to this Agreement) and by each Loan Party in each of the other Loan Documents to which it is a party are true and correct in all material respects on and as of the date hereof, except to the extent that such representations and warran-ties expressly relate to an earlier date;

(b) Since the date of the most recent financial reports of the Parent delivered pursuant to Section 9.1 of the Credit Agreement, no act, event, condition or circumstance has occurred or arisen which, singly or in the aggregate with one or more other acts, events, occurrences or conditions (whenever occurring or arising), has had or could reasonably be expected to have a Material Adverse Effect;

(c) The Persons appearing as Guarantors on the signature pages to this Agreement constitute all Persons who are required to be Guarantors pursuant to the terms of the Credit Agreement and the other Loan Documents, including without limitation all Persons who became Subsidiaries or were otherwise required to become Guarantors after the Closing Date as a result of any merger, acquisition or other reorganization, and each such Person has executed and delivered a Facility Guaranty;

(d) This Agreement has been duly authorized, executed and delivered by the Parent, the Borrower and the Guarantors party hereto and constitutes a legal, valid and binding obligation of such parties, except as may be limited by general principles of equity or by the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar law affecting creditors' rights generally; and

(e) No Default or Event of Default has occurred and is continuing either immediately prior to or immediately after the effectiveness of this Agreement.

5. Entire Agreement. This Agreement, together with all the Loan Documents (collectively, the "Relevant Documents"), sets forth the entire understanding and agreement of the parties hereto in relation to the subject matter hereof and supersedes any prior negotiations and agreements among the parties relative to such subject matter. No promise, condition, representation or warranty, express or implied, not herein set forth shall bind any party hereto, and not one of them has relied on any such promise, condition, representation or warranty. Each of the parties hereto acknowledges that, except as otherwise expressly stated in the Relevant Documents, no representations, warranties or commitments, express or implied, have been made by any party to the other. None of the terms or conditions of this Agreement may be changed, modified, waived or canceled orally or otherwise, except as permitted pursuant to Section 13.6 of the Credit Agreement.

6. Full Force and Effect of Agreement. Except as hereby specifically amended, modified or supplemented, the Credit Agreement and all other Loan Documents are hereby confirmed and ratified in all respects by each party hereto and shall be and remain in full force and effect according to their respective terms.

7. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original as against any party whose signature appears thereon, and all of which shall together constitute one and the same instrument.

8. Governing Law. This Agreement shall in all respects be governed by, and construed in accordance with, the laws of the state of Tennessee.

9. Enforceability. Should any one or more of the provisions of this Agreement be determined to be illegal or unenforceable as to one or more of the parties hereto, all other provisions nevertheless shall remain effective and binding on the parties hereto.

10. References. All references in any of the Loan Documents to the "Credit Agreement" shall mean the Credit Agreement, as amended hereby.

11. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Parent, the Borrower, the Agent and each of the Guarantors and Lenders, and their respective successors, assigns and legal representatives; provided, however, that neither the Parent, the Borrower nor any Guarantor, without the prior consent of the Required Lenders, may assign any rights, powers, duties or obligations hereunder.

12. Expenses. The Parent and the Borrower agree to pay to the Agent all reasonable out-of-pocket expenses of the Agent (including the fees and expenses of counsel to the Agent) incurred or arising in connection with the negotiation and preparation of this Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this instrument to be made, executed and delivered by their duly authorized officers as of the day and year first above written.

	BORROWER:
	COVENANT ASSET MANAGEMENT, INC., a Nevada corporation
	By:	/s/ Joey Hogan
	Name:	Joey Hogan
	Title:	EVP/CFO
	PARENT:
	COVENANT TRANSPORT, INC., a Nevada corporation
	By:	/s/ Joey Hogan
	Name:	Joey Hogan
	Title:	EVP/CFO

	GUARANTORS:
	COVENANT TRANSPORT, INC.,  a Tennessee corporation
	By:	/s/ Joey Hogan
	Name:	Joey Hogan
	Title:	EVP/CFO
	HAROLD IVES TRUCKING CO., an Arkansas corporation
	By:	/s/ Joey Hogan
	Name:	Joey Hogan
	Title:	EVP/CFO
	SOUTHERN REFRIGERATED TRANSPORT, INC., an Arkansas corporation
	By:	/s/ Joey Hogan
	Name:	Joey Hogan
	Title:	EVP/CFO
	COVENANT.COM, INC., a Nevada corporation
	By:	/s/ Joey Hogan
	Name:	Joey Hogan
	Title:	EVP/CFO
	CIP, INC., a Nevada corporation
	By:	/s/ Joey Hogan
	Name:	Joey Hogan
	Title:	EVP/CFO

	AGENT:
	BANK OF AMERICA, N.A., as Agent
	By:	/s/ Ronaldo Naval
	Name:	Ronaldo Naval
	Title:	Vice President

	LENDERS:
	BANK OF AMERICA, N.A.
	By:	/s/ Andrew Bunton
	Name:	Andrew Bunton
	Title:	Vice President

	NATIONAL CITY BANK OF KENTUCKY
	By:	/s/ Kevin L. Anderson
	Name:	Kevin L. Anderson
	Title:	Senior Vice President

	BRANCH BANKING AND TRUST COMPANY
	By:	/s/ Jim Valvilides
	Name:	Jim Valvilides
	Title:

	FIRST TENNESSEE BANK NATIONAL ASSOCIATION
	By:	/s/ Robert T. Lusk
	Name:	Robert T. Lusk
	Title:	Vice President

	AMSOUTH BANK
	By:	/s/ Walter Robinson
	Name:	Walter Robinson
	Title:	VP

	BNP PARIBAS
	By:	/s/ Mike Shryock
	Name:	Mike Shryock
	Title:	Managing Director
	By:	/s/ Aurora L. Abella
	Name:	Aurora L. Abella
	Title:	Vice President

	SUNTRUST BANK
	By:	/s/ William H. Crawford
	Name:	William H. Crawford
	Title:	Director