-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QlnFKea9ykCRCT1q+uem8Yqgp1WX2SLeVOBy1Nzvi3PGvHxSYDta+VigCMOkmjyY jOBTqzpL9z3JqTX7X7m+qg== 0000950168-96-001534.txt : 19960816 0000950168-96-001534.hdr.sgml : 19960816 ACCESSION NUMBER: 0000950168-96-001534 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960814 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: OLD DOMINION FREIGHT LINE INC/VA CENTRAL INDEX KEY: 0000878927 STANDARD INDUSTRIAL CLASSIFICATION: TRUCKING (NO LOCAL) [4213] IRS NUMBER: 560751714 STATE OF INCORPORATION: VA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-19582 FILM NUMBER: 96614624 BUSINESS ADDRESS: STREET 1: 1730 WESTCHESTER DR CITY: HIGH POINT STATE: NC ZIP: 27260 BUSINESS PHONE: 9198895000 MAIL ADDRESS: STREET 1: P O BOX 2006 CITY: HIGH POINT STATE: NC ZIP: 27261 10-Q 1 OLD DOMINION FREIGHT LINE, INC. 10-Q FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1996 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________ to _________. COMMISSION FILE NUMBER: 0-19582 OLD DOMINION FREIGHT LINE, INC. (Exact name of registrant as specified in its charter) VIRGINIA 56-0751714 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1730 WESTCHESTER DRIVE HIGH POINT, NC 27262 (Address of principal executive offices) TELEPHONE NUMBER (910) 889-5000 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X . No . As of August 8, 1996, there were 8,345,608 shares of the registrant's Common Stock ($.10 par value) outstanding. PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS OLD DOMINION FREIGHT LINE, INC. CONSOLIDATED STATEMENTS OF OPERATIONS
QUARTER ENDED SIX MONTHS ENDED --------------------------------- ---------------------------------- JUNE 30, June 30, JUNE 30, June 30, 1996 1995 1996 1995 (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA) (UNAUDITED) (Unaudited) (UNAUDITED) (Unaudited) - ----------------------------------------------------------------------- --------------- --------------- ----------------- Revenue from operations $74,862 $ 60,371 $143,124 $ 118,115 -------------- --------------- --------------- ---------------- Operating expenses: Salaries, wages and benefits 41,202 33,180 79,418 65,339 Purchased transportation 5,859 4,533 11,415 8,920 Operating supplies and expenses 7,751 5,594 14,949 10,654 Depreciation and amortization 4,011 3,221 7,783 6,394 Building and office equipment rents 1,788 1,432 3,467 2,784 Operating taxes and licenses 3,207 2,531 6,293 4,894 Insurance and claims 2,688 2,031 5,094 4,115 Communications and utilities 1,443 1,170 2,925 2,334 General supplies and expenses 2,798 2,597 5,522 5,019 Miscellaneous expenses 722 492 1,169 842 -------------- --------------- --------------- ---------------- Total operating expenses 71,469 56,781 138,035 111,295 -------------- --------------- --------------- ---------------- Operating income 3,393 3,590 5,089 6,820 -------------- --------------- --------------- ---------------- Other deductions: Interest expense, net 649 294 1,195 569 Other expense, net 94 94 184 175 -------------- --------------- --------------- ---------------- Total other deductions 743 388 1,379 744 -------------- --------------- --------------- ---------------- Income before income taxes 2,650 3,202 3,710 6,076 Provision for income taxes 1,007 1,233 1,410 2,339 -------------- --------------- --------------- ---------------- Net income $ 1,643 $ 1,969 $ 2,300 $ 3,737 ============== =============== =============== ================ INCOME PER COMMON SHARE: Net income $ 0.20 $ 0.24 $ 0.28 $ 0.45 Average number of shares outstanding 8,345,608 8,359,792 8,345,608 8,362,053
See notes to consolidated financial statements. 2 OLD DOMINION FREIGHT LINE, INC. CONSOLIDATED BALANCE SHEETS
JUNE 30, December 31, 1996 1995 (In thousands, except share data) (UNAUDITED) (Audited) - ------------------------------------------------------------------------------------------------------------------ ASSETS Current assets: Cash and cash equivalents $ 4,027 $ 986 Customer receivables, less allowances of $5,309 and $5,083, respectively 40,691 34,378 Other receivables 791 3,042 Tires on equipment 4,085 3,939 Prepaid expenses 3,509 5,221 Deferred income taxes 2,899 2,899 ------------------ ------------------- Total current assets 56,002 50,465 ------------------ ------------------- Property and equipment: Revenue equipment 123,342 110,175 Land and structures 32,239 24,188 Other equipment 16,029 13,543 Leasehold improvements 538 508 ------------------ ------------------- Total property and equipment 172,148 148,414 Less accumulated depreciation and amortization (67,856) (60,350) ------------------ ------------------- Net property and equipment 104,292 88,064 Other assets, less insurance policy loans of $1,733 at June 30, 1996, and December 31, 1995, respectively 5,005 4,817 ------------------ ------------------- Total assets $ 165,299 $ 143,346 ================== ===================
3 OLD DOMINION FREIGHT LINE, INC. CONSOLIDATED BALANCE SHEETS (CONTINUED)
JUNE 30, December 31, 1996 1995 (In thousands, except share data) (UNAUDITED) (Audited) - ------------------------------------------------------------------------------------------------------------------ LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 12,398 $ 10,504 Compensation and benefits 7,069 5,095 Claims and insurance accruals 9,333 8,645 Other accrued liabilities 1,395 1,423 Income taxes payable 287 - Current maturities of long-term debt 4,623 6,194 ------------------ ------------------- Total current liabilities 35,105 31,861 ------------------ ------------------- Long-term debt 40,134 24,022 Other non-current liabilities 7,573 8,383 Deferred income taxes 11,403 10,296 ------------------ ------------------- Total long-term liabilities 59,110 42,701 ------------------ ------------------- Stockholders' equity: Common stock - $.10 par value, 25,000,000 shares authorized, 8,345,608 shares outstanding at June 30, 1996, and December 31, 1995, respectively 835 835 Capital in excess of par value 23,352 23,352 Retained earnings 46,897 44,597 ------------------ ------------------- Total stockholders' equity 71,084 68,784 Commitments and contingencies - - ------------------ ------------------- Total liabilities and stockholders' equity $ 165,299 $ 143,346 ================== ===================
See notes to consolidated financial statements. 4 OLD DOMINION FREIGHT LINE, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS
Six Months Ended June 30, ------------------------------- (In thousands) 1996 1995 - -------------------------------------------------------------------- --------------- -------------- Cash flows from operating activities: Net income $ 2,300 $ 3,737 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 7,783 6,394 Deferred income taxes 1,107 - Loss (Gain) on sale of property and equipment 134 (519) Changes in assets and liabilities: Receivables, net (4,062) (1,717) Tires on equipment (146) 243 Prepaid expenses and other assets 1,524 725 Accounts payable 1,894 1,566 Compensation, benefits and other accrued liabilities 1,946 965 Estimated liability for claims 688 (2,182) Income taxes payable 287 (517) Other liabilities (810) 1,547 --------------- -------------- Net cash provided by operating activities 12,645 10,242 --------------- -------------- Cash flows from investing activities: Purchase of property and equipment (24,185) (15,758) Proceeds from sale of property and equipment 40 854 Net cash used in investing activities (24,145) (14,904) --------------- -------------- Cash flows from financing activities: Proceeds from issuance of long term debt 37,000 - Principal payments under debt and capital lease agreements (10,459) (3,869) Net proceeds (payments) on short-term revolving line of credit (12,000) 7,300 Purchase and retirement of restricted stock - 251 --------------- -------------- Net cash provided by financing activities 14,541 3,682 --------------- -------------- Increase (Decrease) in cash and cash equivalents 3,041 (980) Cash and cash equivalents at beginning of period 986 2,393 --------------- -------------- Cash and cash equivalents at end of period $ 4,027 $ 1,413 =============== ==============
See notes to consolidated financial statements. 5 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. The consolidated financial statements are unaudited and reflect all adjustments (consisting only of normal recurring adjustments) which are, in the opinion of management, necessary for a fair presentation of the financial position and operating results for the interim periods. Certain prior year amounts have been reclassified to conform with the current year presentation. The consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995. The results of operations for the six months ended June 30, 1996, are not necessarily indicative of the results for the entire fiscal year ending December 31, 1996. 2. On June 15, 1996, the Company entered into a $30,000,000 private placement of debt through a Note Purchase Agreement with two insurance companies. The Note Purchase Agreement consists of a $10,000,000, 7.3% Senior Note due December 15, 2002, and a $20,000,000, 7.59% Senior Note due June 15, 2006. The 2002 note provides for semi-annual interest payments with increasing annual principal payments beginning December 15, 1998. The 2006 note provides for semi-annual interest payments with equal annual principal payments beginning June 15, 2000. The Note Purchase Agreement, which is uncollateralized, contains certain financial covenants that limit the Company's debt to total capital ratio, requires stated levels of tangible net worth and specifies an interest coverage ratio. Proceeds of the private placement were used to reduce the outstanding line of credit and short-term notes by $26,650,000 with the remaining proceeds to be used during the third quarter of 1996 for planned capital expenditures. As a result of the private placement of debt, the committed Credit Agreement that previously provided a $25,000,000 line of credit and a $15,000,000 letter of credit facility was amended to a $15,000,000 line of credit and a $17,500,000 letter of credit facility. 3. Net income per share of common stock is based on the weighted average number of shares outstanding during each period. 6 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS FOR THE THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 1996 VS. JUNE 30, 1995 EXPENSES AS A PERCENTAGE OF REVENUE FROM OPERATIONS
THREE MONTHS ENDED SIX MONTHS ENDED JUNE 30, JUNE 30, 1996 1995 1996 1995 ------------------------------- ------------------------------ Revenue from operations 100.0% 100.0% 100.0% 100.0% ------------- ------------- ------------- ------------- Operating expenses: Salaries, wages and benefits 55.0 55.0 55.5 55.3 Purchased transportation 7.8 7.5 8.0 7.6 Operating supplies and expenses 10.4 9.3 10.4 9.0 Depreciation and amortization 5.4 5.3 5.4 5.4 Building and office equipment rents 2.4 2.4 2.4 2.4 Operating taxes and licenses 4.3 4.2 4.4 4.1 Insurance and claims 3.6 3.4 3.6 3.5 Communications and utilities 1.9 1.9 2.0 2.0 General supplies and expenses 3.7 4.3 3.9 4.2 Miscellaneous expenses 1.0 0.8 0.8 0.7 ------------- ------------- ------------- ------------- Total operating expenses 95.5 94.1 96.4 94.2 ------------- ------------- ------------- ------------- Operating income 4.5 5.9 3.6 5.8 Interest expense, net 0.9 0.5 0.8 0.5 Other expense, net 0.1 0.1 0.2 0.1 ------------- ------------- ------------- ------------- Income before income taxes 3.5 5.3 2.5 5.2 Provision for income taxes 1.3 2.0 1.0 2.0 ------------- ------------- ------------- ------------- Net income 2.2% 3.3% 1.6% 3.2% ============= ============= ============= =============
7 RESULTS OF OPERATIONS THREE MONTHS ENDED JUNE 30, 1996, VERSUS THREE MONTHS ENDED JUNE 30, 1995 Net revenue for the second quarter of 1996 was $74,862,000, an increase of 24.0%, compared to $60,371,000 for the same quarter of 1995. Less than truckload (LTL) tonnage increased 23.7% due primarily to a 20.5% increase in LTL shipments as well as an increase in the LTL weight per shipment. The increase in LTL shipments reflects the geographical expansion in 1995 into 15 additional terminals in 10 new states. Average LTL revenue per hundredweight was $11.17 for the current second quarter compared to $11.00 for the second quarter of 1995, an increase of 1.5%. This increase reflects a rate increase that went into effect on January 1, 1996, and a continuing effort to improve the Company's revenue yield during the second quarter of the current year. An increase of 2.6% in the LTL weight per shipment, combined with the increased revenue per hundredweight, resulted in a 4.3% increase in the revenue per LTL shipment to $116.97 from $112.20. Operating expenses as a percentage of net revenue (operating ratio) increased to 95.5% for the second quarter 1996 from 94.1% for the same period of 1995. The increase in the operating ratio was due mainly to increases in operating supplies and expenses, which increased to 10.4% of revenue from 9.3%. Most of the increase in operating supplies and expenses was due to fuel expense, which increased to 4.8% of net revenue from 3.8%, excluding fuel taxes. Fuel cost per gallon, excluding fuel taxes, was 12.6 cents, or 20.8%, higher during the current second quarter compared to the second quarter of 1995. To offset a portion of this increased expense, the Company imposed a fuel surcharge effective on May 13, 1996. The increase in fuel costs, after the offsetting effect of the fuel surcharge, reduced the Company's earnings by 1.3 cents per share in the second quarter. In addition to higher fuel expense, maintenance costs increased to 2.3% of net revenue compared to 2.1%. Capital expenditures during the second quarter of 1996 were $13,010,000 resulting in an increase in depreciation expense to 5.4% of revenue compared to 5.3% for the same quarter of the previous year. Interest expense increased to .9% of revenue in the second quarter of 1996 from .5% for the same quarter of 1995. The increase is due to a higher average outstanding debt for the quarter compared to the same quarter the previous year. Long-term debt outstanding was $44,757,000 at June 30, 1996, compared to $22,056,000 at June 30, 1995. The increased debt is due mainly to significant planned capital expenditures of $24,185,000 in the first half of 1996. Net income was $1,643,000 for the quarter ended June 30, 1996, a decrease of 16.6%, compared to $1,969,000 for the same quarter the previous year. The effective tax rate was approximately 38% compared to 38.5% for the same period of 1995. SIX MONTHS ENDED JUNE 30, 1996, VERSUS SIX MONTHS ENDED JUNE 30, 1995 Net revenue for the six months ended June 30, 1996, was $143,124,000, an increase of 21.2%, compared to $118,115,000 for the same period of 1995. LTL tonnage increased 21.8% due primarily to an increase in LTL shipments as well as an increase in the LTL weight per shipment. This increase in LTL shipments reflects the geographical expansion throughout 1995 into 15 additional terminals in 10 new states. LTL shipments were up by 19.6%, and the weight per shipment increased 1.8% during the six-month period of the current year. Average LTL revenue per hundredweight was $11.11 for the six months ended June 30, 1996, compared to $10.94 for the same period of 1995. This increase reflects a rate increase that went into effect on January 1, 1996, and a continuing effort to improve the Company's revenue yield. The increase in the LTL weight per shipment, combined with a 1.6% increase in revenue per hundredweight, resulted in a 3.4% increase in the revenue per LTL shipment to $116.10 from $112.33. 8 Operating expenses as a percentage of net revenue (operating ratio) were 96.4% for the six months ended June 30, 1996, compared to 94.2% for the same period of 1995. Combined, salaries, wages and benefits, purchased transportation, operating supplies and expenses and operating taxes and licenses increased to 78.3% of net revenue compared to 76.0%. With the exception of increased fuel cost, these increases reflect lower density in linehaul lanes as a result of the Company's geographical expansion beginning in the first quarter of 1995. Density, expressed as average linehaul laden load, was down 7.2% compared to pre-expansion periods. The decline in density was generally a result of protecting the Company's superior delivery standards through scheduled linehaul service. As this density improves through continued increases in market share, the linehaul laden load average will increase, and these costs will decrease to more historical levels. Much of the increase in the operating ratio was due to increases in operating supplies and expenses, which increased to 10.4% of revenue for the current six-month period from 9.0% for the same period of 1995. Most of the increase in operating supplies and expenses was due to fuel expense, excluding fuel taxes, which increased to 4.8% of revenue from 3.8%. Fuel cost per gallon, excluding fuel taxes, was 10.7 cents, or 17.5%, higher during the current six-month period compared to the same period of 1995. This increase resulted in a negative effect on earnings per share of 7.6 cents per share, of which 3.3 cents per share was recouped as a result of a fuel surcharge (reflected in net revenue) imposed on May 13, 1996. In addition to higher fuel expense, maintenance costs increased to 2.3% of net revenue compared to 1.9% in the same period of 1995. The Company's net interest expense was .8% of revenue for the six months ended June 30, 1996, compared to .5% for the same period of 1995 due to the increase in average outstanding debt in 1996. Net income was $2,300,000 for the six months ended June 30, 1996, a decrease of 38.5%, compared to $3,737,000 for the same six-month period the previous year. The effective tax rate was 38.0% for 1996 and 38.5% for 1995. LIQUIDITY AND CAPITAL RESOURCES In order to maintain an appropriate equipment replacement cycle and allow for future growth, the Company currently anticipates capital expenditures of between $35,000,000 and $37,000,000 for 1996. These expenditures include approximately $10,000,000 to $12,000,000 for larger terminals in existing coverage areas that were either outgrown or previously leased. Capital expenditures will be financed principally by internally generated cash flow supplemented with borrowings. Capital expenditures during the quarter and six months ended June 30, 1996, were approximately $13,010,000 and $24,185,000, respectively. Long-term debt, including current maturities, increased to $44,757,000 at June 30, 1996, from $30,216,000 at December 31, 1995. The outstanding long-term debt at June 30, 1996, includes debt proceeds of $3,350,000 held in working capital for planned capital expenditures during the third quarter of the current year. The Company generally meets its working capital needs with cash generated from operations. Working capital requirements are generally higher during the first and fourth quarters because of seasonal declines in revenue and annual payments of property taxes, equipment tags and licenses. On June 15, 1996, the Company entered into a $30,000,000 private placement of debt through a Note Purchase Agreement with two insurance companies. The Note Purchase Agreement consists of a $10,000,000, 7.3% Senior Note due December 15, 2002, and a $20,000,000, 7.59% Senior Note due June 15, 2006. The 2002 note provides for semi-annual interest payments with increasing annual principal payments beginning December 15, 1998. The 2006 note provides for semi-annual interest payments with equal annual principal payments beginning June 15, 2000. The Note Purchase Agreement, which is uncollateralized, contains certain financial covenants that limit the Company's debt to total capital ratio, requires stated levels of tangible net worth and specifies an interest coverage ratio. Proceeds of the private placement were used to reduce the outstanding line of credit and short-term notes by $26,650,000 with the remaining proceeds to be used during the third quarter of 1996 for planned capital expenditures. As a result of the private placement of debt, the committed Credit Agreement that previously provided a $25,000,000 line of credit and a $15,000,000 letter of credit facility was amended to a $15,000,000 line of credit and a $17,500,000 letter of credit facility. Interest on the line of credit is charged at rates that can vary based upon a certain financial performance ratio and the stated period of time the borrowings are 9 outstanding. The applicable interest rate is based upon LIBOR plus .6% for periods of 30-180 days and prime minus 1% for periods less than 30 days. The Company has also entered into a separate International Swap Dealers Association (ISDA) Agreement that hedges the interest rate on a portion of the outstanding amount on the credit line over a specified term. Pursuant to this agreement, as of June 30, 1996, the Company has fixed $3,500,000 of the outstanding credit line at a rate of 6.54% through June 19, 1998. A fee of .2% is charged on the unused portion of the $32,500,000 line of credit and letter of credit facility, and a fee of .6% is charged on outstanding letters of credit. At June 30, 1996, there were $5,500,000 outstanding borrowings on the line of credit and $12,150,000 outstanding on the letter of credit facility, which is required for self-insured retention reserves for bodily injury, property damage and workers' compensation insurance. The Company believes that there are sufficient credit lines and capacity to meet seasonal and long-term financial needs. INFLATION Most of the Company's expenses are affected by inflation, which will generally result in increased costs. During the second quarter and for the six-month period ended June 30, 1996, the effect of inflation on the Company's results of operations was minimal. SEASONALITY The Company's operations are subject to seasonal trends common in the trucking industry. Operating results in the winter months of the first and fourth quarters are normally lower due to reduced shipments. The second and third quarters are stronger due to increased demand for services during the spring and summer months. ENVIRONMENTAL The Company is subject to federal, state and local environmental laws and regulations, particularly relative to underground storage tanks ("UST's"). The Company is in compliance with applicable environmental laws and regulations relating to UST's and does not believe that the cost of future compliance should have a material adverse effect on the Company's operations or financial condition. 10 PART II. OTHER INFORMATION ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS The Company held its 1996 Annual Meeting of Stockholders on May 6, 1996. The only item on the agenda was the election of directors for which votes were cast or withheld as follows: Nominee For Withheld ------- --- -------- Earl E. Congdon 7,265,413 2,510 John R. Congdon 7,265,413 2,510 John A. Ebeling 7,265,413 2,510 Harold G. Hoak 7,265,413 2,510 Franz F. Holscher 7,265,413 2,510 ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K a) Exhibits: Exhibit No. Description 4.4.3 Second Amendment to the Credit Agreement between Old Dominion Freight Line, Inc. and First Union National Bank of North Carolina, dated April 29, 1996 4.4.4 Third Amendment to the Credit Agreement between Old Dominion Freight Line, Inc. and First Union National Bank of North Carolina, dated June 15, 1996 4.5 Note Purchase Agreement between Nationwide Life Insurance Company, New York Life Insurance Company and Old Dominion Freight Line, Inc., dated June 15, 1996 4.5.1 Form of notes issued by Company pursuant to Note Purchase Agreement between Nationwide Life Insurance Company, New York Life Insurance Company and Old Dominion Freight Line, Inc., dated June 15, 1996 b) Reports on Form 8-K: No reports on Form 8-K were filed during the quarter ended June 30, 1996. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. OLD DOMINION FREIGHT LINE, INC. DATE: August 9, 1996 J. WES FRYE ----------------- ------------------ J. Wes Frye Treasurer (Principal Financial Officer) DATE: August 9, 1996 JOHN P. BOOKER III ----------------- ------------------ John P. Booker III Controller (Principal Accounting Officer) 11 EX-4 2 EXHIBIT 4.4.3 EXHIBIT 4.4.3 April 29, 1996 SECOND AMENDMENT TO CREDIT AGREEMENT Old Dominion Freight Line, Inc. 1730 Westchester Drive High Point, North Carolina 27261 Ladies and Gentlemen: Reference is hereby made to that certain Credit Agreement, dated June 14, 1995, as amended by First Amendment thereto, dated February 2, 1996 (the Credit Agreement, as amended, being hereinafter referred to as the "Credit Agreement"), between Old Dominion Freight Line, Inc., a Virginia corporation ("Borrower"), and First Union National Bank of North Carolina, a national banking association ("Bank"), pursuant to which Bank, upon the terms and subject to the conditions contained therein, has agreed to make a credit facility of $40,000,000 available for Borrower's use from time to time during the term of the Credit Agreement, comprised of a $25,000,000 revolving line of credit evidenced by Borrower's $25,000,000 Amended and Restated Revolving Credit Note, dated February 2, 1996, and a $15,000,000 letter of credit facility evidenced by the Credit Agreement. All capitalized terms used herein without definition shall have the meanings ascribed to such terms in the Credit Agreement. Borrower has requested that Bank amend the definition of Gross Rents as set forth in Section 1.1 of the Credit Agreement, and Bank has agreed to such request. Therefore, Borrower and Bank have agreed to amend Section 1.1 of the Credit Agreement by deleting the definition of "Gross Rents" in its entirety and by substituting in lieu thereof the following: "Gross Rents" shall mean the aggregate of all payments which Borrower is required to make pursuant to the terms of any lease by Borrower, which lease, including any renewals thereof, has a term of six (6) months or longer, of any real or personal Property consisting of tractors, trailers, trucks, forklifts and terminals. Except as herein expressly amended, the Credit Agreement shall remain unchanged and in full force and effect in accordance with its terms. Nothing contained herein shall constitute (a) a waiver by Bank of any Event of Default under the Credit Agreement or any of the other Loan Documents, or (b) a waiver by Bank of any rights or remedies of Bank against Borrower. If this letter correctly states the terms of our agreement to amend the Credit Agreement as herein set forth, please so indicate in the space marked below for your signature and return a fully executed copy to us. Yours very truly, FIRST UNION NATIONAL BANK OF NORTH CAROLINA By: JERRY HIGHSMITH Title: SENIOR VICE PRESIDENT Agreed to and accepted this 29th day of April, 1996. OLD DOMINION FREIGHT LINE, INC. By: J. WES FRYE Title: CHIEF FINANCIAL OFFICER EX-4 3 EXHIBIT 4.4.4 EXHIBIT 4.4.4 THIRD AMENDMENT TO CREDIT AGREEMENT THIS THIRD AMENDMENT TO CREDIT AGREEMENT (the "Amendment"), dated as of the 15th day of June, 1996, is made by and between OLD DOMINION FREIGHT LINE, INC., a Virginia corporation (the "Borrower"), and FIRST UNION NATIONAL BANK OF NORTH CAROLINA, a national banking association (the "Bank"), to the Credit Agreement, dated June 14, 1995, as amended by First Amendment thereto, dated February 2, 1996, and by Second Amendment thereto, dated April 29, 1996 (the Credit Agreement as amended, modified, restated or supplemented from time to time, being called the "Credit Agreement"). All capitalized terms used herein without definition shall have the meanings ascribed to such terms in the Credit Agreement. RECITALS A. Pursuant to the Credit Agreement, the Bank has made available to the Borrower a Revolving Line of Credit in the amount of $25,000,000, a Letter of Credit Facility in the amount of $15,000,000, an additional revolving line of credit in the amount of $5,000,000, and an additional revolving line of credit in the amount of $2,000,000. B. The Borrower has requested that the Bank (i) decrease the amount of the Revolving Line of Credit Commitment from the sum of $25,000,000 to the sum of $15,000,000, (ii) increase the amount of the Letter of Credit Facility Commitment from the sum of $15,000,000 to the sum of $17,500,000, and (iii) amend certain financial and other covenants set forth in the Credit Agreement. C. The Bank has agreed to such requests, and the Borrower and the Bank have therefore agreed to amend the Credit Agreement as set forth herein. STATEMENT OF AGREEMENT NOW, THEREFORE, for and in consideration of the premises and other good and valuable consideration, the receipt and sufficiency of which are hereby expressly acknowledged, the Borrower and the Bank hereby agree as follows: ARTICLE I AMENDMENTS TO CREDIT AGREEMENT Effective as of the date of the consummation of the transactions contemplated by that certain Master Note Purchase Agreement, dated on or about the date hereof, and receipt by the Borrower of the proceeds thereof (the "Placement"), the Credit Agreement is hereby amended as follows: 1.1 Recitals. The third recital of the Credit Agreement is amended in its entirety to read as follows: "WHEREAS, Bank has agreed to extend financial accommodations for such purposes to Borrower in the form of a (a) $15,000,000 revolving line of credit, which may be increased as evidenced by additional notes executed or to be executed by Borrower to the order of Bank, and (b) $17,500,000 standby letter of credit facility to be made in accordance with, and subject to, the terms and conditions set forth below;" 1.2 Defined Terms. Section 1.1 of the Credit Agreement is amended as follows: (a) The following definitions are amended in their entirety to read as follows: "Applicable Margin" shall mean, at any date of determination thereof, a sum equal to the percentage set forth below based on the Fixed Charge Coverage Ratio on such date, which shall be determined on the Closing Date and at the end of each Interest Period selected by Borrower and, if appropriate, the Applicable Margin shall be reduced or increased for the next Interest Period selected by Borrower, according to the following schedule: Fixed Charge Applicable Margin Applicable Margin Applicable Margin Coverage Ratio For LIBOR Rate Loan for CD Rate Loan for Prime Rate Loan Equal to or 0.50% 0.625% -1.0% greater than 3.75 to 1.0 Equal to or 0.60% 0.725% -1.0% greater than 2.75 to 1.0 but less than 3.75 to 1.0 Less than 2.75 0.75% 0.875% -1.0% to 1.0 "Gross Rents" shall mean the aggregate amount of all payments which Borrower is required to make pursuant to the terms of any lease by Borrower of any building or office equipment or revenue producing equipment which lease has a term of more than six (6) months, including renewals thereof. "Letter of Credit Facility Commitment" shall mean $17,500,000. "Revolving Credit Note" shall mean the promissory note of Borrower executed and delivered to Bank pursuant to Section 2.2 hereof evidencing Borrower's obligation to repay the Revolving Loans, as well as any Additional Notes of Borrower executed and delivered to Bank evidencing Borrower's obligation to repay additional loans made by Bank to Borrower, together with any amendments, modifications and supplements thereto, and any renewals, replacements or extensions thereof, in whole or in part. "Revolving Line of Credit Commitment" shall mean $15,000,000. "Revolving Loans" shall mean the loans made by Bank to Borrower under the Revolving Line of Credit and the loans made by Bank to Borrower evidenced by Additional Notes. (b) The following definitions are added in the -3- appropriate alphabetical sequence: "Additional Notes" shall mean any promissory notes of Borrower executed and delivered to Bank to evidence loans made pursuant to the terms of this Agreement, which loans are in addition to the Revolving Loans made under the Revolving Line of Credit Commitment. All Additional Notes shall evidence Obligations of Borrower to Bank and shall be governed by the terms and provisions of this Agreement. "Funded Debt" shall mean all Indebtedness for money borrowed of Borrower, whether direct or contingent, as determined in accordance with Generally Accepted Accounting Principles, including, without limitation, Capitalized Lease Obligations, the deferred purchase price of any Property or asset or Indebtedness evidenced by a promissory note, bond, guaranty or similar written obligation for the payment of money (including, but not limited to, conditional sales or similar title retention agreements). "Total Capitalization" shall mean, at any date of determination thereof, the sum of Funded Debt and Tangible Net Worth. (c) The definition of "Current Maturities of Long Term Debt" is amended by deleting in line 2 thereof the words "Money Borrowed Indebtedness" and by substituting in lieu thereof the words "Funded Debt". (d) The definition of "Money Borrowed Indebtedness" is hereby deleted. 1.3 Negative Covenants. Section 8 of the Credit Agreement is amended by deleting Sections 8.3, Money Borrowed Indebtedness, 8.10, Sale and Leasebacks, 8.16, Indebtedness to Tangible Net Worth, and 8.17, Fixed Charge Coverage Ratio, in their entirety and by substituting in lieu thereof the following: "8.3 Funded Debt. Create, incur or suffer to -4- exist any Funded Debt except for: (a) the Obligations owed to Bank under this Agreement and the other Loan Documents; (b) the Funded Debt set forth on Exhibit J attached hereto; (c) Permitted Purchase Money Indebtedness; and (d) Indebtedness not to exceed $30,000,000 in the aggregate principal amount evidenced by senior unsecured notes issued by Borrower pursuant to the terms and provisions of those certain Note Purchase Agreements, dated as of June 15, 1996, between Borrower and the purchasers named therein, as amended, modified or supplemented from time to time ("Note Purchase Agreements"), and all other Indebtedness outstanding under the Note Purchase Agreements subject to the limitations with respect to the principal amount thereof set forth in this clause (d). 8.10 Sale and Leasebacks. Enter into any arrangement with any Person providing for the leasing by Borrower of any asset which has been sold or transferred by Borrower to such Person if such arrangement occurs more than ninety (90) days after the purchase of such asset by Borrower. 8.16 Indebtedness to Net Worth. Permit the percentage of Funded Debt to Total Capitalization to be greater than 50% at any time. 8.17 Fixed Charge Coverage Ratio. Permit the Fixed Charge Coverage Ratio to be less than 1.25 t 1.0 at any time from the date of the Third Amendment to this Agreement through and including March 31, 1997; 1.5 to 1.0 at any time from April 1, 1997 through and including December 31, 1997; and 1.75 to 1.0 at any time thereafter." 1.4 Subsection (e) of Section 9.1, Event of Default, is amended by deleting in lines 5 and lines 7 and 8 thereof the words "Money Borrowed Indebtedness" and by substituting in lieu thereof the words "Funded Debt". 1.5 Exhibit J to the Agreement is amended by renaming the -5- description of such exhibit as "Funded Debt". ARTICLE II REPRESENTATIONS AND WARRANTIES The Borrower hereby represents and warrants to the Bank that: 2.1 Acknowledgement of Obligations. As of the close of business on June 18, 1996, the aggregate principal amount of Revolving Loans owing by Borrower is in the sum of $23,700,000, the aggregate amount of Letter of Credit Obligations owing by the Borrower is in the sum of $12,150,176, the aggregate principal amount of loans owing under the $5,000,000 Additional Revolving Credit Note, dated May 3, 1996, is in the amount of $5,000,000, the aggregate principal amount of loans owing by the Borrower under the $2,000,000 Second Additional Revolving Credit Note, dated June 17, 1996, is in the amount of $2,000,000, and that all such Obligations are owing by the Borrower to the Bank without any defense, deduction, offset or counterclaim of any nature. 2.2 Compliance with Credit Agreement. As of the execution of this Amendment, the Borrower is in compliance with all of the terms and provisions set forth in the loan documents to be observed or performed by the Borrower, except for the failure by the Borrower to comply has been waived in writing by the Bank. 2.3 Representations in Credit Agreement. The representations and warranties of the Borrower set forth in the Credit Agreement are true and correct in all material respects. 2.4 No Event of Default. No Default or Event of Default exists. 2.5 Use of Proceeds of the Placement. To the extent that the outstanding balance of Revolving Loans exceeds $15,000,000 in the aggregate on the effective date of this Amendment, the Borrower agrees that it shall use the proceeds received from the Placement to pay such Revolving Loans which are outstanding in excess of $15,000,000. -6- ARTICLE III MODIFICATION OF LOAN DOCUMENTS 3.1 Loan Documents. Any individual or collective reference to any of the Loan Documents shall hereafter mean such Loan Document as amended by this Amendment, and as further amended, restated and supplemented or modified from time to time, including, without limitation, all references to the Credit Agreement, which shall mean the Credit Agreement as amended hereby and as further amended from time to time. ARTICLE IV GENERAL 4.1 Full Force and Effect. Except as expressly amended hereby, the Credit Agreement and the other Loan Documents shall continue in full force and effect in accordance with the provisions thereof. As used in the Credit Agreement and the other Loan Documents, "hereinafter", "hereto", "hereof", or words of similar import, shall mean the Credit Agreement or the other Loan Documents, as the case may be, as amended by this Amendment. 4.2 Applicable Law. This Amendment shall be governed by and construed in accordance with the internal laws and judicial decisions of the State of North Carolina. 4.3 Headings. The headings of this Amendment are for the purpose of reference only and shall not effect the construction of this Amendment. 4.4 Waiver of Jury Trial. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE BORROWER AND THE BANK EACH WAIVE THE RIGHT TO A JURY TRIAL IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AMENDMENT, THE CREDIT AGREEMENT OR THE OTHER LOAN DOCUMENTS. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed and delivered under seal by their duly -7- authorized officers to be effective as of the date first above written. ATTEST: OLD DOMINION FREIGHT LINE, INC. JOEL B. MCCARTY, JR. By: J. WES FRYE Secretary Title: CHIEF FINANCIAL OFFICER [CORPORATE SEAL] FIRST UNION NATIONAL BANK OF NORTH CAROLINA By: JERRY HIGHSMITH Title: SENIOR VICE PRESIDENT -8- EX-4 4 EXHIBIT 4.5 Exhibit 4.5 [COMPOSITE CONFORMED COPY] ================================================================================ OLD DOMINION FREIGHT LINE, INC. $10,000,000 7.30% Senior Notes due December 15, 2002 and $20,000,000 7.59% Senior Notes due June 15, 2006 -------------- NOTE PURCHASE AGREEMENT ------------- Dated as of June 15, 1996 ================================================================================ COMPOSITE CONFORMED COPY OF NOTE PURCHASE AGREEMENT Four separate Note Purchase Agreements, each in the form of the following Note Purchase Agreement, were entered into between Old Dominion Freight Line, Inc. and each of the Purchasers named in Schedule A thereto. Each of said separate Note Purchase Agreements was executed on behalf of Old Dominion Freight Line, Inc. as indicated on page 37 and accepted by each of the respective Purchasers as indicated on page 37. TABLE OF CONTENTS (Not a part of the Agreement)
SECTION HEADING PAGE SECTION 1. AUTHORIZATION OF NOTES..................................................................1 SECTION 2. SALE AND PURCHASE OF NOTES..............................................................1 SECTION 3. CLOSING.................................................................................2 SECTION 4. CONDITIONS TO CLOSING...................................................................2 Section 4.1. Representations and Warranties......................................................2 Section 4.2. Performance; No Default.............................................................2 Section 4.3. Compliance Certificates.............................................................3 Section 4.4. Opinions of Counsel.................................................................3 Section 4.5. Purchase Permitted By Applicable Law, etc...........................................3 Section 4.6. Sale of Other Notes.................................................................3 Section 4.7. Payment of Special Counsel Fees.....................................................3 Section 4.8. Private Placement Number............................................................3 Section 4.9. Changes in Corporate Structure......................................................4 Section 4.10. Proceedings and Documents...........................................................4 SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY...........................................4 Section 5.1. Organization; Power and Authority...................................................4 Section 5.2. Authorization, etc..................................................................4 Section 5.3. Disclosure..........................................................................4 Section 5.4. Organization and Ownership of Shares of Subsidiaries; Affiliates....................5 Section 5.5. Financial Statements................................................................5 Section 5.6. Compliance with Laws, Other Instruments, etc........................................6 Section 5.7. Governmental Authorizations, etc....................................................6 Section 5.8. Litigation; Observance of Agreements, Statutes and Orders...........................6 Section 5.9. Taxes...............................................................................6 Section 5.10. Title to Property; Leases...........................................................7 Section 5.11. Licenses, Permits, etc..............................................................7 Section 5.12. Compliance with ERISA...............................................................7 Section 5.13. Private Offering by the Company.....................................................8 Section 5.14. Use of Proceeds; Margin Regulations.................................................8 Section 5.15. Existing Debt; Future Liens.........................................................8 Section 5.16. Foreign Assets Control Regulations, etc.............................................9 Section 5.17. Status under Certain Statutes.......................................................9 Section 5.18. Environmental Matters...............................................................9 i SECTION 6. REPRESENTATIONS OF THE PURCHASER........................................................10 Section 6.1. Purchase for Investment.............................................................10 Section 6.2. Source of Funds.....................................................................10 SECTION 7. INFORMATION AS TO COMPANY...............................................................11 Section 7.1. Financial and Business Information..................................................11 Section 7.2. Officer's Certificate...............................................................14 Section 7.3. Inspection..........................................................................14 SECTION 8. PREPAYMENT OF THE NOTES.................................................................15 Section 8.1. Required Prepayments................................................................15 Section 8.2. Optional Prepayments with Make-Whole Amount.........................................16 Section 8.3. Prepayment of Notes upon Change in Control..........................................16 Section 8.4. Allocation of Partial Prepayments...................................................18 Section 8.5. Maturity; Surrender, etc............................................................18 Section 8.6. Purchase of Notes...................................................................18 Section 8.7. Make-Whole Amount...................................................................18 SECTION 9. AFFIRMATIVE COVENANTS...................................................................20 Section 9.1. Compliance with Law.................................................................20 Section 9.2. Insurance...........................................................................20 Section 9.3. Maintenance of Properties...........................................................20 Section 9.4. Payment of Taxes and Claims.........................................................20 Section 9.5. Corporate Existence, etc............................................................21 SECTION 10. NEGATIVE COVENANTS......................................................................21 Section 10.1. Consolidated Tangible Net Worth.....................................................21 Section 10.2. Fixed Charges Coverage Ratio........................................................21 Section 10.3. Limitations on Debt.................................................................21 Section 10.4. Liens...............................................................................21 Section 10.5. Restricted Payments and Restricted Investments......................................23 Section 10.6. Merger, Consolidation, etc..........................................................24 Section 10.7. Sale of Assets, etc.................................................................25 Section 10.8. Sale-and-Leasebacks.................................................................25 Section 10.9. Transactions with Affiliates........................................................26 Section 10.10. Line of Business....................................................................26 SECTION 11. EVENTS OF DEFAULT.......................................................................26 SECTION 12. REMEDIES ON DEFAULT, ETC................................................................28 Section 12.1. Acceleration........................................................................28 Section 12.2. Other Remedies......................................................................29 ii Section 12.3. Rescission..........................................................................29 Section 12.4. No Waivers or Election of Remedies, Expenses, etc...................................29 SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES...........................................30 Section 13.1. Registration of Notes...............................................................30 Section 13.2. Transfer and Exchange of Notes......................................................30 Section 13.3. Replacement of Notes................................................................30 SECTION 14. PAYMENTS ON NOTES.......................................................................31 Section 14.1. Place of Payment....................................................................31 Section 14.2. Home Office Payment.................................................................31 SECTION 15. EXPENSES, ETC...........................................................................31 Section 15.1. Transaction Expenses................................................................31 Section 15.2. Survival............................................................................32 SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT............................32 SECTION 17. AMENDMENT AND WAIVER....................................................................32 Section 17.1. Requirements........................................................................32 Section 17.2. Solicitation of Holders of Notes....................................................33 Section 17.3. Binding Effect, etc.................................................................33 Section 17.4. Notes Held by Company, etc..........................................................33 SECTION 18. NOTICES.................................................................................33 SECTION 19. REPRODUCTION OF DOCUMENTS...............................................................34 SECTION 20. CONFIDENTIAL INFORMATION................................................................34 SECTION 21. SUBSTITUTION OF PURCHASER...............................................................35 SECTION 22. MISCELLANEOUS...........................................................................36 Section 22.1. Successors and Assigns..............................................................36 Section 22.2. Payments Due on Non-Business Days...................................................36 Section 22.3. Severability........................................................................36 Section 22.4. Construction........................................................................36 Section 22.5. Counterparts........................................................................36 Section 22.6. Governing Law.......................................................................36 Section 22.7. Additional Debt.....................................................................36 iii Signature..........................................................................................................37
ATTACHMENTS TO NOTE PURCHASE AGREEMENT: SCHEDULE A -- Information Relating To Purchasers SCHEDULE B -- Defined Terms SCHEDULE C -- Existing Debt SCHEDULE 5.4 -- Subsidiaries of the Company and Ownership of Subsidiary Stock SCHEDULE 5.5 -- Financial Statements SCHEDULE 5.14 -- ERISA Affiliates and Plans SCHEDULE 5.15 -- Existing Debt SCHEDULE 10.4 -- Existing Liens EXHIBIT 1-A -- Form of 2002 Notes EXHIBIT 1-B -- Form of 2006 Notes EXHIBIT 4.4(a) -- Form of Opinion of Special Counsel for the Company EXHIBIT 4.4(b) -- Form of Opinion of Special Counsel for the Purhasers EXHIBIT 4.5 -- Legality Certificate iv OLD DOMINION FREIGHT LINE, INC. 1730 WESTCHESTER DRIVE HIGH POINT, NORTH CAROLINA 27261 $10,000,000 7.30% Senior Notes due December 15, 2002 and $20,000,000 7.59% Senior Notes due June 15, 2006 Dated as of June 15, 1996 TO EACH OF THE PURCHASERS LISTED IN THE ATTACHED SCHEDULE A: Ladies and Gentlemen: OLD DOMINION FREIGHT LINE, INC., a Virginia corporation (the "COMPANY"), agrees with you as follows: SECTION 1. AUTHORIZATION OF NOTES. The Company will authorize the issue and sale of $10,000,000 aggregate principal amount of its 7.30% Senior Notes due December 15, 2002 and $20,000,000 aggregate principal amount of its 7.59% Senior Notes due June 15, 2006 (respectively, the "2002 NOTES" and the "2006 NOTES", each being a "SERIES" of Notes and collectively the "NOTES", such term to include any such notes issued in substitution therefor pursuant to Section 13 of this Agreement or the Other Agreements (as hereinafter defined)). The Notes shall be substantially in the respective forms set out in Exhibits 1-A and 1-B, with such changes therefrom, if any, as may be approved by you and the Company. Certain capitalized terms used in this Agreement are defined in Schedule B; references to a "Schedule" or an "Exhibit" are, unless otherwise specified, to a Schedule or an Exhibit attached to this Agreement. SECTION 2. SALE AND PURCHASE OF NOTES. Subject to the terms and conditions of this Agreement, the Company will issue and sell to you and you will purchase from the Company, at the Closing provided for in Section 3, Notes in the principal amount and of the Series specified opposite your name in Schedule A at the purchase price of 100% of the principal amount thereof. Contemporaneously with entering into this Agreement, the Company is entering into separate Note Purchase Agreements (the "OTHER AGREEMENTS") identical with this Agreement with the other purchasers named in Schedule A (the "OTHER PURCHASERS"), providing for the sale at such Closing to the Other Purchasers of Notes in the principal amount and of the Series specified opposite its name in Schedule A. Your Old Dominion Freight Line, Inc. Note Purchase Agreement obligation hereunder, and the obligations of the Other Purchasers under the Other Agreements, are several and not joint obligations, and you shall have no obligation under the Other Agreements and no liability to any Person for the performance or nonperformance by the Other Purchasers thereunder. SECTION 3. CLOSING. The sale and purchase of the Notes to be purchased by you and the Other Purchasers shall occur at the offices of Chapman and Cutler, 111 West Monroe Street, Chicago, Illinois 60603, at 10:00 A.M. Chicago time, at a closing (the "CLOSING") on June 20, 1996 or on such other Business Day thereafter on or prior to June 28, 1996 as may be agreed upon by the Company and you and the Other Purchasers. At the Closing the Company will deliver to you the Notes to be purchased by you in the form of a single Note (or such greater number of Notes in denominations of at least $1,000,000 as you may request) dated the date of the Closing and registered in your name (or in the name of your nominee), against delivery by you to the Company or its order of immediately available funds in the amount of the purchase price therefor by wire transfer of immediately available funds for the account of the Company to account number 2073 7811 32196 at First Union National Bank, High Point, North Carolina (ABA #053000219). If at the Closing the Company shall fail to tender such Notes to you as provided above in this Section 3, or any of the conditions specified in Section 4 shall not have been fulfilled to your satisfaction, you shall, at your election, be relieved of all further obligations under this Agreement, without thereby waiving any rights you may have by reason of such failure or such nonfulfillment. SECTION 4. CONDITIONS TO CLOSING. Your obligation to purchase and pay for the Notes to be sold to you at the Closing is subject to the fulfillment to your satisfaction, prior to or at the Closing, of the following conditions: SECTION 4.1. REPRESENTATIONS AND WARRANTIES. The representations and warranties of the Company in this Agreement shall be correct when made and at the time of the Closing. SECTION 4.2. PERFORMANCE; NO DEFAULT. The Company shall have performed and complied with all agreements and conditions contained in this Agreement required to be performed or complied with by it prior to or at the Closing, and after giving effect to the issue and sale of the Notes (and the application of the proceeds thereof as contemplated by Section 5.14), no Default or Event of Default shall have occurred and be continuing. Neither the Company nor any Subsidiary shall have entered into any transaction since the date of the Memorandum that would have been prohibited by Section 10 hereof had such Section applied since such date. 2 Old Dominion Freight Line, Inc. Note Purchase Agreement SECTION 4.3. COMPLIANCE CERTIFICATES. (a) OFFICER'S CERTIFICATE. The Company shall have delivered to you an Officer's Certificate, dated the date of the Closing, certifying that the conditions specified in Sections 4.1, 4.2 and 4.9 have been fulfilled. (b) SECRETARY'S CERTIFICATE. The Company shall have delivered to you a certificate certifying as to the resolutions attached thereto and other corporate proceedings relating to the authorization, execution and delivery of the Notes and the Agreements. SECTION 4.4. OPINIONS OF COUNSEL. You shall have received opinions in form and substance satisfactory to you, dated the date of the Closing (a) from Womble Carlyle Sandridge & Rice, PLLC, special counsel for the Company, covering the matters set forth in Exhibit 4.4(a) and covering such other matters incident to the transactions contemplated hereby as you or your counsel may reasonably request (and the Company hereby instructs its counsel to deliver such opinion to you) and (b) from Chapman and Cutler, your special counsel in connection with such transactions, substantially in the form set forth in Exhibit 4.4(b) and covering such other matters incident to such transactions as you may reasonably request. SECTION 4.5. PURCHASE PERMITTED BY APPLICABLE LAW, ETC. On the date of the Closing your purchase of Notes shall (i) be permitted by the laws and regulations of each jurisdiction to which you are subject, without recourse to provisions (such as Section 1405(a)(8) of the New York Insurance Law) permitting limited investments by insurance companies without restriction as to the character of the particular investment, (ii) not violate any applicable law or regulation (including, without limitation, Regulation G, T or X of the Board of Governors of the Federal Reserve System) and (iii) not subject you to any tax, penalty or liability under or pursuant to any applicable law or regulation, which law or regulation was not in effect on the date hereof. If requested by you, you shall have received an Officer's Certificate (or legality certificate in the form of Exhibit 4.5 hereto) certifying as to such matters of fact as you may reasonably specify to enable you to determine whether such purchase is so permitted. SECTION 4.6. SALE OF OTHER NOTES. Contemporaneously with the Closing, the Company shall sell to the Other Purchasers, and the Other Purchasers shall purchase, the Notes to be purchased by it at the Closing as specified in Schedule A. SECTION 4.7. PAYMENT OF SPECIAL COUNSEL FEES. Without limiting the provisions of Section 15.1, the Company shall have paid on or before the Closing the fees, charges and disbursements of your special counsel referred to in Section 4.4 to the extent reflected in a statement of such counsel rendered to the Company at least one Business Day prior to the Closing. SECTION 4.8. PRIVATE PLACEMENT NUMBER. A Private Placement Number issued by Standard & Poor's CUSIP Service Bureau (in cooperation with the Securities Valuation Office of 3 Old Dominion Freight Line, Inc. Note Purchase Agreement the National Association of Insurance Commissioners) shall have been obtained for each Series of the Notes. SECTION 4.9. CHANGES IN CORPORATE STRUCTURE. The Company shall not have changed its jurisdiction of incorporation or been a party to any merger or consolidation and shall not have succeeded to all or any substantial part of the liabilities of any other entity, at any time following the date of the most recent financial statements referred to in Schedule 5.5. SECTION 4.10. PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings in connection with the transactions contemplated by this Agreement and all documents and instruments incident to such transactions shall be satisfactory to you and your special counsel, and you and your special counsel shall have received all such counterpart originals or certified or other copies of such documents as you or they may reasonably request. SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents and warrants to you that: SECTION 5.1. ORGANIZATION; POWER AND AUTHORITY. The Company is a corporation duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation, and is duly qualified as a foreign corporation and is in good standing in each jurisdiction in which such qualification is required by law, other than those jurisdictions as to which the failure to be so qualified or in good standing could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Company has the corporate power and authority to own or hold under lease the properties it purports to own or hold under lease, to transact the business it transacts and proposes to transact, to execute and deliver this Agreement and the Other Agreements and the Notes and to perform the provisions hereof and thereof. SECTION 5.2. AUTHORIZATION, ETC. This Agreement, the Other Agreements and the Notes have been duly authorized by all necessary corporate action on the part of the Company, and this Agreement constitutes, and upon execution and delivery thereof each Note will constitute, a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as such enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law). SECTION 5.3. DISCLOSURE. The Company, through its agent, First Union Capital Markets Corp., has delivered to you and the Other Purchasers a copy of a Confidential Private Placement Memorandum, dated April 19, 1996 (the "MEMORANDUM"), relating to the transactions contemplated hereby. The Memorandum fairly describes, in all material respects, the general nature of the business and principal properties of the Company and its Subsidiaries. This Agreement, the Memorandum, the documents, certificates or other writings delivered to you by or on behalf of the Company in connection with the transactions contemplated hereby and the 4 Old Dominion Freight Line, Inc. Note Purchase Agreement financial statements listed in Schedule 5.5, taken as a whole, do not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein not misleading in light of the circumstances under which they were made. Since December 31, 1995, there has been no change in the financial condition, operations, business, properties or prospects of the Company or any Subsidiary except changes that individually or in the aggregate could not reasonably be expected to have a Material Adverse Effect. There is no fact known to the Company that could reasonably be expected to have a Material Adverse Effect. SECTION 5.4. ORGANIZATION AND OWNERSHIP OF SHARES OF SUBSIDIARIES; AFFILIATES. (a) Schedule 5.4 contains (except as noted therein) complete and correct lists (i) of the Company's Subsidiaries, showing, as to each Subsidiary, the correct name thereof, the jurisdiction of its organization, and the percentage of shares of each class of its capital stock or similar equity interests outstanding owned by the Company and each other Subsidiary, (ii) of the Company's Affiliates, other than Subsidiaries, and (iii) of the Company's directors and senior officers. (b) All of the outstanding shares of capital stock or similar equity interests of each Subsidiary shown in Schedule 5.4 as being owned by the Company and its Subsidiaries have been validly issued, are fully paid and nonassessable and are owned by the Company or another Subsidiary free and clear of any Lien. (c) Each Subsidiary identified in Schedule 5.4 is a corporation or other legal entity duly organized, validly existing and in good standing under the laws of its jurisdiction of organization, and is duly qualified as a foreign corporation or other legal entity and is in good standing in each jurisdiction in which such qualification is required by law, other than those jurisdictions as to which the failure to be so qualified or in good standing could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Each such Subsidiary has the corporate or other power and authority to own or hold under lease the properties it purports to own or hold under lease and to transact the business it transacts and proposes to transact. (d) No Subsidiary is a party to, or otherwise subject to any legal restriction or any agreement (other than this Agreement and restrictions imposed by the corporate law of the jurisdiction under which such Subsidiary exists) restricting the ability of such Subsidiary to pay dividends out of profits or make any other similar distributions of profits to the Company or any of its Subsidiaries that owns outstanding shares of capital stock or similar equity interests of such Subsidiary. SECTION 5.5. FINANCIAL STATEMENTS. The Company has delivered to each Purchaser copies of the financial statements of the Company and its Subsidiaries listed on Schedule 5.5. All of said financial statements (including in each case the related schedules and notes) fairly present in all material respects the consolidated financial position of the Company and its Subsidiaries as of the respective dates specified in such Schedule and the consolidated results of their operations and cash flows for the respective periods so specified and have been prepared in accordance with 5 Old Dominion Freight Line, Inc. Note Purchase Agreement GAAP consistently applied throughout the periods involved except as set forth in the notes thereto (subject, in the case of any interim financial statements, to normal year-end adjustments). SECTION 5.6. COMPLIANCE WITH LAWS, OTHER INSTRUMENTS, ETC. The execution, delivery and performance by the Company of this Agreement and the Notes will not (i) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of any property of the Company or any Subsidiary under, any indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate charter or by-laws, or any other agreement or instrument to which the Company or any Subsidiary is bound or by which the Company or any Subsidiary or any of their respective properties may be bound or affected, (ii) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree, or ruling of any court, arbitrator or Governmental Authority applicable to the Company or any Subsidiary or (iii) violate any provision of any statute or other rule or regulation of any Governmental Authority applicable to the Company or any Subsidiary. SECTION 5.7. GOVERNMENTAL AUTHORIZATIONS, ETC. No consent, approval or authorization of, or registration, filing or declaration with, any Governmental Authority or pursuant to the Interstate Commerce Act, as amended, is required in connection with the execution, delivery or performance by the Company of this Agreement or the Notes. SECTION 5.8. LITIGATION; OBSERVANCE OF AGREEMENTS, STATUTES AND ORDERS. (a) There are no actions, suits or proceedings pending or, to the knowledge of the Company, threatened against or affecting the Company or any Subsidiary or any property of the Company or any Subsidiary in any court or before any arbitrator of any kind or before or by any Governmental Authority that, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect. (b) Neither the Company nor any Subsidiary is in default under any term of any agreement or instrument to which it is a party or by which it is bound, or any order, judgment, decree or ruling of any court, arbitrator or Governmental Authority or is in violation of any applicable law, ordinance, rule or regulation (including without limitation Environmental Laws) of any Governmental Authority, which default or violation, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect. SECTION 5.9. TAXES. The Company and its Subsidiaries have filed all tax returns that are required to have been filed in any jurisdiction, and have paid all taxes shown to be due and payable on such returns and all other taxes and assessments levied upon them or their properties, assets, income or franchises, to the extent such taxes and assessments have become due and payable and before they have become delinquent, except for any taxes and assessments (i) the amount of which is not individually or in the aggregate Material or (ii) the amount, applicability or validity of which is currently being contested in good faith by appropriate proceedings and with respect to which the Company or a Subsidiary, as the case may be, has established adequate reserves in accordance with GAAP. The Company knows of no basis for any other tax or assessment that could reasonably be expected to have a Material Adverse Effect. The charges, accruals and reserves on the books of the Company and its Subsidiaries in respect of Federal, 6 Old Dominion Freight Line, Inc. Note Purchase Agreement state or other taxes for all fiscal periods are adequate. The Federal income tax liabilities of the Company and its Subsidiaries have been determined by the Internal Revenue Service and paid for all fiscal years up to and including the fiscal year ended December 31, 1991. SECTION 5.10. TITLE TO PROPERTY; LEASES. The Company and its Subsidiaries have good and sufficient title to their respective properties that individually or in the aggregate are Material, including all such properties reflected in the most recent audited balance sheet referred to in Section 5.5 or purported to have been acquired by the Company or any Subsidiary after said date (except as sold or otherwise disposed of in the ordinary course of business), in each case free and clear of Liens prohibited by this Agreement. All leases that individually or in the aggregate are Material are valid and subsisting and are in full force and effect in all material respects. SECTION 5.11. LICENSES, PERMITS, ETC. (a) The Company and its Subsidiaries own or possess all licenses, permits, franchises, authorizations, patents, copyrights, service marks, trademarks and trade names, or rights thereto, that individually or in the aggregate are Material, without known conflict with the rights of others. (b) To the best knowledge of the Company, no product of the Company infringes in any Material respect any license, permit, franchise, authorization, patent, copyright, service mark, trademark, trade name or other right owned by any other Person. (c) To the best knowledge of the Company, there is no Material violation by any Person of any right of the Company or any of its Subsidiaries with respect to any patent, copyright, service mark, trademark, trade name or other right owned or used by the Company or any of its Subsidiaries. SECTION 5.12. COMPLIANCE WITH ERISA. (a) The Company and each ERISA Affiliate have operated and administered each Plan in compliance with all applicable laws except for such instances of noncompliance as have not resulted in and could not reasonably be expected to result in a Material Adverse Effect. Neither the Company nor any ERISA Affiliate has incurred any liability pursuant to Title I of ERISA or the penalty or excise tax provisions of the Code relating to employee benefit plans (as defined in Section 3 of ERISA), and no event, transaction or condition has occurred or exists that could reasonably be expected to result in the incurrence of any such liability by the Company or any ERISA Affiliate, or in the imposition of any Lien on any of the rights, properties or assets of the Company or any ERISA Affiliate, in either case pursuant to Title I of ERISA or to such penalty or excise tax provisions of the Code, other than such liabilities or Liens as would not be individually or in the aggregate Material. (b) Neither the Company nor any ERISA Affiliate participates in, contributes to or has any liability with respect to any pension plan subject to Title IV of ERISA. 7 Old Dominion Freight Line, Inc. Note Purchase Agreement (c) The expected post-retirement benefit obligation (determined as of the last day of the Company's most recently ended fiscal year in accordance with Financial Accounting Standards Board Statement No. 106, without regard to liabilities attributable to continuation coverage mandated by section 4980B of the Code) of the Company and its Subsidiaries is not Material. (d) The execution and delivery of this Agreement and the issuance and sale of the Notes hereunder will not involve any transaction that is subject to the prohibitions of section 406 of ERISA or in connection with which a tax could be imposed pursuant to section 4975(c)(1)(A)-(D) of the Code. The representation by the Company in the first sentence of this Section 5.12(d) is made in reliance upon and subject to (i) the accuracy of your representation in Section 6.2 as to the sources of the funds used to pay the purchase price of the Notes to be purchased by you and (ii) the assumption, made solely for the purpose of making such representation, that Department of Labor Interpretive Bulletin 75-2 with respect to prohibited transactions remains valid in the circumstances of the transactions contemplated herein. (e) Schedule 5.14 contains a complete and correct list of all ERISA Affiliates and all Plans established or maintained by the Company and its ERISA Affiliates. SECTION 5.13. PRIVATE OFFERING BY THE COMPANY. Neither the Company nor anyone acting on its behalf has offered the Notes or any similar securities for sale to, or solicited any offer to buy any of the same from, or otherwise approached or negotiated in respect thereof with, any person other than you, the Other Purchasers and not more than eighty (80) other Institutional Investors, each of which has been offered the Notes at a private sale for investment. Neither the Company nor anyone acting on its behalf has taken, or will take, any action that would subject the issuance or sale of the Notes to the registration requirements of Section 5 of the Securities Act. SECTION 5.14. USE OF PROCEEDS; MARGIN REGULATIONS. The Company will use the proceeds of the sale of the Notes to prepay certain existing Funded Debt, to fund capital expenditures and for general corporate purposes. No part of the proceeds from the sale of the Notes hereunder will be used, directly or indirectly, for the purpose of buying or carrying any margin stock within the meaning of Regulation G of the Board of Governors of the Federal Reserve System (12 CFR 207), or for the purpose of buying or carrying or trading in any securities under such circumstances as to involve the Company in a violation of Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a violation of Regulation T of said Board (12 CFR 220). The Company does not presently own any margin stock and does not have any present intention to acquire any margin stock in the future. As used in this Section, the terms "margin stock" and "purpose of buying or carrying" shall have the meanings assigned to them in said Regulation G. SECTION 5.15. EXISTING DEBT; FUTURE LIENS. (a) Schedule 5.15 sets forth a complete and correct list of all outstanding Debt of the Company and its Subsidiaries as of the date of this Agreement, since which date there has been no Material change in the amounts, interest rates, sinking funds, installment payments or maturities of the Debt of the Company or its Subsidiaries. 8 Old Dominion Freight Line, Inc. Note Purchase Agreement Neither the Company nor any Subsidiary is in default and no waiver of default is currently in effect, in the payment of any principal or interest on any Debt of the Company or such Subsidiary and no event or condition exists with respect to any Debt of the Company or any Subsidiary that would permit (or that with notice or the lapse of time, or both, would permit) one or more Persons to cause such Debt to become due and payable before its stated maturity or before its regularly scheduled dates of payment. (b) Neither the Company nor any Subsidiary has agreed or consented to cause or permit in the future (upon the happening of a contingency or otherwise) any of its property, whether now owned or hereafter acquired, to be subject to a Lien not permitted by Section 10.4. SECTION 5.16. FOREIGN ASSETS CONTROL REGULATIONS, ETC. Neither the sale of the Notes by the Company hereunder nor its use of the proceeds thereof will violate the Trading with the Enemy Act, as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling legislation or executive order relating thereto. SECTION 5.17. STATUS UNDER CERTAIN STATUTES. Neither the Company nor any subsidiary is subject to regulation under the Investment Company Act of 1940, as amended, the Public Utility Holding Company Act of 1935, as amended, or the Federal Power Act, as amended. SECTION 5.18. ENVIRONMENTAL MATTERS. Neither the Company nor any Subsidiary has knowledge of any claim or has received any notice of any claim, and no proceeding has been instituted raising any claim against the Company or any of its Subsidiaries or any of their respective real properties now or formerly owned, leased or operated by any of them or other assets, alleging any damage to the environment or violation of any Environmental Laws, except, in each case, such as could not reasonably be expected to result in a Material Adverse Effect. Except as otherwise disclosed to you in writing: (a) neither the Company nor any Subsidiary has knowledge of any facts which would give rise to any claim, public or private, of violation of Environmental Laws or damage to the environment emanating from, occurring on or in any way related to real properties now or formerly owned, leased or operated by any of them or to other assets or their use, except, in each case, such as could not reasonably be expected to result in a Material Adverse Effect; (b) neither the Company nor any of its Subsidiaries has stored any Hazardous Materials on real properties now or formerly owned, leased or operated by any of them and or has disposed of any Hazardous Materials in a manner contrary to any Environmental Laws in each case in any manner that could reasonably be expected to result in a Material Adverse Effect; and (c) all buildings on all real properties now owned, leased or operated by the Company or any of its Subsidiaries are in compliance with applicable Environmental 9 Old Dominion Freight Line, Inc. Note Purchase Agreement Laws, except where failure to comply could not reasonably be expected to result in a Material Adverse Effect. SECTION 6. REPRESENTATIONS OF THE PURCHASER. SECTION 6.1. PURCHASE FOR INVESTMENT. You represent that you are purchasing the Notes for your own account or for one or more separate accounts maintained by you or for the account of one or more pension or trust funds and not with a view to the distribution thereof, PROVIDED that the disposition of your or their property shall at all times be within your or their control. You understand that the Notes have not been registered under the Securities Act and may be resold only if registered pursuant to the provisions of the Securities Act or if an exemption from registration is available, except under circumstances where neither such registration nor such an exemption is required by law, and that the Company is not required to register the Notes. SECTION 6.2. SOURCE OF FUNDS. You represent that at least one of the following statements is an accurate representation as to each source of funds (a "SOURCE") to be used by you to pay the purchase price of the Notes to be purchased by you hereunder: (a) the Source is an "insurance company general account" within the meaning of Department of Labor Prohibited Transaction Exemption ("PTE") 95-60 (issued July 12, 1995), and there is no employee benefit plan (treating as a single plan all plans maintained by the same employer or employee organization) with respect to which the amount of the general account reserves and liabilities for all contracts held by or on behalf of such plan exceed 10% of the total reserves and liabilities of such general account (exclusive of separate account liabilities) plus surplus, as set forth in your most recent annual statement in the form required by the National Association of Insurance Commissioners as filed with your state of domicile; or (b) the Source is either (i) an insurance company pooled separate account, within the meaning of Prohibited Transaction Exemption 90-1 (issued January 29, 1990), or (ii) a bank collective investment fund, within the meaning of the PTE 91-38 (issued July 12, 1991) and, except as you have disclosed to the Company in writing pursuant to this paragraph (b), no employee benefit plan or group of plans maintained by the same employer or employee organization beneficially owns more than 10% of all assets allocated to such pooled separate account or collective investment fund; or (c) the Source constitutes assets of an "investment fund" (within the meaning of Part V of the QPAM Exemption) managed by a "qualified professional asset manager" or "QPAM" (within the meaning of Part V of the QPAM Exemption), no employee benefit plan's assets that are included in such investment fund, when combined with the assets of all other employee benefit plans established or maintained by the same employer or by an affiliate (within the meaning of Section V(c)(1) of the QPAM Exemption) of such employer or by the same employee organization and managed by such QPAM, exceed 20% of the total client assets managed by such QPAM, the conditions of Part l(c) 10 Old Dominion Freight Line, Inc. Note Purchase Agreement and (g) of the QPAM Exemption are satisfied, neither the QPAM nor a person controlling or controlled by the QPAM (applying the definition of "control" in Section V(e) of the QPAM Exemption) owns a 5% or more interest in the Company and (i) the identity of such QPAM and (ii) the names of all employee benefit plans whose assets are included in such investment fund have been disclosed to the Company in writing pursuant to this paragraph (c); or (d) the Source is a governmental plan; or (e) the Source is one or more employee benefit plans, or a separate account or trust fund comprised of one or more employee benefit plans, each of which has been identified to the Company in writing pursuant to this paragraph (e); or (f) the Source does not include assets of any employee benefit plan, other than a plan exempt from the coverage of ERISA. As used in this Section 6.2, the terms "EMPLOYEE BENEFIT PLAN", "GOVERNMENTAL PLAN", "PARTY IN INTEREST" and "SEPARATE ACCOUNT" shall have the respective meanings assigned to such terms in Section 3 of ERISA. SECTION 7. INFORMATION AS TO COMPANY. SECTION 7.1. FINANCIAL AND BUSINESS INFORMATION. The Company shall deliver to each holder of Notes that is an Institutional Investor: (a) QUARTERLY STATEMENTS -- within 60 days after the end of each quarterly fiscal period in each fiscal year of the Company (other than the last quarterly fiscal period of each such fiscal year), duplicate copies of: (i) a consolidated balance sheet of the Company and its Subsidiaries as at the end of such quarter, and (ii) consolidated statements of income, changes in shareholders' equity and cash flows of the Company and its Subsidiaries for such quarter and (in the case of the second and third quarters) for the portion of the fiscal year ending with such quarter, setting forth in each case in comparative form the figures for the corresponding periods in the previous fiscal year, all in reasonable detail, prepared in accordance with GAAP applicable to quarterly financial statements generally, and certified by a Senior Financial Officer as fairly presenting, in all material respects, the financial position of the companies being reported on and their results of operations and cash flows, subject to changes resulting from year-end adjustments, PROVIDED that delivery within the time period specified above of copies of the Company's Quarterly Report on Form 10-Q prepared in compliance with the requirements therefor and filed with the Securities and Exchange Commission shall be deemed to satisfy the requirements of this Section 7.1 (a); 11 Old Dominion Freight Line, Inc. Note Purchase Agreement (b) ANNUAL STATEMENTS -- within 120 days after the end of each fiscal year of the Company, duplicate copies of, (i) a consolidated balance sheet of the Company and its Subsidiaries, as at the end of such year, and (ii) consolidated statements of income, changes in shareholders' equity and cash flows of the Company and its Subsidiaries, for such year, setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail, prepared in accordance with GAAP, and accompanied (A) by an opinion thereon of independent certified public accountants of recognized national standing, which opinion shall state that such financial statements present fairly, in all material respects, the financial position of the companies being reported upon and their results of operations and cash flows and have been prepared in conformity with GAAP, and that the examination of such accountants in connection with such financial statements has been made in accordance with generally accepted auditing standards, and that such audit provides a reasonable basis for such opinion in the circumstances, and (B) a certificate of such accountants stating that they have reviewed this Agreement and stating further whether, in making their audit, they have become aware of any condition or event that then constitutes a Default or an Event of Default, and, if they are aware that any such condition or event then exists, specifying the nature and period of the existence thereof (it being understood that such accountants shall not be liable, directly or indirectly, for any failure to obtain knowledge of any Default or Event of Default unless such accountants should have obtained knowledge thereof in making an audit in accordance with generally accepted auditing standards or did not make such an audit), PROVIDED that the delivery within the time period specified above of the Company's Annual Report on Form 10-K for such fiscal year (together with the Company's annual report to shareholders, if any, prepared pursuant to Rule 14a-3 under the Exchange Act) prepared in accordance with the requirements therefor and filed with the Securities and Exchange Commission, together with the accountant's certificate described in clause (B) above, shall be deemed to satisfy the requirements of this Section 7.1(b); (c) SEC AND OTHER REPORTS -- promptly upon their becoming available, one copy of (i) each financial statement, report, notice or proxy statement sent by the Company or any Subsidiary to public securities holders generally, and (ii) each regular or periodic report, each registration statement (without exhibits except as expressly requested by such holder), and each prospectus and all amendments thereto filed by the 12 Old Dominion Freight Line, Inc. Note Purchase Agreement Company or any Subsidiary with the Securities and Exchange Commission and of all press releases and other statements made available generally by the Company or any Subsidiary to the public concerning developments that are Material; (d) NOTICE OF DEFAULT OR EVENT OF DEFAULT -- promptly, and in any event within five days after a Responsible Officer becoming aware of the existence of any Default or Event of Default or that any Person has given any notice or taken any action with respect to a claimed default hereunder or that any Person has given any notice or taken any action with respect to a claimed default of the type referred to in Section 11(f), a written notice specifying the nature and period of existence thereof and what action the Company is taking or proposes to take with respect thereto; (e) ERISA MATTERS -- promptly, and in any event within five days after a Responsible Officer becoming aware of any of the following, a written notice setting forth the nature thereof and the action, if any, that the Company or an ERISA Affiliate proposes to take with respect thereto: (i) with respect to any Plan, any reportable event, as defined in section 4043(b) of ERISA and the regulations thereunder, for which notice thereof has not been waived pursuant to such regulations as in effect on the date hereof; or (ii) the taking by the PBGC of steps to institute, or the threatening by the PBGC of the institution of, proceedings under section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan, or the receipt by the Company or any ERISA Affiliate of a notice from a Multiemployer Plan that such action has been taken by the PBGC with respect to such Multiemployer Plan; or (iii) any event, transaction or condition that could result in the incurrence of any liability by the Company or any ERISA Affiliate pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of the Code relating to employee benefit plans, or in the imposition of any Lien on any of the rights, properties or assets of the Company or any ERISA Affiliate pursuant to Title I or IV of ERISA or such penalty or excise tax provisions, if such liability or Lien, taken together with any other such liabilities or Liens then existing, could reasonably be expected to have a Material Adverse Effect; (f) NOTICES FROM GOVERNMENTAL AUTHORITY -- promptly, and in any event within 30 days of receipt thereof, copies of any notice to the Company or any Subsidiary from any Federal or state Governmental Authority relating to any order, ruling, statute or other law or regulation that could reasonably be expected to have a Material Adverse Effect; and (g) REQUESTED INFORMATION -- with reasonable promptness, such other data and information relating to the business, operations, affairs, financial condition, assets or 13 Old Dominion Freight Line, Inc. Note Purchase Agreement properties of the Company or any of its Subsidiaries or relating to the ability of the Company to perform its obligations hereunder and under the Notes as from time to time may be reasonably requested by any such holder of Notes. SECTION 7.2. OFFICER'S CERTIFICATE. Each set of financial statements delivered to a holder of Notes pursuant to Section 7.1(a) or Section 7.1(b) hereof shall be accompanied by a certificate of a Senior Financial Officer setting forth: (a) COVENANT COMPLIANCE -- the information (including detailed calculations) required in order to establish whether the Company was in compliance with the requirements of Section 10.1 through Section 10.8 hereof, inclusive, during the quarterly or annual period covered by the statements then being furnished (including with respect to each such Section, where applicable, the calculations of the maximum or minimum amount, ratio or percentage, as the case may be, permissible under the terms of such Sections, and the calculation of the amount, ratio or percentage then in existence); and (b) EVENT OF DEFAULT -- a statement that such officer has reviewed the relevant terms hereof and has made, or caused to be made, under his or her supervision, a review of the transactions and conditions of the Company and its Subsidiaries from the beginning of the quarterly or annual period covered by the statements then being furnished to the date of the certificate and that such review shall not have disclosed the existence during such period of any condition or event that constitutes a Default or an Event of Default or, if any such condition or event existed or exists (including, without limitation, any such event or condition resulting from the failure of the Company or any Subsidiary to comply with any Environmental Law), specifying the nature and period of existence thereof and what action the Company shall have taken or proposes to take with respect thereto. SECTION 7.3. INSPECTION. The Company shall permit the representatives of each holder of Notes that is an Institutional Investor: (a) NO DEFAULT -- if no Default or Event of Default then exists, at the expense of such holder (and if a Default or Event of Default exists, at the expense of the Company) and upon reasonable prior notice to the Company, to visit the principal executive office of the Company, to discuss the affairs, finances and accounts of the Company and its Subsidiaries with the Company's officers, and (with the consent of the Company, which consent will not be unreasonably withheld) its independent public accountants, and (with the consent of the Company, which consent will not be unreasonably withheld) to visit the other offices and properties of the Company and each Subsidiary, all at such reasonable times and as often as may be reasonably requested in writing; and (b) DEFAULT -- if a Default or Event of Default then exists, at the expense of the Company to visit and inspect any of the offices or properties of the Company or any Subsidiary, to examine all their respective books of account, records, reports and other 14 Old Dominion Freight Line, Inc. Note Purchase Agreement papers, to make copies and extracts therefrom, and to discuss their respective affairs, finances and accounts with their respective officers and independent public accountants (and by this provision the Company authorizes said accountants to discuss the affairs, finances and accounts of the Company and its Subsidiaries), all at such times and as often as may be requested. SECTION 8. PREPAYMENT OF THE NOTES. SECTION 8.1. REQUIRED PREPAYMENTS. (a) 2002 NOTES. On each date listed below, the Company will prepay the principal amount listed below opposite such date (or such lesser principal amount as shall then be outstanding) of the 2002 Notes at par and without payment of the Make-Whole Amount or any premium: DATE PREPAYMENT AMOUNT December 15, 1998 $1,000,000 December 15, 1999 $1,500,000 December 15, 2000 $2,000,000 December 15, 2001 $2,500,000 PROVIDED that (i) upon any partial prepayment of the 2002 Notes pursuant to Section 8.2, such partial prepayment shall be deemed to be applied first, to the amount of principal scheduled to remain unpaid on the 2002 Notes on December 15, 2002, and then to the remaining scheduled principal payments in inverse chronological order and (ii) upon any partial prepayment of the 2002 Notes pursuant to Section 8.3 or purchase of the 2002 Notes permitted by Section 8.6, the principal amount of each required prepayment of the 2002 Notes becoming due under this Section 8.1 on and after the date of such prepayment or purchase shall be reduced in the same proportion as the aggregate unpaid principal amount of the 2002 Notes is reduced as a result of such prepayment or purchase. (b) 2006 NOTES. On June 15, 2000 and on each June 15 thereafter, to and including June 15, 2005, the Company will prepay $2,857,143 principal amount (or such lesser principal amount as shall then be outstanding) of the 2006 Notes at par and without payment of the Make-Whole Amount or any premium, provided that (i) upon any partial prepayment of the 2006 Notes pursuant to Section 8.2, such partial prepayment shall be deemed to be applied first, to the amount of principal scheduled to remain unpaid on the 2006 Notes on June 15, 2006, and then to the remaining scheduled principal payments in inverse chronological order and (ii) upon any partial prepayment of the 2006 Notes pursuant to Section 8.3 or purchase of the 2006 Notes permitted by Section 8.6, the principal amount of each required prepayment of the 2006 Notes becoming due under this Section 8.1 on and after the date of such prepayment or purchase shall be reduced in the same proportion as the aggregate unpaid principal amount of the 2006 Notes is reduced as a result of such prepayment or purchase. 15 Old Dominion Freight Line, Inc. Note Purchase Agreement SECTION 8.2. OPTIONAL PREPAYMENTS WITH MAKE-WHOLE AMOUNT. The Company may, at its option, upon notice as provided below, prepay at any time all, or from time to time any part of, the Notes, in an amount not less than 10% of the aggregate principal amount of the Notes then outstanding in the case of a partial prepayment, at 100% of the principal amount so prepaid, plus the Make-Whole Amount determined for the prepayment date with respect to such principal amount so prepaid. The Company will give each holder of Notes written notice of each optional prepayment under this Section 8.2 not less than 30 days and not more than 60 days prior to the date fixed for such prepayment. Each such notice shall specify such date, the aggregate principal amount of the Notes to be prepaid on such date, the principal amount of each Note held by such holder to be prepaid (determined in accordance with Section 8.4), and the interest to be paid on the prepayment date with respect to such principal amount being prepaid, and shall be accompanied by a certificate of a Senior Financial Officer as to the estimated Make-Whole Amount due in connection with such prepayment (calculated as if the date of such notice were the date of the prepayment), setting forth the details of such computation. Two Business Days prior to such prepayment, the Company shall deliver to each holder of Notes a certificate of a Senior Financial Officer specifying the calculation of such Make-Whole Amount as of the specified prepayment date. SECTION 8.3. PREPAYMENT OF NOTES UPON CHANGE IN CONTROL. (a) NOTICE OF CHANGE IN CONTROL OR CONTROL EVENT. The Company will, within five Business Days after any Responsible Officer has knowledge of the occurrence of any Change in Control or Control Event, give written notice of such Change in Control or Control Event to each holder of Notes. In the case that a Change in Control has occurred, such notice shall contain and constitute an offer to prepay Notes as described in subparagraph (b) of this Section 8.3 and shall be accompanied by the certificate described in subparagraph (e) of this Section 8.3. (b) OFFER TO PREPAY NOTES. The offer to prepay Notes contemplated by subparagraph (a) of this Section 8.3 shall be an offer to prepay, in accordance with and subject to this Section 8.3, all, but not less than all, of the Notes held by each holder (in this case only, "HOLDER" in respect of any Note registered in the name of a nominee for a disclosed beneficial owner shall mean such beneficial owner) on a date specified in such offer (the "PROPOSED PREPAYMENT DATE") that is not less than 45 days and not more than 60 days after the date of such offer (if the Proposed Prepayment Date shall not be specified in such offer, the Proposed Prepayment Date shall be the 45th day after the date of such offer). (c) ACCEPTANCE. A holder of Notes may accept the offer to prepay made pursuant to this Section 8.3 by causing a notice of such acceptance to be delivered to the Company at least 20 days prior to the Proposed Prepayment Date. If the Company shall not have received a written response to the offer to prepay pursuant to this Section 8.3 from each holder of Notes within ten Business Days after the date of making such offer to such holder of Notes, then the Company shall immediately send a second written notice with offer to prepay via an overnight air courier of national reputation to each such holder of Notes who shall have not previously responded to the Company. If the offer is so accepted by any holder of Notes, the Company at least 15 days prior to the Proposed Prepayment Date shall give written notice to each holder of 16 Old Dominion Freight Line, Inc. Note Purchase Agreement Notes that has not so accepted the offer, in which notice the Company shall (i) state the aggregate outstanding principal amount of Notes in respect of which the offer has been accepted and (ii) renew the offer and extend the time for acceptance by stating that any holder of Notes may yet accept the offer, whether theretofore rejected or not, by causing a notice of such acceptance to be delivered to the Company at least five days prior to the Proposed Prepayment Date. A failure by a holder of Notes to respond to an offer to prepay made pursuant to this Section 8.3 shall be deemed to constitute an acceptance of such offer by such holder. (d) PREPAYMENT. Prepayment of the Notes to be prepaid pursuant to this Section 8.3 shall be at 100% of the principal amount of such Notes, plus the Make-Whole Amount determined for the date of prepayment with respect to such principal amount, together with interest on such Notes accrued to the date of prepayment. Two Business Days prior to the date of prepayment, the Company shall deliver to each holder of Notes being prepaid a certificate of a Senior Financial Officer showing the Make-Whole Amount due in connection with such prepayment and setting forth the details of the computation of such amount. The prepayment shall be made on the Proposed Prepayment Date. (e) OFFICER'S CERTIFICATE. Each offer to prepay the Notes pursuant to this Section 8.3 shall be accompanied by a certificate, executed by a Senior Financial Officer of the Company and dated the date of such offer, specifying: (i) the Proposed Prepayment Date; (ii) that such offer is made pursuant to this Section 8.3; (iii) the principal amount of each Note offered to be prepaid; (iv) the estimated Make-Whole Amount, if any, due in connection with such prepayment (calculated as if the date of such notice were the date of the prepayment), setting forth the details of such computation; (v) the interest that would be due on each Note offered to be prepaid, accrued to the Proposed Prepayment Date; (vi) that the conditions of this Section 8.3 have been fulfilled; and (vii) in reasonable detail, the nature and date of the Change in Control. (f) "CHANGE IN CONTROL" AND "CURRENT MANAGEMENT" DEFINED. "CHANGE IN CONTROL" shall mean any event or circumstance resulting in any Person or group of Persons acting in concert, other than a group of Persons including, and under the general direction of, Current Management, legally or beneficially owning or controlling, directly or indirectly, more than 50% (by number of votes) of the voting stock of the Company. "CURRENT MANAGEMENT" shall mean and include Earl E. Congdon, John R. Congdon, David S. Congdon and John A. Ebeling. (g) "CONTROL EVENT" DEFINED. "CONTROL EVENT" means: (i) the execution by the Company or any of its Subsidiaries or Affiliates of any agreement or letter of intent with respect to any proposed transaction or event or series of transactions or events which, individually or in the aggregate, may reasonably be expected to result in a Change in Control, or (ii) the execution of any written agreement which, when fully performed by the parties thereto, would result in a Change in Control. 17 Old Dominion Freight Line, Inc. Note Purchase Agreement SECTION 8.4. ALLOCATION OF PARTIAL PREPAYMENTS. In the case of each partial prepayment of the Notes made pursuant to Section 8.1 or Section 8.2, the principal amount of the Notes to be prepaid shall be allocated among all of the Notes of all Series at the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts thereof not theretofore called for prepayment. All partial prepayments made pursuant to Section 8.3 shall be applied only to the Notes of the holders who have elected to participate in such prepayment. SECTION 8.5. MATURITY; SURRENDER, ETC. In the case of each prepayment of Notes pursuant to this Section 8, the principal amount of each Note to be prepaid shall mature and become due and payable on the date fixed for such prepayment, together with interest on such principal amount accrued to such date and the applicable Make-Whole Amount, if any. From and after such date, unless the Company shall fail to pay such principal amount when so due and payable, together with the interest and Make-Whole Amount, if any, as aforesaid, interest on such principal amount shall cease to accrue. Any Note paid or prepaid in full shall be surrendered to the Company and cancelled and shall not be reissued, and no Note shall be issued in lieu of any prepaid principal amount of any Note. SECTION 8.6. PURCHASE OF NOTES. The Company will not and will not permit any Affiliate to purchase, redeem, prepay or otherwise acquire, directly or indirectly, any of the outstanding Notes except upon the payment or prepayment of the Notes in accordance with the terms of this Agreement and the Notes. The Company will promptly cancel all Notes acquired by it or any Affiliate pursuant to any payment, prepayment or purchase of Notes pursuant to any provision of this Agreement and no Notes may be issued in substitution or exchange for any such Notes. SECTION 8.7. MAKE-WHOLE AMOUNT. The term "MAKE-WHOLE AMOUNT" means, with respect to any Note, an amount equal to the excess, if any, of the Discounted Value of the Remaining Scheduled Payments with respect to the Called Principal of such Note over the amount of such Called Principal, PROVIDED that the Make-Whole Amount may in no event be less than zero. For the purposes of determining the Make-Whole Amount, the following terms have the following meanings: "CALLED PRINCIPAL" means, with respect to any Note, the principal of such Note that is to be prepaid pursuant to Section 8.2 or Section 8.3 or has become or is declared to be immediately due and payable pursuant to Section 12. 1, as the context requires. "DISCOUNTED VALUE" means, with respect to the Called Principal of any Note, the amount obtained by discounting all Remaining Scheduled Payments with respect to such Called Principal from their respective scheduled due dates to the Settlement Date with respect to such Called Principal, in accordance with accepted financial practice and at a discount factor (applied on the same periodic basis as that on which interest on the Notes is payable) equal to the Reinvestment Yield with respect to such Called Principal. 18 Old Dominion Freight Line, Inc. Note Purchase Agreement "REINVESTMENT YIELD" means, with respect to the Called Principal of any Note, 0.5% over the yield to maturity implied by (i) the yields reported, as of 10:00 A.M. (New York City time) on the second Business Day preceding the Settlement Date with respect to such Called Principal, on the display designated as "Page 500" on the Telerate Access Service (or such other display as may replace Page 500 on Telerate Access Service) for actively traded U.S. Treasury securities having a maturity equal to the Remaining Average Life of such Called Principal as of such Settlement Date, or (ii) if such yields are not reported as of such time or the yields reported as of such time are not ascertainable, the Treasury Constant Maturity Series Yields reported, for the latest day for which such yields have been so reported as of the second Business Day preceding the Settlement Date with respect to such Called Principal, in Federal Reserve Statistical Release H. 15 (519) (or any comparable successor publication) for actively traded U.S. Treasury securities having a constant maturity equal to the Remaining Average Life of such Called Principal as of such Settlement Date. Such implied yield will be determined, if necessary, by (a) converting U.S. Treasury bill quotations to bond-equivalent yields in accordance with accepted financial practice and (b) interpolating linearly between (1) the actively traded U.S. Treasury security with the duration closest to and greater than the Remaining Average Life and (2) the actively traded U.S. Treasury security with the duration closest to and less than the Remaining Average Life. "REMAINING AVERAGE LIFE" means, with respect to any Called Principal, the number of years (calculated to the nearest one-twelfth year) obtained by dividing (i) such Called Principal into (ii) the sum of the products obtained by multiplying (a) the principal component of each Remaining Scheduled Payment with respect to such Called Principal by (b) the number of years (calculated to the nearest one-twelfth year) that will elapse between the Settlement Date with respect to such Called Principal and the scheduled due date of such Remaining Scheduled Payment. "REMAINING SCHEDULED PAYMENTS" means, with respect to the Called Principal of any Note, all payments of such Called Principal and interest thereon that would be due after the Settlement Date with respect to such Called Principal if no payment of such Called Principal were made prior to its scheduled due date, PROVIDED that if such Settlement Date is not a date on which interest payments are due to be made under the terms of the Notes, then the amount of the next succeeding scheduled interest payment will be reduced by the amount of interest accrued to such Settlement Date and required to be paid on such Settlement Date pursuant to Section 8.2, Section 8.3 or Section 12.1. "SETTLEMENT DATE" means, with respect to the Called Principal of any Note, the date on which such Called Principal is to be prepaid pursuant to Section 8.2 or Section 8.3 or has become or is declared to be immediately due and payable pursuant to Section 12.1, as the context requires. 19 Old Dominion Freight Line, Inc. Note Purchase Agreement SECTION 9. AFFIRMATIVE COVENANTS. The Company covenants that so long as any of the Notes are outstanding: SECTION 9.1. COMPLIANCE WITH LAW. The Company will and will cause each of its Subsidiaries to comply with all laws, ordinances or governmental rules or regulations to which each of them is subject, including, without limitation, ERISA and Environmental Laws, and will obtain and maintain in effect all licenses, certificates, permits, franchises and other governmental authorizations necessary to the ownership of their respective properties or to the conduct of their respective businesses, in each case to the extent necessary to ensure that non-compliance with such laws, ordinances or governmental rules or regulations or failures to obtain or maintain in effect such licenses, certificates, permits, franchises and other governmental authorizations could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. SECTION 9.2. INSURANCE. The Company will and will cause each of its Subsidiaries to maintain, with financially sound and reputable insurers, insurance with respect to their respective properties and businesses against such casualties and contingencies, of such types, on such terms and in such amounts (including deductibles, co-insurance and self-insurance, if adequate reserves are maintained with respect thereto) as is customary in the case of entities of established reputations engaged in the same or a similar business and similarly situated. SECTION 9.3. MAINTENANCE OF PROPERTIES. The Company will and will cause each of its Subsidiaries to maintain and keep, or cause to be maintained and kept, their respective properties in good repair, working order and condition (other than ordinary wear and tear), so that the business carried on in connection therewith may be properly conducted at all times, PROVIDED that this Section shall not prevent the Company or any Subsidiary from discontinuing the operation and the maintenance of any of its properties if such discontinuance is desirable in the conduct of its business and the Company has concluded that such discontinuance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. SECTION 9.4. PAYMENT OF TAXES AND CLAIMS. The Company will and will cause each of its Subsidiaries to file all tax returns required to be filed in any jurisdiction and to pay and discharge all taxes shown to be due and payable on such returns and all other taxes, assessments, governmental charges, or levies imposed on them or any of their properties, assets, income or franchises, to the extent such taxes and assessments have become due and payable and before they have become delinquent and all claims for which sums have become due and payable that have or might become a Lien on properties or assets of the Company or any Subsidiary, PROVIDED that neither the Company nor any Subsidiary need pay any such tax or assessment or claims if (i) the amount, applicability or validity thereof is contested by the Company or such Subsidiary on a timely basis in good faith and in appropriate proceedings, and the Company or a Subsidiary has established adequate reserves therefor in accordance with GAAP on the books of the Company or such Subsidiary or (ii) the nonpayment of all such taxes and assessments in the aggregate could not reasonably be expected to have a Material Adverse Effect. 20 Old Dominion Freight Line, Inc. Note Purchase Agreement SECTION 9.5. CORPORATE EXISTENCE, ETC. The Company will at all times preserve and keep in full force and effect its corporate existence. Subject to Sections 10.6 and 10.7, the Company will at all times preserve and keep in full force and effect the corporate existence of each of its Subsidiaries (unless merged into the Company or a Subsidiary) and all rights and franchises of the Company and its Subsidiaries unless, in the good faith judgment of the Company, the termination of or failure to preserve and keep in full force and effect such corporate existence, right or franchise could not, individually or in the aggregate, have a Material Adverse Effect. SECTION 10. NEGATIVE COVENANTS. The Company covenants that so long as any of the Notes are outstanding: SECTION 10.1. CONSOLIDATED TANGIBLE NET WORTH. The Company will not, at any time, permit Consolidated Tangible Net Worth to be less than the sum of (a) $55,000,000, plus (b) an aggregate amount equal to 50% of its Consolidated Net Income (but, in each case, only if a positive number) for each completed fiscal quarter beginning with the fiscal quarter ended June 30, 1996. SECTION 10.2. FIXED CHARGES COVERAGE RATIO. The Company will not, at any time, permit the Fixed Charges Coverage Ratio to be less than 1.75 to 1. SECTION 10.3. LIMITATIONS ON DEBT. (a) The Company will not at any time permit Consolidated Funded Debt to exceed 55% of Consolidated Total Capitalization as of the then most recently ended fiscal quarter of the Company. (b) The Company will not at any time permit Funded Debt of Subsidiaries to exceed the remainder of (i) 15% of Consolidated Tangible Net Worth minus (ii) the aggregate amount of Debt of the Company and its Subsidiaries then outstanding secured by Liens permitted by Section 10.4(k). SECTION 10.4. LIENS. The Company will not, and will not permit any of its Subsidiaries to, directly or indirectly create, incur, assume or permit to exist (upon the happening of a contingency or otherwise) any Lien on or with respect to any property or asset (including, without limitation, any document or instrument in respect of goods or accounts receivable) of the Company or any such Subsidiary, whether now owned or held or hereafter acquired, or any income or profits therefrom or assign or otherwise convey any right to receive income or profits (unless it (i) makes, or causes to be made, effective provision whereby the Notes will be equally and ratably secured with any and all other obligations thereby secured, such security to be pursuant to an agreement reasonably satisfactory to the Required Holders and, in any such case, the Notes shall have the benefit, to the fullest extent that, and with such priority as, the holders of the Notes may be entitled under applicable law, of an equitable Lien on such property and (ii) delivers to each holder of the Notes an opinion of counsel in form and substance satisfactory to the Required Holders to the effect that such agreement constitutes a valid and perfected lien on 21 Old Dominion Freight Line, Inc. Note Purchase Agreement and security interest in such security and that the Notes are equally and ratably secured with any and all other obligations thereby secured), except: (a) Liens for taxes, assessments or other governmental charges which are not yet due and payable or the payment of which is not at the time required by Section 9.4; (b) Liens created by or resulting from any judgment or award which are being actively contested in good faith by appropriate proceedings and with respect to which adequate reserves are being maintained in accordance with GAAP; (c) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen and other similar Liens, in each case, incurred in the ordinary course of business for sums not yet due and payable or the payment of which is not at the time required by Section 9.4; (d) leases or subleases granted to others, easements, rights-of-way, restrictions and other similar charges or encumbrances, in each case incidental to, and not interfering with, the ordinary conduct of the business of the Company or any of its Subsidiaries, PROVIDED that such Liens do not, in the aggregate, materially detract from the value of such property; (e) other Liens incidental to the normal conduct of the business of the Company or any Subsidiary or the ownership of its property and assets which are not incurred in connection with the borrowing of money and which do not in the aggregate materially impair the use of such property and assets in the operation of the business of the Company or any Subsidiary or materially impair the value of such property and assets for the purposes of such business; (f) Liens on property or assets of the Company or any of its Subsidiaries securing Debt owing to the Company or to any of its Wholly-Owned Subsidiaries; (g) Liens existing on the date of this Agreement and reflected on Schedule 10.4; (h) any Lien renewing, extending or refunding any Lien permitted by paragraph (g) or paragraph (i) of this Section 10.4, PROVIDED that (i) the principal amount of Debt secured by such Lien immediately prior to such extension, renewal or refunding is not increased or the maturity thereof reduced, (ii) such Lien is not extended to any other property, and (iii) immediately after such extension, renewal or refunding no Default or Event of Default would exist; (i) any Lien created to secure all or any part of the purchase price, or to secure Debt incurred or assumed to pay all or any part of the purchase price or cost of construction, of real or tangible personal property (or any improvement thereon or 22 Old Dominion Freight Line, Inc. Note Purchase Agreement thereto) acquired or constructed by the Company or a Subsidiary after the date of the Closing, PROVIDED that (i) any such Lien shall extend solely to the item or items of such property (or improvement thereon) so acquired or constructed and, if required by the terms of the instrument originally creating such Lien, other property (or improvement thereon) which is an improvement to or is acquired for specific use in connection with such acquired or constructed property (or improvement thereon) or which is real property being improved by such acquired or constructed property (or improvement thereon), (ii) the principal amount of the Debt secured by any such Lien shall at no time exceed an amount equal to the Fair Market Value (as determined in good faith by the board of directors of the Company) of such property (or improvement thereon) at the time of such acquisition or construction, and (iii) any such Lien shall be created contemporaneously with, or within 120 days after, the acquisition or completion of construction of such property; (j) any Lien existing on property of a Person immediately prior to its being consolidated with or merged into the Company or a Subsidiary or its becoming a Subsidiary, or any Lien existing on any property acquired by the Company or any Subsidiary at the time such property is so acquired (whether or not the Debt secured thereby shall have been assumed), PROVIDED that (i) no such Lien shall have been created or assumed in contemplation of such consolidation or merger or such Person's becoming a Subsidiary or such acquisition of property, (ii) each such Lien shall extend solely to the item or items of property so acquired and, if required by the terms of the instrument originally creating such Lien, other property which is an improvement to or is acquired for specific use in connection with such acquired property and (iii) the principal amount of the Debt secured by any such Lien shall at no time exceed an amount equal to the Fair Market Value (as determined in good faith by the board of directors of the Company) of such property (or such improvement thereon) at the time of such acquisition; and (k) other Liens not otherwise permitted by paragraphs (a) through (j) securing Debt of the Company or any Subsidiary, provided that all Debt secured by such Liens does not at any time exceed the remainder of (i) 15% of Consolidated Tangible Net Worth minus (ii) the aggregate amount of Funded Debt of Subsidiaries then outstanding. SECTION 10.5.RESTRICTED PAYMENTS AND RESTRICTED INVESTMENTS. (a) LIMITATION. The Company will not, and will not permit any of its Subsidiaries to, declare, make or incur any liability to make any Restricted Payment or make or authorize any Restricted Investment UNLESS immediately after giving effect to such action: 23 Old Dominion Freight Line, Inc. Note Purchase Agreement (i) the sum of (x) the aggregate value of all Restricted Investments of the Company and its Subsidiaries (valued immediately after such action), plus (y) the aggregate amount of Restricted Payments of the Company and its Subsidiaries declared or made during the period commencing on March 31, 1996 and ending on the date such Restricted Payment or Restricted Investment is declared or made, inclusive, would not exceed the sum of (A) $5,000,000, plus (B) 50% of Consolidated Net Income for such period (or minus 100% of Consolidated Net Income for such period if Consolidated Net Income for such period is a loss), plus (C) the aggregate amount of Net Proceeds of Capital Stock for such period; and (ii) no Default or Event of Default would exist. (b) TIME OF PAYMENT. The Company will not, nor will it permit any of its Subsidiaries to, authorize a Restricted Payment that is not payable within 60 days of authorization. SECTION 10.6. MERGER, CONSOLIDATION, ETC. The Company will not, and will not permit any of its Subsidiaries to, consolidate with or merge with any other corporation or convey, transfer or lease substantially all of its assets in a single transaction or series of transactions to any Person (except that (x) a Subsidiary of the Company may consolidate with or merge with, or convey, transfer or lease substantially all of its assets in a single transaction or series of transactions to, the Company or another Wholly-Owned Subsidiary of the Company and (y) each of the Company and its Subsidiaries may convey, transfer or lease all of its assets in compliance with the provisions of Section 10.7), provided that the foregoing restriction does not apply to the consolidation or merger of the Company with, or the conveyance, transfer or lease of substantially all of the assets of the Company in a single transaction or series of transactions to, any Person so long as: (a) the successor formed by such consolidation or the survivor of such merger or the Person that acquires by conveyance, transfer or lease substantially all of the assets of the Company as an entirety, as the case may be (the "SUCCESSOR CORPORATION"), shall be a solvent corporation organized and existing under the laws of the United States of America, any State thereof or the District of Columbia; (b) if the Company is not the Successor Corporation, such corporation shall have executed and delivered to each holder of Notes its assumption of the due and punctual performance and observance of each covenant and condition of this Agreement and the Notes (pursuant to such agreements and instruments as shall be reasonably satisfactory to the Required Holders), and the Company shall have caused to be delivered to each holder of Notes an opinion of nationally recognized independent counsel, or other 24 Old Dominion Freight Line, Inc. Note Purchase Agreement independent counsel reasonably satisfactory to the Required Holders, to the effect that all agreements or instruments effecting such assumption are enforceable in accordance with their terms and comply with the terms hereof; and (c) immediately after giving effect to such transaction, (i) no Default or Event of Default would exist and (ii) Consolidated Funded Debt does not exceed 55% of Consolidated Total Capitalization. No such conveyance, transfer or lease of substantially all of the assets of the Company shall have the effect of releasing the Company or any Successor Corporation from its liability under this Agreement or the Notes. SECTION 10.7. SALE OF ASSETS, ETC. Except as permitted under Section 10.6, the Company will not, and will not permit any of its Subsidiaries to, make any Asset Disposition unless: (a) in the good faith opinion of the Company, the Asset Disposition is in exchange for consideration having a Fair Market Value at least equal to that of the property exchanged and is in the best interest of the Company or such Subsidiary; and (b) immediately after giving effect to the Asset Disposition, (i) no Default or Event of Default would exist and (ii) Consolidated Funded Debt does not exceed 55% of Consolidated Total Capitalization; and (c) immediately after giving effect to the Asset Disposition, (i) the Disposition Value of all property that was the subject of any Asset Disposition occurring in the period of four fiscal quarters of the Company then next ending would not exceed 15% of Consolidated Assets as of the end of the then most recently ended fiscal quarter of the Company and (ii) all of the property of the Company and its Subsidiaries that was the subject of any Asset Disposition occurring in the period of four fiscal quarters of the Company then next ending did not account for more than 15% of Consolidated Net Income for the then most recently ended four quarter fiscal period. If the Net Proceeds Amount for any Transfer is applied to a Reinvestment Application within 270 days after such Transfer, then such Transfer, only for the purpose of determining compliance with subsection (c) of this Section 10.7 as of a date on or after the Net Proceeds Amount is so applied, shall be deemed not to be an Asset Disposition. SECTION 10.8. SALE-AND-LEASEBACKS. The Company will not, and will not permit any Subsidiary to, enter into any Sale-and-Leaseback Transaction unless the Net Proceeds Amount received by the Company or such Subsidiary in respect of such Sale-and-Leaseback Transaction is applied within 270 days of the consummation thereof to a Reinvestment Application. 25 Old Dominion Freight Line, Inc. Note Purchase Agreement SECTION 10.9. TRANSACTIONS WITH AFFILIATES. The Company will not and will not permit any Subsidiary to enter into directly or indirectly any transaction or Material group of related transactions (including without limitation the purchase, lease, sale or exchange of properties of any kind or the rendering of any service) with any Affiliate (other than the Company or another Subsidiary), except in the ordinary course and pursuant to the reasonable requirements of the Company's or such Subsidiary's business and upon fair and reasonable terms no less favorable to the Company or such Subsidiary than would be obtainable in a comparable arm's-length transaction with a Person not an Affiliate. SECTION 10.10. LINE OF BUSINESS. The Company will not, and will not permit any of its Subsidiaries to, engage in any business if, as a result, the general nature of the business in which the Company and its Subsidiaries, taken as a whole, would then be engaged would be substantially changed from the general nature of the business in which the Company and its Subsidiaries, taken as a whole, are engaged on the date of this Agreement. SECTION 11. EVENTS OF DEFAULT. An "EVENT OF DEFAULT" shall exist if any of the following conditions or events shall occur and be continuing: (a) the Company defaults in the payment of any principal or Make-Whole Amount, if any, on any Note when the same becomes due and payable, whether at maturity or at a date fixed for prepayment or by declaration or otherwise; or (b) the Company defaults in the payment of any interest on any Note for more than five Business Days after the same becomes due and payable; or (c) the Company defaults in the performance of or compliance with any term contained in Sections 10.1 through 10.3 or Sections 10.5 through 10.8; or (d) the Company defaults in the performance of or compliance with any term contained herein (other than those referred to in paragraphs (a), (b) and (c) of this Section 11) and such default is not remedied within 30 days after the earlier of (i) a Responsible Officer obtaining actual knowledge of such default and (ii) the Company receiving written notice of such default from any holder of a Note (any such written notice to be identified as a "notice of default" and to refer specifically to this paragraph (d) of Section 11); or (e) any representation or warranty made in writing by or on behalf of the Company or by any officer of the Company in this Agreement or in any writing furnished in connection with the transactions contemplated hereby proves to have been false or incorrect in any material respect on the date as of which made; or (f) (i) the Company or any Subsidiary is in default (as principal or as guarantor or other surety) in the payment of any principal of or premium or make-whole 26 Old Dominion Freight Line, Inc. Note Purchase Agreement amount or interest on any Debt that is outstanding in an aggregate principal amount of at least $5,000,000 beyond any period of grace provided with respect thereto, or (ii) the Company or any Subsidiary is in default in the performance of or compliance with any term of any evidence of any Debt in an aggregate outstanding principal amount of at least $5,000,000 or of any mortgage, indenture or other agreement relating thereto or any other condition exists, and as a consequence of such default or condition such Debt has become, or has been declared, due and payable before its stated maturity or before its regularly scheduled dates of payment, or (iii) as a consequence of the occurrence or continuation of any event or condition (other than the passage of time or the right of the holder of Debt to convert such Debt into equity interests), (x) the Company or any Subsidiary has become obligated to purchase or repay Debt before its regular maturity or before its regularly scheduled dates of payment in an aggregate outstanding principal amount of at least $5,000,000, or (y) one or more Persons have the right to require the Company or any Subsidiary so to purchase or repay such Debt and shall have exercised such right; or (g) the Company or any Subsidiary (i) is generally not paying, or admits in writing its inability to pay, its debts as they become due, (ii) files, or consents by answer or otherwise to the filing against it of, a petition for relief or reorganization or arrangement or any other petition in bankruptcy, for liquidation or to take advantage of any bankruptcy, insolvency, reorganization, moratorium or other similar law of any jurisdiction, (iii) makes an assignment for the benefit of its creditors, (iv) consents to the appointment of a custodian, receiver, trustee or other officer with similar powers with respect to it or with respect to any substantial part of its property, (v) is adjudicated as insolvent or to be liquidated, or (vi) takes corporate action for the purpose of any of the foregoing; or (h) a court or governmental authority of competent jurisdiction enters an order appointing, without consent by the Company or any of its Subsidiaries, a custodian, receiver, trustee or other officer with similar powers with respect to it or with respect to any substantial part of its property, or constituting an order for relief or approving a petition for relief or reorganization or any other petition in bankruptcy or for liquidation or to take advantage of any bankruptcy or insolvency law of any jurisdiction, or ordering the dissolution, winding-up or liquidation of the Company or any of its Subsidiaries, or any such petition shall be filed against the Company or any of its Subsidiaries and such petition shall not be dismissed within 60 days; or (i) a final judgment or judgments for the payment of money aggregating in excess of $5,000,000 (excluding any judgment, or portion thereof, as to which a solvent insurer shall have accepted responsibility) are rendered against one or more of the Company and its Subsidiaries and which judgments are not, within 45 days after entry thereof, bonded, discharged or stayed pending appeal, or are not discharged within 45 days after the expiration of such stay; or 27 Old Dominion Freight Line, Inc. Note Purchase Agreement (j) if (i) any Plan shall fail to satisfy the minimum funding standards of ERISA or the Code for any plan year or part thereof or a waiver of such standards or extension of any amortization period is sought or granted under section 412 of the Code, (ii) a notice of intent to terminate any Plan shall have been or is reasonably expected to be filed with the PBGC or the PBGC shall have instituted proceedings under ERISA section 4042 to terminate or appoint a trustee to administer any Plan or the PBGC shall have notified the Company or any ERISA Affiliate that a Plan may become a subject of any such proceedings, (iii) the aggregate "amount of unfunded benefit liabilities" (within the meaning of section 4001(a)(18) of ERISA) under all Plans, determined in accordance with Title IV of ERISA, shall exceed $5,000,000, (iv) the Company or any ERISA Affiliate shall have incurred or is reasonably expected to incur any liability pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of the Code relating to employee benefit plans, (v) the Company or any ERISA Affiliate withdraws from any Multiemployer Plan, or (vi) the Company or any Subsidiary establishes or amends any employee welfare benefit plan that provides post-employment welfare benefits in a manner that would increase the liability of the Company or any Subsidiary thereunder; and any such event or events described in clauses (i) through (vi) above, either individually or together with any other such event or events, could reasonably be expected to have a Material Adverse Effect. As used in Section 11(j), the terms "employee benefit plan" and "employee welfare benefit plan" shall have the respective meanings assigned to such terms in Section 3 of ERISA. SECTION 12. REMEDIES ON DEFAULT, ETC. SECTION 12.1. ACCELERATION. (a) If an Event of Default with respect to the Company described in paragraph (g) or (h) of Section 11 (other than an Event of Default described in clause (i) of paragraph (g) or described in clause (vi) of paragraph (g) by virtue of the fact that such clause encompasses clause (i) of paragraph (g)) has occurred, all the Notes then outstanding shall automatically become immediately due and payable. (b) If any other Event of Default has occurred and is continuing, any holder or holders of more than 25% in principal amount of the Notes of any Series at the time outstanding may at any time at its or their option, by notice or notices to the Company, declare all the Notes of such Series then outstanding to be immediately due and payable. (c) If any Event of Default described in paragraph (a) or (b) of Section 11 has occurred and is continuing, any holder or holders of Notes at the time outstanding affected by such Event of Default may at any time, at its or their option, by notice or notices to the Company, declare all the Notes held by it or them to be immediately due and payable. Upon any Note becoming due and payable under this Section 12.1, whether automatically or by declaration, such Note will forthwith mature and the entire unpaid principal amount of such Note, plus (x) all accrued and unpaid interest thereon and (y) the Make-Whole Amount determined in respect of such principal amount (to the full extent permitted by applicable law), 28 Old Dominion Freight Line, Inc. Note Purchase Agreement shall all be immediately due and payable, in each and every case without presentment, demand, protest or further notice, all of which are hereby waived. The Company acknowledges, and the parties hereto agree, that each holder of a Note has the right to maintain its investment in the Notes free from repayment by the Company (except as herein specifically provided for), and that the provision for payment of a Make-Whole Amount by the Company in the event that the Notes are prepaid or are accelerated as a result of an Event of Default, is intended (a) to provide compensation for the deprivation of such right under such circumstances and (b) to be liquidated damages for loss of bargain and not a penalty. SECTION 12.2. OTHER REMEDIES. If any Default or Event of Default has occurred and is continuing, and irrespective of whether any Notes have become or have been declared immediately due and payable under Section 12.1, the holder of any Note at the time outstanding may proceed to protect and enforce the rights of such holder by an action at law, suit in equity or other appropriate proceeding, whether for the specific performance of any agreement contained herein or in any Note, or for an injunction against a violation of any of the terms hereof or thereof, or in aid of the exercise of any power granted hereby or thereby or by law or otherwise. SECTION 12.3. RESCISSION. At any time after any Notes of any Series have been declared due and payable pursuant to clause (b) of Section 12.1, the holders of not less than 66-2/3% in principal amount of the Notes of such Series then outstanding, by written notice to the Company, may rescind and annul any such declaration and its consequences if (a) the Company has paid all overdue interest on the Notes of such Series, all principal of and Make-Whole Amount, if any, on any Notes of such Series that are due and payable and are unpaid other than by reason of such declaration, and all interest on such overdue principal and Make-Whole Amount, if any, and (to the extent permitted by applicable law) any overdue interest in respect of the Notes of such Series, at the Default Rate, (b) all Events of Default and Defaults, other than non-payment of amounts that have become due solely by reason of such declaration, have been cured or have been waived pursuant to Section 17, and (c) no judgment or decree has been entered for the payment of any monies due pursuant hereto or to the Notes of such Series. No rescission and annulment under this Section 12.3 will extend to or affect any subsequent Event of Default or Default or impair any right consequent thereon. SECTION 12.4. NO WAIVERS OR ELECTION OF REMEDIES, EXPENSES, ETC. No course of dealing and no delay on the part of any holder of any Note in exercising any right, power or remedy shall operate as a waiver thereof or otherwise prejudice such holder's rights, powers or remedies. No right, power or remedy conferred by this Agreement or by any Note upon any holder thereof shall be exclusive of any other right, power or remedy referred to herein or therein or now or hereafter available at law, in equity, by statute or otherwise. Without limiting the obligations of the Company under Section 15, the Company will pay to the holder of each Note on demand such further amount as shall be sufficient to cover all costs and expenses of such holder incurred in any enforcement or collection under this Section 12, including, without limitation, reasonable attorneys' fees, expenses and disbursements. 29 Old Dominion Freight Line, Inc. Note Purchase Agreement SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES. SECTION 13.1. REGISTRATION OF NOTES. The Company shall keep at its principal executive office a register for the registration and registration of transfers of Notes. The name and address of each holder of one or more Notes, each transfer thereof and the name and address of each transferee of one or more Notes shall be registered in such register. Prior to due presentment for registration of transfer, the Person in whose name any Note shall be registered shall be deemed and treated as the owner and holder thereof for all purposes hereof, and the Company shall not be affected by any notice or knowledge to the contrary. The Company shall give to any holder of a Note that is an Institutional Investor promptly upon request therefor, a complete and correct copy of the names and addresses of all registered holders of Notes. SECTION 13.2. TRANSFER AND EXCHANGE OF NOTES. Upon surrender of any Note at the principal executive office of the Company for registration of transfer or exchange (and in the case of a surrender for registration of transfer, duly endorsed or accompanied by a written instrument of transfer duly executed by the registered holder of such Note or its attorney duly authorized in writing and accompanied by the address for notices of each transferee of such Note or part thereof), the Company shall execute and deliver, at the Company's expense (except as provided below), one or more new Notes (as requested by the holder thereof) of the same Series in exchange therefor, in an aggregate principal amount equal to the unpaid principal amount of the surrendered Note. Each such new Note shall be payable to such Person as such holder may request and shall be substantially in the form of Exhibit 1. Each such new Note shall be dated and bear interest from the date to which interest shall have been paid on the surrendered Note or dated the date of the surrendered Note if no interest shall have been paid thereon. The Company may require payment of a sum sufficient to cover any stamp tax or governmental charge imposed in respect of any such transfer of Notes. Notes shall not be transferred in denominations of less than $1,000,000, PROVIDED that if necessary to enable the registration of transfer by a holder of its entire holding of Notes, one Note may be in a denomination of less than $1,000,000. Any transferee, by its acceptance of a Note registered in its name (or the name of its nominee), shall be deemed to have made the representation set forth in Section 6.2. SECTION 13.3. REPLACEMENT OF NOTES. Upon receipt by the Company of evidence reasonably satisfactory to it of the ownership of and the loss, theft, destruction or mutilation of any Note (which evidence shall be, in the case of an Institutional Investor, notice from such Institutional Investor of such ownership and such loss, theft, destruction or mutilation), and (a) in the case of loss, theft or destruction, of indemnity reasonably satisfactory to it (PROVIDED that if the holder of such Note is, or is a nominee for, an original Purchaser or another holder of a Note with a minimum net worth of at least $100,000,000, such Person's own unsecured agreement of indemnity shall be deemed to be satisfactory), or (b) in the case of mutilation, upon surrender and cancellation thereof,the Company at its own expense shall execute and deliver, in lieu thereof, a new Note of the same Series, dated and bearing interest from the date to which interest shall have been 30 Old Dominion Freight Line, Inc. Note Purchase Agreement paid on such lost, stolen, destroyed or mutilated Note or dated the date of such lost, stolen, destroyed or mutilated Note if no interest shall have been paid thereon. SECTION 14. PAYMENTS ON NOTES. SECTION 14.1. PLACE OF PAYMENT. Subject to Section 14.2, payments of principal, Make-Whole Amount, if any, and interest becoming due and payable on the Notes shall be made in High Point, North Carolina at the principal office of the Company in such jurisdiction. The Company may at any time, by notice to each holder of a Note, change the place of payment of the Notes so long as such place of payment shall be either the principal office of the Company in such jurisdiction or the principal office of a bank or trust company in such jurisdiction. SECTION 14.2. HOME OFFICE PAYMENT. So long as you or your nominee shall be the holder of any Note, and notwithstanding anything contained in Section 14.1 or in such Note to the contrary, the Company will pay all sums becoming due on such Note for principal, Make-Whole Amount, if any, and interest by the method and at the address specified for such purpose below your name in Schedule A, or by such other method or at such other address as you shall have from time to time specified to the Company in writing for such purpose, without the presentation or surrender of such Note or the making of any notation thereon, except that upon written request of the Company made concurrently with or reasonably promptly after payment or prepayment in full of any Note, you shall surrender such Note for cancellation, reasonably promptly after any such request, to the Company at its principal executive office or at the place of payment most recently designated by the Company pursuant to Section 14.1. Prior to any sale or other disposition of any Note held by you or your nominee you will, at your election, either endorse thereon the amount of principal paid thereon and the last date to which interest has been paid thereon or surrender such Note to the Company in exchange for a new Note or Notes pursuant to Section 13.2. The Company will afford the benefits of this Section 14.2 to any Institutional Investor that is the direct or indirect transferee of any Note purchased by you under this Agreement and that has made the same agreement relating to such Note as you have made in this Section 14.2. SECTION 15. EXPENSES, ETC. SECTION 15.1. TRANSACTION EXPENSES. Whether or not the transactions contemplated hereby are consummated, the Company will pay all costs and expenses (including reasonable attorneys' fees of a special counsel and, if reasonably required, local or other counsel) incurred by you and the Other Purchasers or each other holder of a Note in connection with such transactions and in connection with any amendments, waivers or consents under or in respect of this Agreement or the Notes (whether or not such amendment, waiver or consent becomes effective), including, without limitation: (a) the costs and expenses incurred in enforcing or defending (or determining whether or how to enforce or defend) any rights under this Agreement or the Notes or in responding to any subpoena or other legal process or informal investigative 31 Old Dominion Freight Line, Inc. Note Purchase Agreement demand issued in connection with this Agreement or the Notes, or by reason of being a holder of any Note, and (b) the costs and expenses, including financial advisors' fees, incurred in connection with the insolvency or bankruptcy of the Company or any Subsidiary or in connection with any work-out or restructuring of the transactions contemplated hereby and by the Notes. The Company will pay, and will save you and each other holder of a Note harmless from, all claims in respect of any fees, costs or expenses, if any, of brokers and finders (other than those retained by you). SECTION 15.2. SURVIVAL. The obligations of the Company under this Section 15 will survive the payment or transfer of any Note, the enforcement, amendment or waiver of any provision of this Agreement or the Notes, and the termination of this Agreement. SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT. All representations and warranties contained herein shall survive the execution and delivery of this Agreement and the Notes, the purchase or transfer by you of any Note or portion thereof or interest therein and the payment of any Note, and may be relied upon by any subsequent holder of a Note, regardless of any investigation made at any time by or on behalf of you or any other holder of a Note. All statements contained in any certificate or other instrument delivered by or on behalf of the Company pursuant to this Agreement shall be deemed representations and warranties of the Company under this Agreement. Subject to the preceding sentence, this Agreement and the Notes embody the entire agreement and understanding between you and the Company and supersede all prior agreements and understandings relating to the subject matter hereof. SECTION 17. AMENDMENT AND WAIVER. SECTION 17.1. REQUIREMENTS. This Agreement and the Notes may be amended, and the observance of any term hereof or of the Notes may be waived (either retroactively or prospectively), with (and only with) the written consent of the Company and the Required Holders, except that (a) no amendment or waiver of any of the provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term (as it is used therein), will be effective as to you unless consented to by you in writing, and (b) no such amendment or waiver may, without the written consent of the holder of each Note at the time outstanding affected thereby, (i) subject to the provisions of Section 12 relating to acceleration or rescission, change the amount or time of any prepayment or payment of principal of, or reduce the rate or change the time of payment or method of computation of interest or of the Make-Whole Amount on, the Notes, (ii) change the percentage of the principal amount of the Notes the holders of which are required to consent to any such amendment or waiver, or (iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or 20. 32 Old Dominion Freight Line, Inc. Note Purchase Agreement SECTION 17.2. SOLICITATION OF HOLDERS OF NOTES. (a) SOLICITATION. The Company will provide each holder of the Notes (irrespective of the amount of Notes then owned by it) with sufficient information, sufficiently far in advance of the date a decision is required, to enable such holder to make an informed and considered decision with respect to any proposed amendment, waiver or consent in respect of any of the provisions hereof or of the Notes. The Company will deliver executed or true and correct copies of each amendment, waiver or consent effected pursuant to the provisions of this Section 17 to each holder of outstanding Notes promptly following the date on which it is executed and delivered by, or receives the consent or approval of, the requisite holders of Notes. (b) PAYMENT. The Company will not directly or indirectly pay or cause to be paid any remuneration, whether by way of supplemental or additional interest, fee or otherwise, or grant any security, to any holder of Notes as consideration for or as an inducement to the entering into by any holder of Notes or any waiver or amendment of any of the terms and provisions hereof unless such remuneration is concurrently paid, or security is concurrently granted, on the same terms, ratably to each holder of Notes then outstanding even if such holder did not consent to such waiver or amendment. SECTION 17.3. BINDING EFFECT, ETC. Any amendment or waiver consented to as provided in this Section 17 applies equally to all holders of Notes and is binding upon them and upon each future holder of any Note and upon the Company without regard to whether such Note has been marked to indicate such amendment or waiver. No such amendment or waiver will extend to or affect any obligation, covenant, agreement, Default or Event of Default not expressly amended or waived or impair any right consequent thereon. No course of dealing between the Company and the holder of any Note nor any delay in exercising any rights hereunder or under any Note shall operate as a waiver of any rights of any holder of such Note. As used herein, the term "this Agreement" and references thereto shall mean this Agreement as it may from time to time be amended or supplemented. SECTION 17.4. NOTES HELD BY COMPANY, ETC. Solely for the purpose of determining whether the holders of the requisite percentage of the aggregate principal amount of Notes then outstanding approved or consented to any amendment, waiver or consent to be given under this Agreement or the Notes, or have directed the taking of any action provided herein or in the Notes to be taken upon the direction of the holders of a specified percentage of the aggregate principal amount of Notes then outstanding, Notes directly or indirectly owned by the Company or any of its Affiliates shall be deemed not to be outstanding. SECTION 18. NOTICES. All notices and communications provided for hereunder shall be in writing and sent (a) by telefacsimile if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service (charges prepaid), or (b) by a recognized overnight delivery service (with charges prepaid). Any such notice must be sent: 33 Old Dominion Freight Line, Inc. Note Purchase Agreement (i) if to you or your nominee, to you or it at the address specified for such communications in Schedule A, or at such other address as you or it shall have specified to the Company in writing, (ii) if to any other holder of any Note, to such holder at such address as such other holder shall have specified to the Company in writing, or (iii) if to the Company, to the Company at its address set forth at the beginning hereof to the attention of J. Wes Frye, or at such other address as the Company shall have specified to the holder of each Note in writing. Notices under this Section 18 will be deemed given only when actually received. SECTION 19. REPRODUCTION OF DOCUMENTS. This Agreement and all documents relating thereto, including, without limitation, (a) consents, waivers and modifications that may hereafter be executed, (b) documents received by you at the Closing (except the Notes themselves), and (c) financial statements, certificates and other information previously or hereafter furnished to you, may be reproduced by you by any photographic, photostatic, microfilm, microcard, miniature photographic or other similar process and you may destroy any original document so reproduced. The Company agrees and stipulates that, to the extent permitted by applicable law, any such reproduction shall be admissible in evidence as the original itself in any judicial or administrative proceeding (whether or not the original is in existence and whether or not such reproduction was made by you in the regular course of business) and any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence. This Section 19 shall not prohibit the Company or any other holder of Notes from contesting any such reproduction to the same extent that it could contest the original, or from introducing evidence to demonstrate the inaccuracy of any such reproduction. SECTION 20. CONFIDENTIAL INFORMATION. For the purposes of this Section 20, "CONFIDENTIAL INFORMATION" means information delivered to you by or on behalf of the Company or any Subsidiary in connection with the transactions contemplated by or otherwise pursuant to this Agreement that is proprietary in nature and that was clearly marked or labeled or otherwise adequately identified when received by you as being confidential information of the Company or such Subsidiary, PROVIDED that such term does not include information that (a) was publicly known or otherwise known to you prior to the time of such disclosure, (b) subsequently becomes publicly known through no act or omission by you or any person acting on your behalf, (c) otherwise becomes known to you other than through disclosure by the Company or any Subsidiary or (d) constitutes financial statements delivered to you under Section 7.1 that are otherwise publicly available. You will maintain the confidentiality of such Confidential Information in accordance with procedures adopted by you in good faith to protect confidential information of third parties delivered to you, PROVIDED that 34 Old Dominion Freight Line, Inc. Note Purchase Agreement you may deliver or disclose Confidential Information to (i) your directors, officers, employees, agents, attorneys and affiliates (to the extent such disclosure reasonably relates to the administration of the investment represented by your Notes), (ii) your financial advisors and other professional advisors who agree to hold confidential the Confidential Information substantially in accordance with the terms of this Section 20, (iii) any other holder of any Note, (iv) any Institutional Investor to which you sell or offer to sell such Note or any part thereof or any participation therein (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by the provisions of this Section 20), (v) any Person from which you offer to purchase any security of the Company (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by the provisions of this Section 20), (vi) any federal or state regulatory authority having jurisdiction over you, (vii) the National Association of Insurance Commissioners or any similar organization, or any nationally recognized rating agency that requires access to information about your investment portfolio or (viii) any other Person to which such delivery or disclosure may be necessary or appropriate (w) to effect compliance with any law, rule, regulation or order applicable to you, (x) in response to any subpoena or other legal process, (y) in connection with any litigation to which you are a party or (z) if an Event of Default has occurred and is continuing, to the extent you may reasonably determine such delivery and disclosure to be necessary or appropriate in the enforcement or for the protection of the rights and remedies under your Notes and this Agreement. Each holder of a Note, by its acceptance of a Note, will be deemed to have agreed to be bound by and to be entitled to the benefits of this Section 20 as though it were a party to this Agreement. On reasonable request by the Company in connection with the delivery to any holder of a Note of information required to be delivered to such holder under this Agreement or requested by such holder (other than a holder that is a party to this Agreement or its nominee), such holder will enter into an agreement with the Company embodying the provisions of this Section 20. SECTION 21. SUBSTITUTION OF PURCHASER. You shall have the right to substitute any one of your Affiliates as the purchaser of the Notes that you have agreed to purchase hereunder, by written notice to the Company, which notice shall be signed by both you and such Affiliate, shall contain such Affiliate's agreement to be bound by this Agreement and shall contain a confirmation by such Affiliate of the accuracy with respect to it of the representations set forth in Section 6. Upon receipt of such notice, wherever the word "you" is used in this Agreement (other than in this Section 21), such word shall be deemed to refer to such Affiliate in lieu of you. In the event that such Affiliate is so substituted as a purchaser hereunder and such Affiliate thereafter transfers to you all of the Notes then held by such Affiliate, upon receipt by the Company of notice of such transfer, wherever the word "you" is used in this Agreement (other than in this Section 21), such word shall no longer be deemed to refer to such Affiliate, but shall refer to you, and you shall have all the rights of an original holder of the Notes under this Agreement. 35 Old Dominion Freight Line, Inc. Note Purchase Agreement SECTION 22. MISCELLANEOUS. SECTION 22.1. SUCCESSORS AND ASSIGNS. All covenants and other agreement contained in this Agreement by or on behalf of any of the parties hereto bind and inure to the benefit of their respective successors and assigns (including, without limitation, any subsequent holder of a Note) whether so expressed or not. SECTION 22.2. PAYMENTS DUE ON NON-BUSINESS DAYS. Anything in this Agreement or the Notes to the contrary notwithstanding, any payment of principal of or Make-Whole Amount or interest on any Note that is due on a date other than a Business Day shall be made on the next succeeding Business Day without including the additional days elapsed in the computation of the interest payable on such next succeeding Business Day. SECTION 22.3. SEVERABILITY. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall (to the full extent permitted by law) not invalidate or render unenforceable such provision in any other jurisdiction. SECTION 22.4. CONSTRUCTION. Each covenant contained herein shall be construed (absent express provision to the contrary) as being independent of each other covenant contained herein, so that compliance with any one covenant shall not (absent such an express contrary provision) be deemed to excuse compliance with any other covenant. Where any provision herein refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision shall be applicable whether such action is taken directly or indirectly by such Person. SECTION 22.5. COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which shall be an original but all of which together shall constitute one instrument. Each counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto. SECTION 22.6. GOVERNING LAW. This Agreement shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the law of the State of New York excluding choice-of-law principles of the law of such State that would require the application of the laws of a jurisdiction other than such State. SECTION 22.7. ADDITIONAL DEBT. Subject to the terms and provisions hereof, the Company may, from time to time, issue and sell additional senior promissory notes and may, in connection with the documentation thereof, incorporate by reference various provisions of this agreement. Such incorporation by reference shall not modify, dilute or otherwise affect the terms and provisions hereof and in no event shall any holder of Notes have any obligation to purchase any such additional promissory notes referred to above. 36 Old Dominion Freight Line, Inc. Note Purchase Agreement If you are in agreement with the foregoing, please sign the form of agreement on the accompanying counterpart of this Agreement and return it to the Company, whereupon the foregoing shall become a binding agreement between you and the Company. Very truly yours, OLD DOMINION FREIGHT LINE, INC. By /s/ John A. Ebeling Its President The foregoing is hereby agreed to as of the date thereof. NATIONWIDE LIFE INSURANCE COMPANY By /s/ Michael D. Groseclose Its Associate Vice President Corporate Fixed-Income Securities NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY By /s/ Michael D. Groseclose Its Associate Vice President Corporate Fixed-Income Securities NEW YORK LIFE INSURANCE COMPANY By /s/ David L. Bangs Its Investment Vice President NEW YORK LIFE INSURANCE AND ANNUITY CORPORATION By /s/ John E. Schumacher Its Investment Vice President 37 INFORMATION RELATING TO PURCHASERS PRINCIPAL AMOUNT OF NOTES TO NAME AND ADDRESS OF PURCHASER BE PURCHASED SERIES $8,000,000 2002 NOTES NATIONWIDE LIFE INSURANCE COMPANY One Nationwide Plaza (1-33-07) Columbus, Ohio 43215-2220 Attention: Corporate Fixed-Income Securities Payments All payments on or in respect of the Notes to be by bank wire transfer of Federal or other immediately available funds (identifying each payment as "Old Dominion Freight Line, Inc., 7.30% Senior Notes due 2002, PPN 679580 A* 1, principal or interest") to: Morgan Guaranty Trust Company of New York (ABA #021-000-238) JOURNAL #999-99-024 F/A/O Nationwide Life Insurance Company Custody A/C #71615 Attention: Custody Service Department Notices All notices of payment on or in respect of the Notes and written confirmation of each such payment to: Nationwide Life Insurance Company One Nationwide Plaza (1-32-09) Columbus, Ohio 43215-2220 Attention: Corporate Money Management All notices and communications other than those in respect to payments to be addressed: Nationwide Life Insurance Company One Nationwide Plaza (1-33-07) Columbus, Ohio 43215-2220 Attention: Corporate Fixed-Income Securities Name of Nominee in which Notes are to be issued: None Taxpayer I.D. Number: 31-4156830 SCHEDULE A (to Note Purchase Agreement) PRINCIPAL AMOUNT OF NOTES TO NAME AND ADDRESS OF PURCHASER BE PURCHASED SERIES $2,000,000 2002 NOTES NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY One Nationwide Plaza (1-33-07) Columbus, Ohio 43215-2220 Attention: Corporate Fixed-Income Securities Payments All payments on or in respect of the Notes to be by bank wire transfer of Federal or other immediately available funds (identifying each payment as "Old Dominion Freight Line, Inc., 7.30% Senior Notes due 2002, PPN 679580 A* 1, principal or interest") to: Morgan Guaranty Trust Company of New York (ABA #021-000-238) JOURNAL #999-99-024 F/A/O Nationwide Life and Annuity Insurance Company Custody A/C #71620 Attention: Custody Service Department Notices All notices of payment on or in respect of the Notes and written confirmation of each such payment to: Nationwide Life and Annuity Insurance Company One Nationwide Plaza (1-32-09) Columbus, Ohio 43215-2220 Attention: Corporate Money Management All notices and communications other than those in respect to payments to be addressed: Nationwide Life and Annuity Insurance Company One Nationwide Plaza (1-33-07) Columbus, Ohio 43215-2220 Attention: Corporate Fixed-Income Securities Name of Nominee in which Notes are to be issued: None Taxpayer I.D. Number: 31-1000740 A-2 PRINCIPAL AMOUNT OF NOTES TO NAME AND ADDRESS OF PURCHASER BE PURCHASED SERIES $10,000,000 2006 NOTES NEW YORK LIFE INSURANCE COMPANY 51 Madison Avenue New York, New York 10010 Attention: Investment Department, Private Finance Group, Room 206 Telefacsimile Number: (212) 447-4122 Payments All payments on or in respect of the Notes to be by bank wire transfer of Federal or other immediately available funds (identifying each payment as "Old Dominion Freight Line, Inc., 7.59% Senior Notes due 2006, PPN 679580 A@ 9, principal, premium or interest") to: Morgan Guaranty Trust Company of New York (ABA #021-000-238) New York, New York 10015 for credit to: New York Life Insurance Company General Account Number 810-00-000 Notices All notices with respect to payments and written confirmation of each such payment, to be addressed: New York Life Insurance Company 51 Madison Avenue New York, New York 10010-1603 Attention: Treasury Department, Securities Income Section, Room 209 All other notices and communications to be addressed as first provided above, with a copy to: Office of the General Counsel, Investment Section, Room 10SB, Telefacsimile Number (212) 576-8340 Name of Nominee in which Notes are to be issued: None Taxpayer I.D. Number: 13-5582869 A-3 PRINCIPAL AMOUNT OF NOTES TO NAME AND ADDRESS OF PURCHASER BE PURCHASED SERIES $10,000,000 2006 NOTES NEW YORK LIFE INSURANCE AND ANNUITY CORPORATION c/o New York Life Insurance Company 51 Madison Avenue New York, New York 10010-1603 Attention: Investment Department, Room 206 Telecopier Number: (212) 447-4122 Payments All payments on or in respect of the Notes to be by bank wire transfer of Federal or other immediately available funds (identifying each payment as "Old Dominion Freight Line, Inc., 7.59% Senior Notes due 2006, PPN 679580 A@ 9, principal, premium or interest") to: Chemical Bank (ABA #021-000-128) New York, New York for credit to: New York Life Insurance and Annuity Corporation General Account Number 008-0-57001 Notices All notices and communications regarding unscheduled or optional payments to be addressed: New York Life Insurance and Annuity Corporation c/o New York Life Insurance Company 51 Madison Avenue New York, New York 10010-1603 Attention: Treasury Department Securities Income Section, Room 209 Telefacsimile Number: (212) 576-4296 All other notices and communications to be addressed as first provided above, with a copy to: Investment Section, Office of the General Counsel, Room 10SB, Telefacsimile Number: (212) 576-8340 Name of Nominee in which Notes are to be issued: None Taxpayer I.D. Number: 13-3044743 A-4 DEFINED TERMS As used herein, the following terms have the respective meanings set forth below or set forth in the Section hereof following such term: "AFFILIATE" means, at any time, and with respect to any Person, (a) any other Person that at such time directly or indirectly through one or more intermediaries Controls, or is Controlled by, or is under common Control with, such first Person, and (b) any Person beneficially owning or holding, directly or indirectly, 10% or more of any class of voting or equity interests of the Company or any Subsidiary or any corporation of which the Company and its Subsidiaries beneficially own or hold, in the aggregate, directly or indirectly, 10% or more of any class of voting or equity interests. As used in this definition, "CONTROL" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise. Unless the context otherwise clearly requires, any reference to an "AFFILIATE" is a reference to an Affiliate of the Company. "ASSET DISPOSITION" means any Transfer except: (a) any Transfer from the Company to a Subsidiary or from a Subsidiary to another Subsidiary, which in either case is for Fair Market Value, and so long as immediately before and immediately after the consummation of any such Transfer and after giving effect thereto, no Default or Event of Default exists; and (b) any Transfer made in the ordinary course of business and involving only property that is either (i) inventory held for sale or (ii) equipment, fixtures, supplies or materials no longer required in the operation of the business of the Company or any of its Subsidiaries or that is obsolete. "BUSINESS DAY" means any day other than a Saturday, a Sunday or a day on which commercial banks in New York, New York or High Point, North Carolina are required or authorized to be closed. "CAPITAL LEASE" means, at any time, a lease with respect to which the lessee is required concurrently to recognize the acquisition of an asset and the incurrence of a liability in accordance with GAAP. "CAPITAL LEASE OBLIGATION" means, with respect to any Person and a Capital Lease, the amount of the obligation of such Person as the lessee under such Capital Lease which would, in accordance with GAAP, appear as a liability on a balance sheet of such Person. "CHANGE IN CONTROL" has the meaning set forth in Section 8.3(f). "CLOSING" is defined in Section 3. SCHEDULE B (to Note Purchase Agreement) "CODE" means the Internal Revenue Code of 1986, as amended from time to time, and the rules and regulations promulgated thereunder from time to time. "COMPANY" means Old Dominion Freight Line, Inc., a Virginia corporation, and any successor corporation permitted under Section 10.6. "CONFIDENTIAL INFORMATION" is defined in Section 20. "CONSOLIDATED FUNDED DEBT" means, as of any date of determination, the total of all Funded Debt of the Company and its Subsidiaries outstanding on such date, after eliminating all offsetting debits and credits between the Company and its Subsidiaries and all other items required to be eliminated in the course of the preparation of consolidated financial statements of the Company and its Subsidiaries in accordance with GAAP. "CONSOLIDATED INCOME AVAILABLE FOR FIXED CHARGES" means, with respect to any period, Consolidated Net Income for such period plus all amounts deducted in the computation thereof on account of (a) Fixed Charges, (b) taxes imposed on or measured by income or excess profits, (c) depreciation and (d) amortization. "CONSOLIDATED NET INCOME" means, with reference to any period, the net income (or loss) of the Company and its Subsidiaries for such period (taken as a cumulative whole), as determined in accordance with GAAP, after eliminating all offsetting debits and credits between the Company and its Subsidiaries and all other items required to be eliminated in the course of the preparation of consolidated financial statements of the Company and its Subsidiaries in accordance with GAAP. "CONSOLIDATED TANGIBLE NET WORTH" means, at any time, the stockholders equity of the Company and its Subsidiaries determined on a consolidated basis as of such time in accordance with GAAP MINUS the net book amount of all assets of the Company and its Subsidiaries (after deducting any reserves applicable thereto) which would be shown as intangible assets on a consolidated balance sheet of the Company and its Subsidiaries as of such time prepared in accordance with GAAP. "CONSOLIDATED TOTAL CAPITALIZATION" means, at any time, the sum of Consolidated Tangible Net Worth and Consolidated Funded Debt. "CONTROL EVENT" has the meaning set forth in Section 8.3(g). "CURRENT MATURITIES OF FUNDED DEBT" means, at any time and with respect to any item of Funded Debt, the portion of such Funded Debt outstanding at such time which by the terms of such Funded Debt or the terms of any instrument or agreement relating thereto is due on demand or within one year from such time (whether by sinking fund, other required prepayment or final payment at maturity) and is not directly or indirectly renewable, extendible or refundable at the B-2 option of the obligor under an agreement or firm commitment in effect at such time to a date one year or more from such time. "DEBT" means, with respect to any Person, without duplication, (a) its liabilities for borrowed money; (b) its liabilities for the deferred purchase price of property acquired by such Person (excluding accounts payable arising in the ordinary course of business but including, without limitation, all liabilities created or arising under any conditional sale or other title retention agreement with respect to any such property); (c) its Capital Lease Obligations; (d) letters of credit issued for the account of such Person including, but without duplication, amounts required to be reimbursed by such Person to the issuer of the letter of credit; (e) all liabilities for borrowed money secured by any Lien with respect to any property owned by such Person (whether or not it has assumed or otherwise become liable for such liabilities); and (f) any Guaranty of such Person with respect to liabilities of a type described in any of clauses (a) through (e) hereof. Debt of any Person shall include all obligations of such Person of the character described in clauses (a) through (f) to the extent such Person remains legally liable in respect thereof notwithstanding that any such obligation is deemed to be extinguished under GAAP. Debt shall exclude (i) any such liabilities, obligations or Guaranties referred to in clauses (a) through (f) above if owed by the Company to a Wholly-Owned Subsidiary or by a Subsidiary to the Company or a Wholly-Owned Subsidiary and (ii) any unfunded obligations which may exist now or hereafter in any pension plan maintained by the Company or any Subsidiary. "DEFAULT" means an event or condition the occurrence or existence of which would, with the lapse of time or the giving of notice or both, become an Event of Default. "DEFAULT RATE" means that rate of interest that is the greater of (i) 2% per annum above the rate of interest stated in clause (a) of the first paragraph of any Note or (ii) 2% over the rate of interest publicly announced by Citibank, N.A., in New York, New York as its "base" or "prime" rate. "DISPOSITION VALUE" means, at any time, with respect to any property (a) in the case of property that does not constitute Subsidiary Stock, the book value thereof, valued at the time of such disposition in good faith by the Company, and B-3 (b) in the case of property that constitutes Subsidiary Stock, an amount equal to that percentage of book value of the assets of the Subsidiary that issued such stock as is equal to the percentage that the book value of such Subsidiary Stock represents of the book value of all of the outstanding capital stock of such Subsidiary (assuming, in making such calculations, that all Securities convertible into such capital stock are so converted and giving full effect to all transactions that would occur or be required in connection with such conversion) determined at the time of the disposition thereof, in good faith by the Company. "DISTRIBUTION" means, in respect of any corporation, association or other business entity: (a) dividends or other distributions or payments on capital stock or other equity interest of such corporation, association or other business entity (except distributions in such stock or other equity interest); and (b) the redemption or acquisition of such stock or other equity interests or of warrants, rights or other options to purchase such stock or other equity interests. "ENVIRONMENTAL LAWS" means any and all Federal, state, local, and foreign statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any materials into the environment, including but not limited to those related to hazardous substances or wastes, air emissions and discharges to waste or public systems. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect. "ERISA AFFILIATE" means any trade or business (whether or not incorporated) that is treated as a single employer together with the Company under section 414 of the Code. "EVENT OF DEFAULT" is defined in Section 11. "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended. "FAIR MARKET VALUE" means, at any time and with respect to any property, the sale value of such property that would be realized in an arm's-length sale at such time between an informed and willing buyer and an informed and willing seller (neither being under a compulsion to buy or sell). "FIXED CHARGES" means, with respect to any period, the sum of (a) Interest Charges for such period and (b) Lease Rentals for such period. B-4 "FIXED CHARGES COVERAGE RATIO" means, at any time, the ratio of (a) Consolidated Income Available for Fixed Charges for the period of four consecutive fiscal quarters ending on, or most recently ended prior to, such time to (b) Fixed Charges for such period. "FUNDED DEBT" means, with respect to any Person, but without duplication (i) all Debt of such Person which by its terms or by the terms of any instrument or agreement relating thereto matures, or which is otherwise payable or unpaid, one year or more from, or is directly or indirectly renewable or extendible at the option of the obligor in respect thereof to a date one year or more (including, without limitation, an option of such obligor under a revolving credit or similar agreement obligating the lender or lenders to extend credit over a period of one year or more) from, the date of the creation thereof, (ii) Capitalized Lease Obligations, (iii) Current Maturities of Funded Debt (iv) all other Debt of such Person outstanding under a working capital line or revolving credit agreement or similar agreement unless there shall have been during the 12 calendar month period immediately preceding any date of determination a period of at least 30 consecutive days on each of which there shall have been no Debt outstanding thereunder and (v) all Guaranties of any of the foregoing. "GAAP" means generally accepted accounting principles as in effect from time to time in the United States of America. "GOVERNMENTAL AUTHORITY" means (a) the government of (i) the United States of America or any State or other political subdivision thereof, or (ii) any jurisdiction in which the Company or any Subsidiary conducts all or any part of its business, or which asserts jurisdiction over any properties of the Company or any Subsidiary, or (b) any entity exercising executive, legislative, judicial, regulatory or administrative functions of, or pertaining to, any such government. "GUARANTY" means, with respect to any Person, any obligation (except the endorsement in the ordinary course of business of negotiable instruments for deposit or collection) of such Person guaranteeing or in effect guaranteeing any indebtedness, dividend or other obligation of any other Person in any manner, whether directly or indirectly, including (without limitation) obligations incurred through an agreement, contingent or otherwise, by such Person: (a) to purchase such indebtedness or obligation or any property constituting security therefor; (b) to advance or supply funds (i) for the purchase or payment of such indebtedness or obligation, or (ii) to maintain any working capital or other balance sheet B-5 condition or any income statement condition of any other Person or otherwise to advance or make available funds for the purchase or payment of such indebtedness or obligation; (c) to lease properties or to purchase properties or services primarily for the purpose of assuring the owner of such indebtedness or obligation of the ability of any other Person to make payment of the indebtedness or obligation; or (d) otherwise to assure the owner of such indebtedness or obligation against loss in respect thereof. In any computation of the indebtedness or other liabilities of the obligor under any Guaranty, the indebtedness or other obligations that are the subject of such Guaranty shall be assumed to be direct obligations of such obligor. "HAZARDOUS MATERIAL" means any and all pollutants, toxic or hazardous wastes or any other substances that might pose a hazard to health or safety, the removal of which may be required or the generation, manufacture, refining, production, processing, treatment, storage, handling, transportation, transfer, use, disposal, release, discharge, spillage, seepage, or filtration of which is or shall be restricted, prohibited or penalized by any applicable law (including, without limitation, asbestos, urea formaldehyde foam insulation and polychlorinated biphenyls). "HOLDER" means, with respect to any Note, the Person in whose name such Note is registered in the register maintained by the Company pursuant to Section 13.1. "INSTITUTIONAL INVESTOR" means (a) any original purchaser of a Note, (b) any holder of a Note holding more than 5% of the aggregate principal amount of the Notes then outstanding, and (c) any bank, trust company, savings and loan association or other financial institution, any pension plan, any investment company, any insurance company, any broker or dealer, or any other similar financial institution or entity, regardless of legal form. "INTEREST CHARGES" means, with respect to any period, all amounts (in each case, eliminating all offsetting debits and credits between the Company and its Subsidiaries and all other items required to be eliminated in the course of the preparation of consolidated financial statements of the Company and its Subsidiaries in accordance with GAAP) deducted in computing Consolidated Net Income on account of interest on Debt and shall include, in any event: (a) all interest in respect of Debt of the Company and its Subsidiaries (including imputed interest on Capital Lease Obligations) deducted in determining Consolidated Net Income for such period, (b) all Debt discount and expense amortized or required to be amortized in the determination of Consolidated Net Income for such period, (c) fees and commissions for letters of credit and bankers acceptances, and (d) the net interest cost in respect of interest rate swaps, interest rate caps and other hedging arrangements. "INVESTMENT" means any investment, made in cash or by delivery of property, by the Company or any of its Subsidiaries (i) in any Person, whether by acquisition of stock, Debt or B-6 other obligation or Security, or by loan, Guaranty, advance, capital contribution or otherwise, or (ii) in any property. "LEASE RENTALS" means, with respect to any period, the sum of the minimum amount of rental and other obligations required to be paid during such period by the Company or any Subsidiary as lessee under all leases of real or personal property (other than Capital Leases), excluding any amounts required to be paid by the lessee (whether or not therein designated as rental or additional rental) (a) which are on account of maintenance and repairs, insurance, taxes, assessments, water rates and similar charges, or (b) which are based on profits, revenues or sales realized by the lessee from the leased property or otherwise based on the performance of the lessee. "LIEN" means, with respect to any Person, any mortgage, lien, pledge, charge, security interest or other encumbrance, or any interest or title of any vendor, lessor, lender or other secured party to or of such Person under any conditional sale or other title retention agreement or Capital Lease, upon or with respect to any property or asset of such Person (including in the case of stock, stockholder agreements, voting trust agreements and all similar arrangements). "MAKE-WHOLE AMOUNT" is defined in Section 8.7. "MATERIAL" means material in relation to the business, operations, affairs, financial condition, assets, properties, or prospects of the Company and its Subsidiaries taken as a whole. "MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the business, operations, affairs, financial condition, assets or properties of the Company and its Subsidiaries taken as a whole, or (b) the ability of the Company to perform its obligations under this Agreement and the Notes, or (c) the validity or enforceability of this Agreement or the Notes. "MEMORANDUM" is defined in Section 5.3. "MULTIEMPLOYER PLAN" means any Plan that is a "multiemployer plan" (as such term is defined in section 4001(a)(3) of ERISA). "NET PROCEEDS AMOUNT" means, with respect to any Transfer of any property by any Person, an amount equal to the DIFFERENCE of (a) the aggregate amount of the consideration (valued at the Fair Market Value of such consideration at the time of the consummation of such Transfer) received by such Person in respect of such Transfer, MINUS (b) all ordinary and reasonable out-of-pocket costs and expenses actually incurred by such Person in connection with such Transfer. "NET PROCEEDS OF CAPITAL STOCK" means, with respect to any period, cash proceeds (net of all costs and out-of-pocket expenses in connection therewith, including, without limitation, B-7 placement, underwriting and brokerage fees and expenses), received by the Company and its Subsidiaries during such period, from the sale of all capital stock (other than Redeemable capital stock) of the Company, including in such net proceeds: (a) the net amount paid upon issuance and exercise during such period of any right to acquire any capital stock, or paid during such period to convert a convertible debt Security to capital stock (but excluding any amount paid to the Company upon issuance of such convertible debt Security); and (b) any amount paid to the Company upon issuance of any convertible debt Security issued after March 31, 1996 and thereafter converted to capital stock during such period. "NOTES" is defined in Section 1. "OFFICER'S CERTIFICATE" means a certificate of a Senior Financial Officer or of any other officer of the Company whose responsibilities extend to the subject matter of such certificate. "OTHER AGREEMENTS" is defined in Section 2. "OTHER PURCHASERS" is defined in Section 2. "PBGC" means the Pension Benefit Guaranty Corporation referred to and defined in ERISA or any successor thereto. "PERSON" means an individual, partnership, corporation, limited liability company, association, trust, unincorporated organization, or a government or agency or political subdivision thereof. "PLAN" means an "employee benefit plan" (as defined in section 3(3) of ERISA) that is or, within the preceding five years, has been established or maintained, or to which contributions are or, within the preceding five years, have been made or required to be made, by the Company or any ERISA Affiliate or with respect to which the Company or any ERISA Affiliate may have any liability. "PROPERTY" or "PROPERTIES" means, unless otherwise specifically limited, real or personal property of any kind, tangible or intangible, choate or inchoate. "QPAM EXEMPTION" means Prohibited Transaction Class Exemption 84-14 issued by the United States Department of Labor. "REDEEMABLE" means, with respect to the capital stock of any Person, each share of such Person's capital stock that is: B-8 (a) redeemable, payable or required to be purchased or otherwise retired or extinguished, or convertible into Debt of such Person (i) at a fixed or determinable date, whether by operation of sinking fund or otherwise, (ii) at the option of any Person other than such Person, or (iii) upon the occurrence of a condition not solely within the control of such Person; or (b) convertible into other Redeemable capital stock. "REINVESTMENT APPLICATION" means, with respect to any Transfer of property, the application of an amount equal to the Net Proceeds Amount with respect to such Transfer (i) to the acquisition by the Company or any Subsidiary of operating assets of the Company or such Subsidiary to be used in the ordinary course of business of such Person or (ii) for reinvestment in the business of the Company or such Subsidiary as such business is conducted as of the date of this Agreement. "REQUIRED HOLDERS" means, at any time, the holders of at least 66-2/3% in principal amount of the Notes of each Series at the time outstanding (exclusive of Notes then owned by the Company or any of its Affiliates). "RESPONSIBLE OFFICER" means any Senior Financial Officer and any other officer of the Company with responsibility for the administration of the relevant portion of this agreement. "RESTRICTED INVESTMENTS" means all Investments except the following: (a) property to be used in the ordinary course of business of the Company and its Subsidiaries; (b) current assets arising from the sale of goods and services in the ordinary course of business of the Company and its Subsidiaries; (c) Investments in one or more Subsidiaries or any Person that concurrently with such Investment becomes a Subsidiary; (d) Investments existing on the date of the Closing and disclosed in Schedule C; (e) Investments in United States Governmental Securities, PROVIDED that such obligations mature within 365 days from the date of acquisition thereof; (f) Investments in certificates of deposit or banker's acceptances issued by an Acceptable Bank, PROVIDED that such obligations mature within 365 days from the date of acquisition thereof; B-9 (g) Investments in commercial paper given the highest rating by a credit rating agency of recognized national standing and maturing not more than 270 days from the date of creation thereof; (h) Investments in Repurchase Agreements; and (i) Investments in tax-exempt obligations of any state of the United States of America, or any municipality of any such state, in each case rated "AA" or better by S&P, "Aa2" or better by Moody's or an equivalent rating by any other credit rating agency of recognized national standing, PROVIDED that such obligations mature within 365 days from the date of acquisition thereof. As of any date of determination, each Restricted Investment shall be valued at the lesser of: (x) the amount at which such Restricted Investment is shown on the books of the Company or any of its Subsidiaries in accordance with GAAP; and (y) the excess of (A) the cost thereof to the Company or its Subsidiary over (B) any return of capital (after income taxes applicable thereto) upon such Restricted Investment through the sale or other liquidation thereof or part thereof or otherwise. Notwithstanding anything contained in the foregoing to the contrary, if any Restricted Investment is not shown on the books of the Company or any of its Subsidiaries, such Restricted Investment shall be valued in accordance with clause (y) above. As used in this definition of "Restricted Investments": "ACCEPTABLE BANK" means any bank or trust company (i) which is organized under the laws of the United States of America or any State thereof, (ii) which has capital, surplus and undivided profits aggregating at least $100,000,000, and (iii) whose long-term unsecured debt obligations (or the long-term unsecured debt obligations of the bank holding company owning all of the capital stock of such bank or trust company) shall have been given a rating of "A-" or better by S&P, "A3" or better by Moody's or an equivalent rating by any other credit rating agency of recognized national standing. "ACCEPTABLE BROKER-DEALER" means any Person other than a natural person (i) which is registered as a broker or dealer pursuant to the Exchange Act and (ii) whose long-term unsecured debt obligations shall have been given a rating of "A" or better by S&P, "A2" or better by Moody's or an equivalent rating by any other credit rating agency of recognized national standing. "MOODY'S" means Moody's Investors Service, Inc. "REPURCHASE AGREEMENT" means any written agreement B-10 (a) that provides for (i) the transfer of one or more United States Governmental Securities in an aggregate principal amount at least equal to the amount of the Transfer Price (defined below) to the Company or any of its Subsidiaries from an Acceptable Bank or an Acceptable Broker-Dealer against a transfer of funds (the "TRANSFER PRICE") by the Company or such Subsidiary to such Acceptable Bank or Acceptable Broker-Dealer, and (ii) a simultaneous agreement by the Company or such Subsidiary, in connection with such transfer of funds, to transfer to such Acceptable Bank or Acceptable Broker-Dealer the same or substantially similar United States Governmental Securities for a price not less than the Transfer Price plus a reasonable return thereon at a date certain not later than 365 days after such transfer of funds, (b) in respect of which the Company or such Subsidiary shall have the right, whether by contract or pursuant to applicable law, to liquidate such agreement upon the occurrence of any default thereunder, and (c) in connection with which the Company or such Subsidiary, or an agent thereof, shall have taken all action required by applicable law or regulations to perfect a Lien in such United States Governmental Securities. "S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill, Inc. "UNITED STATES GOVERNMENTAL SECURITY" means any direct obligation of, or obligation guaranteed by, the United States of America, or any agency controlled or supervised by or acting as an instrumentality of the United States of America pursuant to authority granted by the Congress of the United States of America, so long as such obligation or guarantee shall have the benefit of the full faith and credit of the United States of America which shall have been pledged pursuant to authority granted by the Congress of the United States of America. "RESTRICTED PAYMENT" means any Distribution in respect of the Company or any Subsidiary of the Company (other than on account of capital stock or other equity interests of a Subsidiary owned legally and beneficially by the Company or another Subsidiary), including, without limitation, any Distribution resulting in the acquisition by the Company of Securities which would constitute treasury stock. For purposes of this Agreement, the amount of any Restricted Payment made in property shall be the greater of (x) the Fair Market Value of such property (as determined in good faith by the board of directors (or equivalent governing body) of the Person making such Restricted Payment) and (y) the net book value thereof on the books of such Person, in each case determined as of the date on which such Restricted Payment is made. "SALE-AND-LEASEBACK TRANSACTION" means a transaction or series of transactions pursuant to which the Company or any Subsidiary shall sell or transfer to any Person (other than the Company or a Subsidiary) any property, whether now owned or hereafter acquired, and, as part of the same transaction or series of transactions, the Company or any Subsidiary shall rent or B-11 lease as lessee (other than pursuant to a Capital Lease), or similarly acquire the right to possession or use of, such property or one or more properties which it intends to use for the same purpose or purposes as such property. "SECURITIES ACT" means the Securities Act of 1933, as amended from time to time. "SENIOR FINANCIAL OFFICER" means the chief financial officer, principal accounting officer, treasurer or comptroller of the Company. "SERIES" is defined in Section 1. "SUBSIDIARY" means, as to any Person, any corporation, association or other business entity in which such Person or one or more of its Subsidiaries or such Person and one or more of its Subsidiaries owns sufficient equity or voting interests to enable it or them (as a group) ordinarily, in the absence of contingencies, to elect a majority of the directors (or Persons performing similar functions) of such entity, and any partnership or joint venture if more than a 50% interest in the profits or capital thereof is owned by such Person or one or more of its Subsidiaries or such Person and one or more of its Subsidiaries (unless such partnership can and does ordinarily take major business actions without the prior approval of such Person or one or more of its Subsidiaries). Unless the context otherwise clearly requires, any reference to a "Subsidiary" is a reference to a Subsidiary of the Company. "SUBSIDIARY STOCK" means, with respect to any Person, the stock (or any options or warrants to purchase stock or other Securities exchangeable for or convertible into stock) of any Subsidiary of such Person. "SUCCESSOR CORPORATION" has the meaning set forth in Section 10.6. "TRANSFER" means, with respect to any Person, any transaction in which such Person sells, conveys, transfers or leases (as lessor) any of its property, including, without limitation, Subsidiary Stock. For purposes of determining the application of the Net Proceeds Amount in respect of any Transfer, the Company may designate any Transfer as one or more separate Transfers each yielding a separate Net Proceeds Amount. In any such case, (a) the Disposition Value of any property subject to each such separate Transfer and (b) the amount of Consolidated Net Income attributable to any property subject to each such separate Transfer shall be determined by ratably allocating the aggregate Disposition Value of, and the aggregate Consolidated Net Income attributable to, all property subject to all such separate Transfers to each such separate Transfer on a proportionate basis. "2002 NOTES" is defined in Section 1. "2006 NOTES" is defined in Section 1. "WHOLLY-OWNED SUBSIDIARY" means, at any time, any Subsidiary one hundred percent (100%) of all of the equity interests (except directors' qualifying shares) and voting interests of B-12 which are owned by any one or more of the Company and the Company's other Wholly-Owned Subsidiaries at such time. B-13 EXISTING INVESTMENTS DESCRIPTION AMOUNT 1. The Company: Certificate of Deposit $200,000.00 First Union National Bank (Deposit for self-insured workers' compensation status) Maturity: 12/25/96 4.83% yield 4.95% 2. The Company: Certificate of Deposit $300,000.00 First Union National Bank (Deposit for self-insured workers' compensation status) Maturity: 9/23/96 5.47% yield 5.62% 3. ODIS, INC.: Delaware Trust - Conestoga Fund $200,480.36 Tax Free Mutual Fund Various maturities and yields ----------- TOTAL $700,480,36 SCHEDULE C (to Note Purchase Agreement) SCHEDULE 5.4 (i) SUBSIDIARIES OF THE COMPANY JURISDICTION PERCENTAGE OF CORPORATE NAME OF INCORPORATION SHARES HELD ODIS, INC. Delaware 100% (ii) AFFILIATES OF THE COMPANY Old Dominion Truck Leasing, Inc. E&J Enterprises Robert A. Cox, Jr., Trustee U/A dated as of 7/15/75 with Earl E. Congdon and John R. Congdon (iii) DIRECTORS AND SENIOR OFFICERS OF THE COMPANY
Earl E. Congdon Chairman of the Board of Directors and Chief Executive Officer John R. Congdon Vice Chairman of the Board of Directors John A. Ebeling President, Chief Operating Officer and Director Harold G. Hoak Director Franz F. Holscher Director J. Wes Frye Treasurer, Chief Financial Officer and Asst. Secretary Joel B. McCarty, Jr. General Counsel and Secretary Ernest Brantley Vice President - Operations David S. Congdon Vice President - Quality J. Edward Richardson Vice President - Equipment and Maintenance J. Timothy Turner Vice President - Sales John B. Yowell Vice President - Corporate Services
SCHEDULE 5.4 (to Note Purchase Agreement) SCHEDULE 5.5 LIST OF FINANCIAL STATEMENTS 1993 Annual Report to Shareholders 1994 Annual Report to Shareholders 1995 Annual Report to Shareholders SCHEDULE 5.5 (to Note Purchase Agreement) SCHEDULE 5.14 ERISA AFFILIATES AND PLANS 401K -- Old Dominion 401K Retirement Plan 125 -- Old Dominion Section 125 Plan Health and Long-Term Disability -- Old Dominion Benefit Plan: o Group Health o Group Dental o Group Life Insurance o Long-Term Disability o Variable Employee Benefit Trust SCHEDULE 5.14 (to Note Purchase Agreement) SCHEDULE 5.15 EXISTING DEBT
BORROWER LENDER OUTSTANDING AMOUNT DESCRIPTION 1. Company Philadelphia National Bank $465,280 5.50% Promissory Note due July, 1996 secured by 81 tractors 2. Company Philadelphia National Bank $1,666,668 5.20% Promissory Note due January, 1998 secured by 700 1993 Wabash trailers 3. Company Philadelphia National Bank $4,875,000 6.64% Unsecured Promissory Note due August, 1999 4. Company First Union $570,000 8.00% Promissory Note due May, 1997 secured by 69 1992 tractors 5. Company First Union $56,569 5.50% Promissory Note due July, 1996 secured by 27 1993 tractors 6. Company First Union $622,216 5.00% Promissory Note due December, 1996 secured by 70 1994 tractors 7. Company ABN-Amro $1,666,665 6.40% Promissory Note due July, 1998 secured by 76 1994 tractors 8. Company First Union $30,000,000 Revolving Credit Agreement (approximately $26,500,000 to be paid down at closing) 9. Company Lease Plan, Inc. $27,617 6.63% Installment Note due August, 1996, which, together with Item 10, is secured by 13 tractors and 29 forklifts 10. Company Lease Plan, Inc. $36,855 6.63% Installment Note due November, 1996, which, together with Item 9, is secured by 13 tractors and 29 forklifts
SCHEDULE 5.15 (to Note Purchase Agreement) SCHEDULE 10.4 EXISTING LIENS Liens described in and securing Debt of the Company referred to in Items 1, 2, 4, 5, 6, 7, 9 and 10 of Schedule 5.15. SCHEDULE 10.4 (to Note Purchase Agreement) [FORM OF 2002 NOTES] OLD DOMINION FREIGHT LINE, INC. 7.30% SENIOR NOTE DUE December 15, 2002 No. [_________] [Date] $[____________] PPN 679580 A* 1 FOR VALUE RECEIVED, the undersigned, OLD DOMINION FREIGHT LINE, INC. (herein called the "COMPANY"), a corporation organized and existing under the laws of the Commonwealth of Virginia, hereby promises to pay to [________________], or registered assigns, the principal sum of [________________] DOLLARS on December 15, 2002, with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at the rate of 7.30% per annum from the date hereof, payable semiannually, on the fifteenth day of June and December in each year, commencing with the June 15 or December 15 next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law on any overdue payment (including any overdue prepayment) of principal, any overdue payment of interest and any overdue payment of any Make-Whole Amount (as defined in the Note Purchase Agreements referred to below), payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate per annum from time to time equal to the greater of (i) 9.30% or (ii) 2% over the rate of interest publicly announced by Citibank, N.A. from time to time in New York, New York as its "base" or "prime" rate. Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at the principal office of the Company in High Point, North Carolina or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreements referred to below. This Note is one of a series of Senior Notes (herein called the "NOTES") issued pursuant to separate Note Purchase Agreements, dated as of June 15, 1996 (as from time to time amended, the "NOTE PURCHASE Agreements"), between the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have agreed to the confidentiality provisions set forth in Section 20 of the Note Purchase Agreements and (ii) to have made the representation set forth in Section 6.2 of the Note Purchase Agreements. This Note is a registered Note and, as provided in the Note Purchase Agreements, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder's attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the EXHIBIT 1-A (to Note Purchase Agreement) purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary. The Company will make required prepayments of principal on the dates and in the amounts specified in the Note Purchase Agreements. This Note is also subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreements, but not otherwise. If an Event of Default, as defined in the Note Purchase Agreements, occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreements. This Note shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the law of the State of New York excluding choice-of-law principles of the law of such State that would require the application of the laws of a jurisdiction other than such State. OLD DOMINION FREIGHT LINE, INC. By Its 1-A-2 [FORM OF 2006 NOTES] OLD DOMINION FREIGHT LINE, INC. 7.59% SENIOR NOTE DUE June 15, 2006 No. [_________] [Date] $[____________] PPN 679580 A@ 9 FOR VALUE RECEIVED, the undersigned, OLD DOMINION FREIGHT LINE, INC. (herein called the "COMPANY"), a corporation organized and existing under the laws of the Commonwealth of Virginia, hereby promises to pay to [________________], or registered assigns, the principal sum of [________________] DOLLARS on June 15, 2006, with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at the rate of 7.59% per annum from the date hereof, payable semiannually, on the fifteenth day of June and December in each year, commencing with the June 15 or December 15 next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law on any overdue payment (including any overdue prepayment) of principal, any overdue payment of interest and any overdue payment of any Make-Whole Amount (as defined in the Note Purchase Agreements referred to below), payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate per annum from time to time equal to the greater of (i) 9.59% or (ii) 2% over the rate of interest publicly announced by Citibank, N.A. from time to time in New York, New York as its "base" or "prime" rate. Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at the principal office of the Company in High Point, North Carolina or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreements referred to below. This Note is one of a series of Senior Notes (herein called the "NOTES") issued pursuant to separate Note Purchase Agreements, dated as of June 15, 1996 (as from time to time amended, the "NOTE PURCHASE Agreements"), between the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have agreed to the confidentiality provisions set forth in Section 20 of the Note Purchase Agreements and (ii) to have made the representation set forth in Section 6.2 of the Note Purchase Agreements. This Note is a registered Note and, as provided in the Note Purchase Agreements, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder's attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the EXHIBIT 1-B (to Note Purchase Agreement) purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary. The Company will make required prepayments of principal on the dates and in the amounts specified in the Note Purchase Agreements. This Note is also subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreements, but not otherwise. If an Event of Default, as defined in the Note Purchase Agreements, occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreements. This Note shall be construed and enforced in accordance with, and the rights of the parties shall be governed by the law of the State of New York excluding choice-of-law principles of the law of such State that would require the application of the laws of a jurisdiction other than such State. OLD DOMINION FREIGHT LINE, INC. By Its 1-B-2 DESCRIPTION OF CLOSING OPINION OF COUNSEL TO THE COMPANY The closing opinion of Womble Carlyle Sandridge & Rice, PLLC, special counsel to the Company, which is called for by Section 4.4(a) of the Note Purchase Agreements, shall be dated the date of the Closing and addressed to the Purchasers, shall be satisfactory in scope and form to the Purchasers and shall be to the effect that: 1. The Company is a corporation, duly incorporated, validly existing and in good standing under the laws of the Commonwealth of Virginia, has the corporate power and the corporate authority to execute and perform the Note Purchase Agreements and to issue the Notes and has the full corporate power and the corporate authority to conduct the activities in which it is now engaged and is duly licensed or qualified and is in good standing as a foreign corporation in each jurisdiction in which the character of the properties owned or leased by it or the nature of the business transacted by it makes such licensing or qualification necessary. 2. Each Subsidiary is a corporation duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation and is duly licensed or qualified and is in good standing in each jurisdiction in which the character of the properties owned or leased by it or the nature of the business transacted by it makes such licensing or qualification necessary and all of the issued and outstanding shares of capital stock of each such Subsidiary have been duly issued, are fully paid and nonassessable and are owned by the Company, by one or more Subsidiaries, or by the Company and one or more Subsidiaries. 3. Each Note Purchase Agreement has been duly authorized by all necessary corporate action on the part of the Company, has been duly executed and delivered by the Company and constitutes the legal, valid and binding contract of the Company enforceable in accordance with its terms, subject to bankruptcy, insolvency, fraudulent conveyance or similar laws affecting creditors' rights generally, and general principles of equity (regardless of whether the application of such principles is considered in a proceeding in equity or at law). 4. The Notes have been duly authorized by all necessary corporate action on the part of the Company, have been duly executed and delivered by the Company and constitute the legal, valid and binding obligations of the Company enforceable in accordance with their terms, subject to bankruptcy, insolvency, fraudulent conveyance or similar laws affecting creditors' rights generally, and general principles of equity (regardless of whether the application of such principles is considered in a proceeding in equity or at law). 5. No approval, consent or withholding of objection on the part of, or filing, registration or qualification with, any governmental body, Federal, state or local, is EXHIBIT 4.4(a) (to Note Purchase Agreement) necessary in connection with the execution, delivery and performance of the Note Purchase Agreements or the Notes. 6. The issuance and sale of the Notes and the execution, delivery and performance by the Company of the Note Purchase Agreements do not conflict with or result in any breach of any of the provisions of or constitute a default under or result in the creation or imposition of any Lien upon any of the property of the Company pursuant to the provisions of the Articles of Incorporation or By-laws of the Company or any agreement or other instrument known to such counsel to which the Company is a party or by which the Company may be bound. 7. The issuance, sale and delivery of the Notes under the circumstances contemplated by the Note Purchase Agreements do not, under existing law, require the registration of the Notes under the Securities Act of 1933, as amended, or the qualification of an indenture under the Trust Indenture Act of 1939, as amended. 8. The issuance of the Notes and the use of the proceeds of the sale of the Notes in accordance with the provisions of and contemplated by the Note Purchase Agreements do not violate or conflict with Regulations G, T, U or X of the Board of Governors of the Federal Reserve System. 9. There is no litigation pending or, to the best knowledge of such counsel, threatened which in such counsel's opinion could reasonably be expected to have a materially adverse effect on the Company's business or assets or which would impair the ability of the Company to issue and deliver the Notes or to comply with the provisions of the Note Purchase Agreements. The opinion of Womble Carlyle Sandridge & Rice, PLLC shall cover such other matters relating to the sale of the Notes as the Purchasers may reasonably request. With respect to matters of fact on which such opinion is based, such counsel shall be entitled to rely on appropriate certificates of public officials and officers of the Company. 4.4(a)-2 DESCRIPTION OF CLOSING OPINION OF SPECIAL COUNSEL TO THE PURCHASERS The closing opinion of Chapman and Cutler, special counsel to the Purchasers called for by Section 4.4(b) of the Note Purchase Agreements, shall be dated the date of the Closing and addressed to the Purchasers, shall be satisfactory in form and substance to the Purchasers and shall be to the effect that: 1. The Company is a corporation, validly existing and in good standing under the laws of the Commonwealth of Virginia and has the corporate power and the corporate authority to execute and deliver the Note Purchase Agreements and to issue the Notes. 2. Each Note Purchase Agreement has been duly authorized by all necessary corporate action on the part of the Company, have been duly executed and delivered by the Company and constitute the legal, valid and binding contracts of the Company enforceable in accordance with their terms, subject to bankruptcy, insolvency, fraudulent conveyance or similar laws affecting creditors' rights generally, and general principles of equity (regardless of whether the application of such principles is considered in a proceeding in equity or at law). 3. The Notes have been duly authorized by all necessary corporate action on the part of the Company, have been duly executed and delivered by the Company and constitute the legal, valid and binding obligations of the Company enforceable in accordance with their terms, subject to bankruptcy, insolvency, fraudulent conveyance or similar laws affecting creditors' rights generally, and general principles of equity (regardless of whether the application of such principles is considered in a proceeding in equity or at law). 4. The issuance, sale and delivery of the Notes under the circumstances contemplated by the Note Purchase Agreements does not, under existing law, require the registration of the Notes under the Securities Act of 1933, as amended, or the qualification of an indenture under the Trust Indenture Act of 1939, as amended. The opinion of Chapman and Cutler shall also state that the opinion of Womble Carlyle Sandridge & Rice, PLLC is satisfactory in scope and form to Chapman and Cutler and that, in their opinion, you are justified in relying thereon. In rendering the opinion set forth in paragraph 1 above, Chapman and Cutler may rely solely upon an examination of the Articles of Incorporation certified by and a certificate of good standing of the Company from, the Secretary of State of the Commonwealth of Virginia and the By-laws of the Company. The opinion of Chapman and Cutler is limited to the laws of the State of New York and the Federal laws of the United States. With respect to matters of fact upon which such opinion is based, Chapman and Cutler may rely on appropriate certificates of public officials and officers of the Company. EXHIBIT 4.4(b) (to Note Purchase Agreement) TO: New York Life Insurance and Annuity Corporation FROM: Old Dominion Freight Line, Inc. DATE: June __. 1996 RE: $20,000,000 Senior Notes Due 2006 of Old Dominion Freight Line, Inc. LEGALITY CERTIFICATE Section 1308(2) Delaware Insurance Code (000's omitted) Indicate basis used: Consolidated
For Fiscal Years Ended December 31, 1991 1992 1993 1994 1995 TOTAL 1. Net Income Available for Dividends.......... 2. Add: Federal and State and Other Income Taxes of Parent (and of ___% or more owned subsidiaries if computed on consolidated basis) Extraordinary Non-Recurring Items of Expenses(a)......... 3. Sub-Total (1 plus 2)........................ [See Exhibit A Attached Hereto] 4. Deduct: Extraordinary Non-Recurring Items of Income(a)............................. 5. Adjust Net Income (3 minus 4)............... 6. Add Fixed Charges: Interest on Funded and Unfunded Debt.................................... Amortization of Debt Discount............ Rental for Leased Properties(b).......... Preferred Dividends of Subsidiaries Payable to Others(c).................... 7. Net Earnings Available for Fixed Charged (5 plus 6).................................. 8. Fixed Charges Times Earned (7 divided by 6)...........................
OLD DOMINION FREIGHT LINE, INC. By Its - -------- a Include only those appearing in regular statements; state nature of items and amounts. b Include all payments (whether or not stated to be "rentals") required to be made by lessee, such as taxes, insurance premiums, etc. c Not applicable to company only basis EXHIBIT 4.5 (to Note Purchase Agreement) EX-4 5 EXHIBIT 4.5.1 Exhibit 4.5.1 [FORM OF 2002 NOTES] OLD DOMINION FREIGHT LINE, INC. 7.30% SENIOR NOTE DUE DECEMBER 15, 2002 No. [_________] [Date] $[____________] PPN 679580 A*1 FOR VALUE RECEIVED, the undersigned, OLD DOMINION FREIGHT LINE, INC. (herein called the "COMPANY"), a corporation organized and existing under the laws of the Commonwealth of Virginia, hereby promises to pay to [________________], or registered assigns, the principal sum of [________________] DOLLARS on December 15, 2002, with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at the rate of 7.30% per annum from the date hereof, payable semiannually, on the fifteenth day of June and December in each year, commencing with the June 15 or December 15 next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law on any overdue payment (including any overdue prepayment) of principal, any overdue payment of interest and any overdue payment of any Make-Whole Amount (as defined in the Note Purchase Agreements referred to below), payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate per annum from time to time equal to the greater of (i) 9.30% or (ii) 2% over the rate of interest publicly announced by Citibank, N.A. from time to time in New York, New York as its "base" or "prime" rate. Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at the principal office of the Company in High Point, North Carolina or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreements referred to below. This Note is one of a series of Senior Notes (herein called the "NOTES") issued pursuant to separate Note Purchase Agreements, dated as of June 15, 1996 (as from time to time amended, the "NOTE PURCHASE Agreements"), between the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have agreed to the confidentiality provisions set forth in Section 20 of the Note Purchase Agreements and (ii) to have made the representation set forth in Section 6.2 of the Note Purchase Agreements. This Note is a registered Note and, as provided in the Note Purchase Agreements, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder's attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary. The Company will make required prepayments of principal on the dates and in the amounts specified in the Note Purchase Agreements. This Note is also subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreements, but not otherwise. If an Event of Default, as defined in the Note Purchase Agreements, occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreements. This Note shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the law of the State of New York excluding choice-of-law principles of the law of such State that would require the application of the laws of a jurisdiction other than such State. Old Dominion Freight Line, Inc. By Its [FORM OF 2006 NOTES] OLD DOMINION FREIGHT LINE, INC. 7.59% SENIOR NOTE DUE JUNE 15, 2006 No. [_________] [Date] $[____________] PPN 679580 A@ 9 FOR VALUE RECEIVED, the undersigned, OLD DOMINION FREIGHT LINE, INC. (herein called the "COMPANY"), a corporation organized and existing under the laws of the Commonwealth of Virginia, hereby promises to pay to [________________], or registered assigns, the principal sum of [________________] DOLLARS on June 15, 2006, with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at the rate of 7.59% per annum from the date hereof, payable semiannually, on the fifteenth day of June and December in each year, commencing with the June 15 or December 15 next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law on any overdue payment (including any overdue prepayment) of principal, any overdue payment of interest and any overdue payment of any Make-Whole Amount (as defined in the Note Purchase Agreements referred to below), payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate per annum from time to time equal to the greater of (i) 9.59% or (ii) 2% over the rate of interest publicly announced by Citibank, N.A. from time to time in New York, New York as its "base" or "prime" rate. Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at the principal office of the Company in High Point, North Carolina or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreements referred to below. This Note is one of a series of Senior Notes (herein called the "NOTES") issued pursuant to separate Note Purchase Agreements, dated as of June 15, 1996 (as from time to time amended, the "NOTE PURCHASE Agreements"), between the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have agreed to the confidentiality provisions set forth in Section 20 of the Note Purchase Agreements and (ii) to have made the representation set forth in Section 6.2 of the Note Purchase Agreements. This Note is a registered Note and, as provided in the Note Purchase Agreements, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder's attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary. The Company will make required prepayments of principal on the dates and in the amounts specified in the Note Purchase Agreements. This Note is also subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreements, but not otherwise. If an Event of Default, as defined in the Note Purchase Agreements, occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreements. This Note shall be construed and enforced in accordance with, and the rights of the parties shall be governed by the law of the State of New York excluding choice-of-law principles of the law of such State that would require the application of the laws of a jurisdiction other than such State. OLD DOMINION FREIGHT LINE, INC. By Its EX-27 6 EXHIBIT 27
5 3-MOS 6-MOS DEC-31-1996 DEC-31-1996 JAN-01-1996 JAN-01-1996 MAR-31-1996 JUN-30-1996 1,229 4,027 0 0 44,640 4,600 (5,260) (5,309) 3,758 4,085 51,109 56,002 159,429 172,148 (64,043) (67,856) 151,841 165,299 38,684 35,105 0 0 0 0 0 0 835 835 68,606 70,249 151,841 165,299 68,262 143,124 68,262 143,124 0 0 66,566 138,035 90 184 0 0 546 1,195 1,060 3,710 403 1,410 657 2,300 0 0 0 0 0 0 657 2,300 .08 .28 .08 .28
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