THIRD MODIFICATION OF LOAN AND SECURITY AGREEMENT
Modification made as of July 1, 1995 between XXXX CARGO SYSTEMS, INC.
("Xxxx Cargo"), ("Borrower") and PNC BANK, NATIONAL ASSOCIATION (successor in
interest to BANK LEUMI LE-ISRAEL, B.M.) ("Bank").
BACKGROUND
A. Borrower and Bank are party to a Loan and Security Agreement dated
as of August 8, 1989 (as amended December 20, 1989, November 13, 1992, and as of
December 31, 1992, the ("Loan Agreement") pursuant to which Bank, inter alia,
(i) extended a line of credit in favor of Borrower in the maximum amount of
$3,500,000 ("Line of Credit"), (ii) issued letters of credit for the account of
Borrower and Xxxx Hauling and Warehousing System, Inc. ("Xxxx Hauling"), and
(iii) extended a real estate (term) loan in the original principal amount of
$3,500,000 ("Real Estate Loan").
B. Borrower and Bank now wish to further modify the Loan Agreement to
extend the term of the Line of Credit and the Real Estate Loan and to amend
certain covenants and conditions set forth in the Loan Agreement, all of which
Bank has agreed to do on the terms and conditions set forth in this
Modification.
C. All capitalized terms used but not defined in this Modification
shall have the meaning given to such terms in the Loan Agreement.
AGREEMENTS
Borrower and Bank, intending to be legally bound, agree as follows:
1. Amendments to Loan Agreement.
(a) Effective as of December 31, 1994:
(i) The definition of the term "Real Estate Note" shall be
amended by adding the following phrase thereto: ", as the same may be amended,
substituted, extended or replaced from time to time."
(ii) Section 2.6.2. of the Loan Agreement (added by the
December 20, 1989 modification) is deleted and the following substituted in its
place:
"2.6.2. Maturity/Repayment Schedule. The Real Estate Loan
shall be repaid as follows:
2.6.2.1. Interest shall be payable in arrears at the
interest rate provided in paragraph 2.6.1 hereof on the
outstanding principal balance of the Real Estate Loan,
commencing January 1, 1995 and on the first day of each month
thereafter until the entire principal balance of the Real
Estate Loan shall have been paid in full; and
2.6.2.2. Principal shall be payable in six (6) equal
consecutive monthly installments of $38,888.88 each
commencing July 1, 1995 and payable on the first day of each
month thereafter through and including December 1, 1995.
Thereafter, principal shall be payable in 48 equal
consecutive monthly installments of $19,444.44 each,
commencing January 1, 1996 and on the first day of each month
thereafter through and including December 1, 1999. A final
installment of the entire unpaid balance of principal and the
accrued and unpaid interest due thereon, as well as any other
sums due
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under or with respect to the Real Estate Loan, shall be
payable on December 31, 1999."
(b) Effective as of the date hereof:
(i) Xxxxxx Marine Services, Inc. shall be added to the
definition of the term "Corporate Guarantor".
(ii) Sections 6.1.12.1, 6.1.12.2 and 6.1.12.5 of the Loan
Agreement are deleted in their entirety and the following substituted in their
place:
"16.1.12.1. Maintain a ratio of Debt to Tangible Net
Worth of not more than 3.0 to 1 as of December 31, 1994 and
as of each fiscal quarter thereafter.
6.1.12.2. Maintain Tangible Net Worth of not less than
$41,000,000 as of December 31, 1994 and as of each fiscal
quarter thereafter.
6.1.12.5. Maintain a ratio of (A) net income after
taxes, plus depreciation to (B) current maturities of long
term debt (excluding the outstanding principal balance of
amounts due to Meridian Bank under that certain Loan
Agreement dated October 19, 1994 between, inter alia,
Borrower and Meridian Bank) for the immediately prior fiscal
year, plus current maturities of Capital Lease obligations
for the immediately prior fiscal year, plus capital
expenditures for the fiscal year, less in each case, balloon
payments classified as current liabilities, of not less than
1.0 to 1 as of December 31, 1994 and as of each December 31
thereafter."
(iii) A new Section 7.1.2.6 is added to the Loan
Agreement and shall read as follows:
"7.1.2.6. Sell, lease, assign or otherwise dispose of
and shall not permit any Corporate Guarantor to sell, lease,
assign or otherwise dispose of, in any fiscal year any
assets valued in the aggregate in excess of 10% of the
Combined total assets of Borrower and Corporate Guarantors;
provided, however,
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Bank shall not unreasonably withhold its consent to any
sale, lease, assignment or other disposition in excess of
the amounts set forth herein."
(c) Effective as of May 31, 1995, the "Termination Date" of the
Line of Credit shall be extended to May 31, 1996.
(d) The following phrase shall be added to the end of Section
7.1.1.1. of the Loan Agreement:
"...provided, however, the foregoing restriction shall only
apply (a) while there shall be any amounts available to be
drawn under the Initial Letter of Credit and/or the Second
Letter of Credit or Borrower and/or Xxxx Hauling shall have
any obligation to Bank in connection therewith, and/or (b)
while Borrower shall have any obligation to Bank in
connection with the Cash Line and/or the Cash Line shall not
have been terminated, regardless of whether any amounts
shall be outstanding thereunder."
(e) Section 8.1.4. of the Loan Agreement is deleted in its
entirety and the following substituted in its place;
"8.1.4. So long as (a) there shall be any amounts
available to be drawn under the Initial Letter of Credit
and/or on the Second Letter of Credit or Borrower and/or
Xxxx Hauling shall have any obligation to Bank in connection
therewith, and/or (b) Borrower shall have any obligation to
Bank in connection with the Cash Line and/or the Cash Line
shall not have been terminated, regardless of whether any
amounts shall be outstanding thereunder, failure of Borrower
to timely and completely perform and comply with each of the
covenants set forth in Paragraph 6.1.12 hereof."
(f) The following sentence shall be added to the end of Section
8.1.3. of the Loan Agreement:
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"Borrower shall provide Bank with written notice of any
such default by Borrower within three (3) days after the
occurrence thereof."
2. Conditions Precedent. The obligation of Bank to effect the
modifications contained in this Modification is subject to the condition
precedent that Bank shall have received all of the following documents,
each of which shall be in form and substance satisfactory to Bank:
(a) An agreement by which Xxxxxx Marine Services, Inc.
("Xxxxxx") and Wilmington Stevedores, Inc. ("Wilmington") each becomes surety
for all liabilities of Borrower and Xxxx Hauling to Bank ("New Surety
Agreements").
(b) Modification of the Real Estate Note reflecting the
extension and modification of the terms thereof as set forth herein ("Note
Modification").
(c) Copies of resolutions of the boards of directors of Borrower
and Corporate Guarantors authorizing the execution, delivery and performance of
this Modification and all other documents and instruments required hereby
(including without limitation the Note Modification and the New Surety
Agreements), certified by the secretary or an assistant secretary of Borrower or
Corporate Guarantors, as the case may be.
(d) A written certificate of the secretary or an assistant
secretary of Borrower and Corporate Guarantors as to the names and true
signatures of the officers of Borrower and Corporate Guarantors, as the case may
be, authorized to sign this Modification and all other documents and instruments
required
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hereby (including without limitation the Note Modification and the New Surety
Agreements).
(e) Certified copies of the Articles of Incorporation and
By-laws of Xxxxxx and Wilmington, together with evidence that the Articles of
Incorporation and By-laws of Borrower and the other Corporate Guarantors have
not been modified or amended (or if so, the nature and extent thereof) since
December 31, 1992 and are in full force and effect.
(f) Good Standing certificates (dated not more than 15 days
prior to the date hereof) for each of Borrower, Xxxx Hauling, Xxxxxx, Wilmington
and Broadway Equipment Leasing Corp.
(g) Title search, to be obtained at Borrower's sole cost and
expense, of the property subject to the 1984 Mortgage and 1989 Mortgage
indicating no liens or encumbrances except as may appear in Chicago Title
Insurance Company's Mortgagee Title Policy No. 31-0041-02- 006389.
(h) Updated appraisal of the property covered by the 1984
Mortgage and the 1989 Mortgage prepared by an appraiser and on terms
satisfactory to Bank showing an appraised value in an amount satisfactory to
Bank.
(i) A favorable opinion of counsel to Borrower and Affiliates as
to the matters mentioned in Paragraphs 3(a), (b) and (c) herein.
(j) Such other documents or instruments as Bank may have
requested under the terms of this Modification or otherwise.
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3. Representations and Warranties. In order to induce Bank to enter
into this Modification, Borrower represents and warrants to Bank as follows:
(a) The execution, delivery and performance by Borrower and
Corporate Guarantors of this Modification and any other documents and
instruments required by Bank for the implementation of this Modification
(including without limitation the Note Modification and the New Surety
Agreements) have been duly authorized by all necessary corporate action and do
not and will not violate any provision of law or of the charter or by-laws of
Borrower or any Corporate Guarantor or any agreement, trust or other indenture
or instrument to which Borrower or any Guarantor is a party, or by which any of
its or their properties may be bound or affected; provided, however, that this
representation does not apply to Xxxx Cargo Systems of California, Inc., Xxxx
Warehousing Company, Marine Information Technology, Inc. or T&L Leasing Corp.
(b) This Modification constitutes and the other documents and
instruments required hereby (including without limitation the Note Modification
and the New Surety Agreements) when executed and delivered will constitute the
legal, valid and binding obligations of Borrower and Guarantors, enforceable in
accordance with their terms; provided, however, that this representation does
not apply to Xxxx Cargo Systems of California, Inc., Xxxx Warehousing Company,
Marine Information Technology, Inc. or T&L Leasing Corp.
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(c) No authorization, consent, approval, license, exemption or
any other action by and no registration, qualification or filing with any
governmental agency or authority is or will be necessary in connection with the
execution, delivery and performance of this Modification or the other documents
and instruments required hereby (including without limitation the Note
Modification and the New Surety Agreements).
(d) The Combined balance sheet and profit and loss and surplus
statements of Borrower and Corporate Guarantors as of December 31, 1994,
certified by B.D.O. Xxxxxxx, and the Combined balance sheet and profit and loss
and surplus statements of Borrower and Corporate Guarantors as of March 31,
1995, prepared by Borrower copies of all of which have been furnished to Bank,
are complete and correct, show all material liabilities, direct and contingent,
and present fairly the financial position, the results of operations and charges
in Combined financial position of Borrower and Corporate Guarantors at such
dates and for the period ended on such dates, all in accordance with generally
accepted accounting principals consistently applied. Since March 31, 1995, there
has been no material adverse change in such financial position or such results
of operations.
(e) On and as of the date of this Modification, there has
occurred no Event of Default and no event which with notice or lapse of time or
both would, if unremedied, be an Event of Default.
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(f) Except with respect to the good standing of Xxxx Cargo
Systems of California, Inc., Xxxx Warehousing Company, Marine Information
Technology, Inc., and T & L Leasing Corp., the representations and warranties
made by Borrower to Bank in the Loan Agreement are true and correct as though
made on and as of the date of this Modification.
(g) The Loan Agreement is in full force and effect. As of the
date of this Modification, the principal amount due under the Cash Note is
$3,500,000, and the principal amount due under the Real Estate Note is
$2,352,778.04. All interest under the Cash Note and the Real Estate Note has
been paid in full through May 31, 1995. Borrower has no defense, set-off or
counterclaim to its performance under the Loan Agreement, Cash Note, Real Estate
Note, or any document or instrument executed in connection with any of the
foregoing.
4. Release. In consideration for Bank's agreement to consent to the
modifications set forth herein, Borrower hereby waives and releases and forever
discharges Bank and its officers, directors, attorneys, agents, and employees
from any liability, damage, claim, loss or expense of any kind that they may
have now or hereafter against Bank or any of them arising out of or relating to
the Indebtedness. Borrower further states that it has carefully read the
foregoing release, knows the contents thereof and grants the same as its own
free act and deed.
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5. Miscellaneous.
(a) This Modification shall be deemed, to the extent
inconsistent therewith, a modification of the Loan Agreement and all other
instruments and documents executed by Borrower in connection with the Loan
Agreement (the "Collateral Documents"). Subject to the foregoing, the terms and
conditions of the Loan Agreement and the Collateral Documents are ratified and
confirmed, shall remain in full force and effect and Borrower acknowledges and
agrees that the same shall secure all of Borrower's liabilities to Bank under
the Loan Agreement.
(b) This Modification shall be governed by and construed in
accordance with the law of the Commonwealth of Pennsylvania.
(c) Borrower shall pay on demand all costs and expenses of Bank
in connection with the preparation, execution, delivery, administration and
enforcement of this Modification and the other documents and instruments
required hereby (including the fees and out of pocket costs of counsel with
respect thereto). The agreement set forth in this paragraph 5(c) shall survive
the repayment of the Loans and the cancellation or expiration of the Initial
Letter of Credit and the Second Letter of Credit.
(d) Paragraph headings used in this Modification are for
convenience only and shall not affect the construction of this modification.
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IN WITNESS WHEREOF, the parties hereto have executed this Modification
as of the date written above.
Attest: XXXX CARGO SYSTEMS, INC.
/s/ Xxxx Xxxxx By: /s/ Xxxxxxx Xxxxxx
----------------------------- -------------------------------
Vice President
PNC BANK, NATIONAL ASSOCIATION
By: /s/ Xxxxxxx X.
------------------------------
Vice President
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CONSENT
Each of the undersigned, surety for all obligations of Borrower to Bank
pursuant to its Surety Agreement dated August 8, 1989 and November 13, 1992,
and, as to Xxxxxx Marine Services, Inc. ("Xxxxxx") and Wilmington Stevedores,
Inc. ("Wilmington") as of the date hereof, hereby consents to the foregoing
Modification and the other documents and instruments referred to therein, joins
in and consents to the Release set forth in Paragraph 4 above as if set forth at
length herein, and ratifies, affirms and agrees that its Surety Agreement shall
continue in full force and effect.
In addition to the foregoing, in order to induce Bank to enter into the
foregoing Modification, Xxxxxx and Wilmington each represents, warrants and
agrees, with the intent to be legally bound:
1. All of the representations and warranties in the Loan Agreement
applicable to it as a Corporate Guarantor are true and correct as if made by it.
2. It shall comply fully with all covenants contained in the Loan
Agreement applicable to it as a Corporate Guarantor as if it were a party to the
Loan Agreement.
IN WITNESS WHEREOF, the undersigned have executed this Consent as of
July 1, 1995.
Witness:
/s/ Xxxx Xxxxx /s/ Xxxxxx X. Xxxx
----------------------------- ---------------------------------------
XXXXXX X. XXXX
XXXX HAULING AND WAREHOUSING SYSTEM, INC.
BROADWAY EQUIPMENT LEASING CORP.
REFRIGERATED DISTRIBUTION CENTER, INC.
OREGON AVENUE ENTERPRISES, INCORPORATED
XXXXXXXX AVENUE WAREHOUSING CORP.
XXXXXX XXXXX ICE, INC.
XXXX CARGO SYSTEMS OF CALIFORNIA
THE RIVERFRONT DEVELOPMENT CORPORATION
000 XXXXXXXX XXXXXX, INC.
XXXX WAREHOUSING COMPANY
MARINE INFORMATION TECHNOLOGY, INC.
X.X. XXXXXXXX & CO., INC.
T. & L. LEASING CORP.
CRT, INC.
REFRIGERATED ENTERPRISES, INC.
DOCKSIDE INTERNATIONAL FISH CO., INC.
XXXXXX MARINE SERVICES, INC.
WILMINGTON STEVEDORES, INC.
Attest:
/s/ Xxxx Xxxxx By (as to all): /s/ Xxxxxxx Xxxxxx
----------------------------- -----------------------
Vice President
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XXXXX XX XXX XXXXXX :
: SS
COUNTY OF CAMDEN :
On this 31st day of July, 1995, before me, a Notary Public, personally
appeared Xxxxxx X. Xxxx, who acknowledged himself to be the person who executed
the foregoing Consent dated as of July 1, 1995, for the purposes therein
contained.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal.
/s/ Xxxxxxx X. Xxxxxxxx
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Notary Public
XXXXXXX X XXXXXXXX
NOTARY PUBLIC - STATE OF NEW JERSEY
My Commission Expires May 30, 0000
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XXXXX XX XXX XXXXXX :
: SS
COUNTY OF CAMDEN :
On this 31st day of July, 1995, before me, a Notary Public, personally
appeared Xxxxxxx Xxxxxx, who acknowledged himself to be the vice president of
Xxxx Cargo Systems, Inc., Xxxx Hauling and Warehousing System, Inc., Broadway
Equipment Leasing Corp., Refrigerated Distribution Center, Inc., Oregon-Avenue
Enterprises, Inc., Xxxxxxxx Avenue Warehousing Corp., Xxxxxx Xxxxx Ice, Inc.,
Xxxx Cargo Systems of California, Riverfront Development Corporation, 000
Xxxxxxxx Xxxxxx, Xxx., Xxxx Warehousing Company, Marine Information Technology,
Inc., X.X. Xxxxxxxx & Co., Inc., T. & L. Leasing Corp., CRT, Inc., Refrigerated
Enterprises, Inc., Dockside International Fish Co., Inc., Xxxxxx Marine
Services, Inc., and Wilmington Stevedores, Inc. corporations, and that he as
such officer being authorized to do so, executed the foregoing document dated as
of July 1, 1995 for the purposes therein contained by signing the name of the
corporations by himself as such officer.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal.
/s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Notary Public
XXXXXXX X XXXXXXXX
NOTARY PUBLIC - STATE OF NEW JERSEY
My Commission Expires May 30, 2000
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