1
Exhibit 10.33
LOAN AGREEMENT
DATED AS OF AUGUST 15, 1994
BETWEEN
MESA HOLDING CO.
AND
SUPERSHUTTLE INTERNATIONAL, INC.
2
TABLE OF CONTENTS
PAGE
ARTICLE I - DEFINITIONS AND ACCOUNTING TERMS .......................... 1
1.1 Certain Defined Terms ................................... 1
1.2 Computation of Time Periods ............................. 7
1.3 Accounting Terms ........................................ 7
ARTICLE II - AMOUNTS AND TERMS OF THE LOANS ........................... 7
2.1 The NGV Loan ............................................ 7
2.2 The Bridge Loan ......................................... 7
2.3 Principal and Interest .................................. 8
2.4 Prepayments ............................................. 8
2.5 Payments and Computations ............................... 9
ARTICLE III - CONDITIONS OF LENDING ................................... 9
3.1 Condition Precedent to the Bridge Loan .................. 9
3.2 Condition Precedent to the Initial NGV Loan ............. 11
3.3 Conditions Precedent to Subsequent NGV Loans ............ 12
ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF SSI ..................... 13
4.1 Organization and Qualification; Subsidiaries ............ 13
4.2 Power and Authority ..................................... 13
4.3 Enforceability .......................................... 13
4.4 Financial Statements .................................... 13
4.5 Default ................................................. 14
4.6 Title to Assets; Liens .................................. 14
4.7 Payment of Taxes ........................................ 14
4.8 Absence of Conflicts .................................... 14
4.9 Compliance with Laws .................................... 14
4.10 Litigation .............................................. 15
4.11 Margin Stock ............................................ 15
4.12 Patents, Etc ............................................ 15
4.13 Employee Benefits ....................................... 15
4.14 Consents, Etc ........................................... 15
4.15 Fiscal Year ............................................. 15
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PAGE
4.16 Location of Assets ..................................... 16
4.17 Subordinated Debt Documents ............................ 16
4.18 Invoices ............................................... 16
4.19 Solvency ............................................... 16
4.20 Information ........................................... 16
ARTICLE V - AFFIRMATIVE COVENANTS .................................. 17
5.1 Information of SSI ..................................... 17
5.2 Books and Records ...................................... 17
5.3 Insurance .............................................. 17
5.4 Loss Payable Endorsements .............................. 17
5.5 Maintenance of Property ................................ 18
5.6 Inspection of Property and Records ..................... 18
5.7 Laws, Obligations ...................................... 18
5.8 Existence .............................................. 18
5.9 Application of Proceeds ................................ 18
5.10 Subsidiary Cash Flows .................................. 19
5.11 Subsidiary Sales ....................................... 19
5.12 Termination Statements ................................. 19
ARTICLE VI - NEGATIVE COVENANTS ....................................... 19
6.1 Capital Expenditures ................................... 19
6.2 Liens .................................................. 19
6.3 Indebtedness ........................................... 20
6.4 Transactions with Affiliates ........................... 20
6.5 Accounts ............................................... 20
6.6 Merger, Consolidation, Sale of Assets, Etc ............. 20
6.7 Investments, Laws, Advances, etc ....................... 21
6.8 Guarantees ............................................. 21
6.9 Dividends, Etc ......................................... 21
6.10 NGV Leases ............................................. 21
ARTICLE VII - EVENTS OF DEFAULT ........................................ 21
7.1 Events of Default ...................................... 21
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PAGE
ARTICLE VIII - MISCELLANEOUS .......................................... 23
8.1 Amendments, Etc ......................................... 23
8.2 Notices, Etc ............................................ 23
8.3 No Waiver, Remedies ..................................... 24
8.4 Costs and Expenses of Enforcement ....................... 25
8.5 Binding Effect .......................................... 25
8.6 Limitation on Agreements ................................ 25
8.7 Severability ............................................ 26
8.8 Governing Law and Consent to Jurisdiction ............... 26
8.9 Execution in Counterparts ............................... 27
8.10 Right to Factor Loan .................................... 27
8.11 Final Agreement ......................................... 27
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INDEX OF EXHIBITS AND SCHEDULES
Exhibit A Promissory Note
Exhibit B Security Agreement
Exhibit C Guaranty
Exhibit D Pledge and Security Agreement
Exhibit E Bridge Promissory Note
Schedule 1. 1 Vehicles to be Converted
Schedule 2.3(a) Principal and Interest
Schedule 6.2(d) Existing Liens
Schedule 6.3(c) Existing Indebtedness
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LOAN AGREEMENT
Dated as of August 15, 1994
SuperShuttle International, Inc., a Delaware corporation
("SSI"), and Mesa Holding Co., a Delaware corporation ("Mesa') hereby agree as
follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1 Certain Defined Terms. As used in this Loan Agreement (the
"Agreement"), the following terms shall have the following meanings (such
meanings to be equally applicable to both the singular and plural forms of the
terms defined):
"Account Debtor" means the Person who is obligated on or under
an Account.
"Accounts" means, with respect to any Person, all present and
future rights, howsoever evidenced, of such Person to payment for goods sold or
leased or for services rendered, and whether or not they have been earned by
performance, including, without limitation, all "accounts" as such term is
defined in the Uniform Commercial Code in effect in any applicable jurisdiction.
"Affiliate" means, with respect to any specified Person, any
other Person that, directly or indirectly, through one or more intermediaries,
controls or is controlled by or is under common control with such specified
Person. For purposes of this definition, "control" means the possession,
directly or indirectly, of the power to direct, or cause the direction, of the
management or policies of a Person, whether through ownership of voting
securities, by contract or otherwise.
"Bridge Loan" has the meaning specified in Section 2.2.
"Bridge Note" has the meaning specified in Section 2.2.
"Business Day" means any day other than Saturday, Sunday and
any other day on which commercial banks are authorized by law to close in the
State of Taxes.
"Capital Expenditures" means, with respect to any Person, any
current expenditures (including, without limitation, any such amounts financed
by entering into a Capital Lease) made by such Person for the acquisition,
construction, repair, maintenance or replacement of fixed or capital assets of
such Person which should, in accordance with GAAP, be capitalized on the balance
sheet of such Person.
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"Capital Lease" means, with respect to any Person, any lease
in respect of which the obligations of such Person as the lessee thereunder
constitute Capitalized Lease Obligations of such Person.
"Capitalized Lease Obligations" means, with respect to any
Person, all lease obligations of such Person which have been or should be
capitalized on the books of such Person in accordance with GAAP.
"Cash Flow" of any person means, for any period, the sum
(without duplication) for such person and its subsidiaries on a consolidated
basis of the following for such period: (i) operating income (loss) before
minority interest and extraordinary items, (ii) depreciation and amortization
expense and (iii) other non-cash items decreasing operating income, less other
non-cash items increasing operating income.
"Dated Invoice" means, with respect to any Account, the
initial invoice relating to such Account which is dated as of the date on which
(i) the goods giving rise to such Account were delivered to the Account Debtor
under such Account, or (ii) the services giving rise to such Account were
rendered to the Account Debtor under such Account.
"Demand Date" means the third Business Day after SSI receives
a written demand from Mesa for payment of the Bridge Note, and shall be a date
no later than the date nine months after the Bridge Loan Date.
"Default" means any event which, with the lapse of time or
giving of notice, or both, would constitute an Event of Default.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
"Events of Default" has the meaning specified in Section 7.1.
"GAAP" means generally accepted accounting principles as in
effect from time to time in the United States of America as set forth in the
opinions and pronouncements -A of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as is approved by a significant segment of the
accounting profession.
"Guarantor" means Wilmington Cab Company of California, a
California corporation and a principal stockholder of SSI.
"Guaranty" means the guaranty of Guarantor of the obligations
of SSI under this Agreement and the Notes, executed pursuant to Section 3.1(a)
of this Agreement and
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substantially in the form attached hereto as Exhibit C, as such Guaranty may be
amended, modified, supplemented, restated or reaffirmed from time to time.
"Highest Lawful Rate" means the maximum nonusurious interest
rate, if any, that at any time or from time to time may be contracted for,
taken. reserved, charged, or received with respect to any Note or on other
amounts, if any, due to Mesa pursuant to this Agreement or any other Loan
Document under laws applicable to Mesa which are presently in effect or, to the
extent allowed by law, under such applicable laws which may hereafter be in
effect and which allow a higher maximum nonusurious interest rate than
applicable laws allow as of the date hereof.
"Indebtedness" means, when used with respect to any Person,
all indebtedness, obligations and liabilities of such Person, contingent or
otherwise, direct or indirect and howsoever evidenced or incurred that should be
reflected as a liability on the balance sheet of such Person prepared in
accordance with GAAP.
"Initial NGV Loan" means the first NGV Loan made hereunder.
"Investment" means any direct or indirect purchase or other
acquisition by SSI of, or beneficial interest in, any marketable direct
obligations, certificates of deposit or time deposits, money market accounts,
commercial paper, stock, instruments, bonds, debentures or other securities or
debt instruments of any other Person or any direct or indirect loan, advance
(other than advances to employees of SSI for moving, travel or payroll expenses
or similar expenditures in the ordinary course of SSI's business) or capital
contribution by SSI to any other Person, including, without limitation, all
Indebtedness of such other Person owing to or guaranteed by SSI or its
subsidiaries and all Accounts owing by such other Person to SSI or its
subsidiaries which did not arise from sales or the rendition of services to such
other Person in the ordinary and usual course of SSI's business. At any time any
determination thereof is to be made, the amount of any Investment shall be the
original cost of such Investment, without any adjustments for appreciation,
non-cash dividends, accretions, increases or decreases in value or write-ups,
write-downs, write-offs or charge-offs to or with respect to such Investment;
provided however, that, in the case of any Investment, the original amount of
such Investment shall be reduced by the amount of any repayments or other cash
distributions made to SSI or its subsidiaries with respect to such Investment.
"JWI Franchisee" means the shuttle business operated at Xxxx
Xxxxx International Airport and the surrounding area pursuant to a franchise
agreement between SSI and Preferred Transportation, Inc., a California
corporation.
"LAX Franchisee" means the shuttle business operated at Los
Angeles International Airport and the surrounding area pursuant to a franchise
agreement between SSI and SuperShuttle of Los Angeles, Inc., a California
corporation.
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"Legal Requirement" means any federal, state, local, foreign
or international law, treaty, ordinance, statute, code, rule or regulation of
any Tribunal or any decision, judgment, order, writ, injunction, decree, award
or determination of any Tribunal.
"Lessees" means, collectively, the LAX Franchisee, the JWI
Franchisee and Phoenix Sub.
"Lien" when used with respect to any Person shall mean any
mortgage, lien, charge, pledge, security interest or encumbrance of any kind
(whether voluntary or involuntary, affirmative or negative, and whether imposed
or created by operation of law or otherwise) upon, or pledge of, any of the
property of such Person, whether such property or assets are now owned or
hereafter acquired and wheresoever located, and any conditional sale agreement,
Capital Lease or other tide retention agreement.
"Loan Documents" means this Agreement, the Notes, the Security
Agreement, the Guaranty, the Pledge Agreement and any other document or
instrument executed in connection with any of the foregoing.
"Loans" means the Bridge Loan and the NGV Loans, collectively.
"Master Agreement" means the Master Agreement, dated as of the
date hereof between Mesa and SSI.
"NGVs" means the 185 1995 Dodge B-250 Ram vans with factory
compressed natural gas option to be purchased by SSI with the proceeds of the
Loan.
"NGV Conversion House" means a facility capable of installing
equipment on (i) the NGVs which SSI deems necessary, in SSI's sole discretion,
for SSI or the Lessees, as applicable, to conduct its or their respective
businesses including additional compressed natural gas tank and shroud with
associated hardware or (ii) certain gasoline-powered fleet vehicles currently
owned and operated by Phoenix Sub indentified on Schedule 1.1 hereto necessary
to convert such vehicles to be capable of operating on compressed natural gas.
"NGV Insurance" means any insurance policy obtained by SSI,
its franchisees, subsidiaries or affiliates covering any of the NGVs.
"NGV Invoice" means any invoice received by SSI from Chrysler
Corporation, an authorized dealer for Chrysler Corporation or a NGV Conversion
House.
"NGV Lease" means each lease agreement pursuant to which SSI
will lease to the LAX Franchisee, the JWI Franchisee and the Phoenix Sub, 80, 65
and 40 NGVs, respectively, substantially in the form attached to the Master
Agreement as Exhibit C.
"NGV Loan" has the meaning specified in Section 2.1.
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"NGV Loan Date" has the meaning specified in Section 2.1.
"NGV Notes" has the meaning specified in Section 2.1.
"Notes" means the NGV Notes and the Bridge Note, collectively.
"Permitted Investments" means (i) marketable direct
obligations issued or unconditionally guaranteed by the United States government
or any agency thereof and backed by the full faith and credit of the United
States of America, in each case maturing within 180 days from the date of
acquisition thereof, (ii) certificates of deposit, repurchase agreements or
bankers' acceptances maturing within 180 days from the date of acquisition
thereof, issued by my bank organized under the laws of the United States of
America or any state thereof or the District of Columbia which is a member of
the Federal Reserve System and has, as of the date of the investment, a short
term deposit rating P-1 or A-1 from Xxxxx'x Investors Service, Inc. or Standard
& Poor's, respectively, and a long term deposit rating of A from Xxxxx'x
Investors Service, Inc. or Standard & Poor's, (iii) any debt instrument with a
maturity of 90 days or less rated A-1 or P-1 by Xxxxx'x Investor Service or
Standard & Poor's, respectively, and (iv) money market funds organized under the
laws of the United States of America or any state thereof that invest solely in
any of the investments permitted under the immediately preceding clauses (i)
through (iii).
"Person" means an individual, partnership, corporation
(including a business trust), limited liability company, joint stock company,
trust, unincorporated association, joint venture or other entity, or a
government or any political subdivision or agency thereof.
"Phoenix Sub" means SuperShuttle Arizona, Inc., an Arizona
corporation and a wholly owned subsidiary of SSI.
"Plan" means, with respect to any Person, an employee benefit
plan of such Person or any Affiliate of such Person subject to ERISA.
"Pledge Agreement" means the Pledge and Security Agreement,
dated as of the date hereof between SSI, as pledgor, and Mesa, as secured party,
executed pursuant to Section 3.1(a) of this Agreement, substantially in the form
attached hereto as Exhibit D, as such Pledge Agreement may be amended, modified,
supplemented, restated or extended from time to time.
"Property" means any interest or right in any kind of property
or asset, whether real, personal, or mixed, owned or leased, tangible or
intangible, and whether now held or hereafter acquired.
"Refueling Agreement" means the Refueling Agreement, dated as
of the date hereof, among Mesa, SSI, the JWI Franchisee, the LAX Franchisee and
the Phoenix Sub, substantially in the form attached to the Master Agreement as
Exhibit B.
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"Reportable Event" shall mean a reportable event as defined by
ERISA.
"Xxxxx" means Xxxxxxxx X. Xxxxx, a principal stockholder and
Chief Executive Officer of SSI.
"Security Agreement" means the Security Agreement, dated as of
the date hereof, between SSI, as debtor, and Mesa, as secured party, executed
pursuant to Section 3.1(a) of this Agreement, substantially in the form attached
hereto as Exhibit B, as such Security Agreement may be amended, modified,
supplemented, restated or extended from time to time.
"Security Documents" means the Security Agreement and the
Pledge Agreement and any other document or instrument executed in connection
with any of the foregoing.
"Stated Maturity Date" means the third anniversary of the date
of each NGV Loan.
"Subordinated Debt" shall mean all Indebtedness of SSI which
is incurred on or after the date hereof with the prior written consent of Mesa
(which Mesa shall have no obligation to give) and which, by the terms of the
instrument evidencing or creating such Indebtedness (which agreements, documents
and instruments shall be satisfactory to Mesa in form and substance), is
validly, effectively and expressly made subordinate and subject in right of
payment, to whatever extent Mesa may require in its sole discretion, to the
prior payment in full, in cash or cash equivalents, of all indebtedness of SSI
in respect of the principal of, and interest on, the Loan and all other
indebtedness and payment obligations of SSI to Mesa under the Loan Documents.
"Subsidiaries" means, collectively, the Phoenix Sub,
SuperShuttle DFW, Inc., a Texas corporation ("SuperShuttle DFW"), SuperShuttle
of San Francisco, Inc, a California corporation ("SuperShuttle San Francisco"),
SuperShuttle Franchise Corporation, a Delaware corporation, and LAX Franchisee,
each of which is a wholly owned subsidiary of SSI.
"Subsidiary Sale" means the completion of the sale of all of
the assets or stock of SuperShuttle San Francisco and/or SuperShuttle DFW.
"Termination Date" means the earlier to occur of (a) the
Stated Maturity Date or (b) any earlier maturity date resulting from
acceleration of the outstanding principal amount of the NGV Loans pursuant to
Section 7.1 hereof.
"Trade Debt" means, with respect to any Person, indebtedness
of such Person incurred in the ordinary course of business to trade creditors of
such Person.
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"Tribunal" means any government, any arbitration panel, any
court or any governmental department, commission, board, bureau, agency or
instrumentality of the United States or any foreign or domestic state, province,
commonwealth, nation, territory, possession, country, parish. town, township,
village or municipality or any non-governmental regulatory body to the extent
that the rules, regulations or orders of such body have the force of law.
"Union Bank Loan" means the loan from Union Bank to SSI the
terms of which were modified by the letter agreement dated May 25, 1994, between
SSI and Union Bank.
1.2 Computation of Time Periods. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
unless otherwise specified herein the word "from" means "from and including" and
the words "to" and "until" each means "to but excluding".
1.3 Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP.
ARTICLE II
AMOUNTS AND TERMS OF THE LOANS
2.1 The NGV Loan. Mesa agrees, on the terms and conditions
hereinafter set forth, to make loam (collectively, the "NGV Loans" and
individually, a "NGV Loan") to SSI from time to time within five business days
of the date that SSI receives an NGV invoice (each such date shall be
hereinafter referred to as a "NGV Loan Date") during the period from the date
hereof until the first anniversary of the date hereof in an aggregate amount not
to exceed $4,500,000, on a senior secured and guaranteed basis. Each NGV Loan
will be evidenced by a promissory note (the "NGV Note"), substantially in the
form attached as Exhibit A hereto, and will be secured by the Security Documents
and will be guaranteed pursuant to the Guaranty. SSI may borrow and prepay
amounts as provided in this Article II, however Borrower shall not have the
right to reborrow any amounts repaid hereunder.
2.2 The Bridge Loan. Mesa agrees, on the terms and conditions
hereinafter set forth, to loan to SSI on a senior secured and guaranteed basis
an aggregate amount (the "Bridge Loan Amount") not to exceed $1,000,000 (the
"Bridge Loan") on the date hereof. The Bridge Loan will be evidenced by a
promissory note (the "Bridge Note"), substantially in the form attached as
Exhibit E hereto, and will be secured by the Security Documents, and will be
guaranteed pursuant to the Guaranty.
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2.3 Principal and Interest.
(a) The NGV Loans. SSI shall repay the unpaid principal
amount outstanding on each NGV Loan, and all accrued and unpaid interest thereon
from the applicable NGV Loan Date until such principal amount shall be paid in
full, at the rate per annum (the "Interest Rate") equal at all times to the
lesser of (i) 12% and (ii) the Highest Lawful Rate. Such principal and interest
shall be payable by SSI to Mesa monthly, on the dates and in the amounts
indicated in Schedule 2.3(a) attached hereto. To the extent permitted by
applicable law, SSI shall pay interest on overdue accrued and unpaid interest at
the Interest Rate. On each Termination Date SSI shall repay the unpaid principal
amount outstanding of the applicable NGV Loan and all accrued and unpaid
interest thereon.
(b) The Bridge Loan. SSI shall repay on the Demand Date,
the unpaid principal amount outstanding on the Bridge Loan, and all accrued and
unpaid interest thereon from the date hereof until such principal amount shall
be paid in full, at the Interest Rate. Interest on the Bridge Loan shall be due
and payable by SSI to Mesa monthly, on the last business day of each month,
commencing on August 31, 1994, with the last payment payable on the Demand Date.
To the extent permitted by applicable law, SSI shall pay interest on overdue
accrued and unpaid interest at the Interest Rate.
2.4 Prepayments.
(a) Optional Prepayments. SSI may, upon at least ten
Business Days' notice to Mesa stating the proposed date (which shall be a
Business Day) and aggregate principal amount of a prepayment, prepay the
outstanding principal amount of the Loans in whole or in part, together with
accrued interest to the date of such prepayment on the principal amount prepaid;
provided however, that all such prepayments shall be made together with accrued
interest to the date of such prepayments on the principal amount prepaid without
premium or penalty thereon. Such notice shall be irrevocable and the payment
amount specified in such notice shall be due and payable on the prepayment date
described in such notice, together with waved and unpaid interest on the amount
prepaid.
(b) Mandatory Prepayments. In the event SSI completes one
or more Subsidiary Sales prior to the Demand Date, SSI shall use the net cash
proceeds received from the first such sale solely to prepay the outstanding
principal amount of the Bridge Loan, in whole or in part, together with accrued
interest to the date of such prepayment on the principal amount prepaid.
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2.5 Payments and Computations.
(a) SSI shall make each payment hereunder and under the
Notes not later than 12:00 Noon (Dallas, Texas time) on the day when due
in U.S. dollars to a bank designated in advance, in writing by Mesa, for
the account of Mesa, in same day funds.
(b) All computations of interest shall be made on the
basis of the actual number of days (including the first day but excluding
the last day) elapsed computed on the basis of a 360-day year consisting
of twelve 30-days months (unless such calculation would result in
interest exceeding the Highest Lawful Rate in which event such interest
shall be calculated on the basis of a year of 365 or 366 days, as the
case may be). Each determination by Mesa of the Interest Rate hereunder
shall be conclusive and binding for all purposes, absent manifest error.
(c) Whenever any payment hereunder or under the Notes
shall be stated to be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day, and such
extension of time shall in such case be included in the computation of
payment of interest.
ARTICLE III
CONDITIONS OF LENDING
3.1 Condition Precedent to the Bridge Loan. The obligation of
Mesa to make the Bridge Law is subject to the condition precedent that Mesa
shall have received on or before the date hereof the following, in form and
substance satisfactory to Mesa:
(a) this Agreement, the Bridge Note payable to the order
of Mesa, the Security Agreement, the Guaranty and the Refueling
Agreement, in each case duly executed by an authorized officer of SSI,
the Guarantor and/or the Lessees, as applicable;
(b) a legal opinion of Xxxxx, Xxxxx & Xxxxxxxxx, counsel
to SSI, in form and substance satisfactory to Mesa with respect to each
of the following:
(i) the due incorporation and existence of each of SSI
and its Subsidiaries under the laws of the state of its
incorporation;
(ii) the corporate power and authority of SSI and its
Subsidiaries (A) to own its properties and conduct its business as
now conducted and (B) to execute and deliver the Loan Documents to
which it is a party and to perform its obligations thereunder.
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(iii) the due authorization, execution and delivery by
SSI of each Loan Document to which it is a party;
(iv) the enforceability against SSI of each Loan
Document to which SSI is a party;
(v) that there is no material litigation pending or,
to the knowledge of such counsel (after due investigation),
threatened by or against SSI or any of its subsidiaries;
(vi) that the execution and delivery by SSI of the
Loan Documents to which it is a party and the performance by SSI
of its obligations thereunder will not (A) violate any provision
of the Certificate of Incorporation or bylaws of SSI, (B) conflict
with, breach or cause a default under any agreement, document or
instrument known to such counsel (after due investigation) and to
which SSI is a party or by which it or any of its properties is
bound or to which it or any of its properties is subject, or (C)
violate any Legal Requirement;
(vii) the perfection of the liens granted by the
Security Agreement and the Pledge Agreement; and
(viii) such other matters as Mesa may request
(including similar opinions with respect to any subsidiaries party
to any Loan Documents).
(c) a legal opinion of Armour, Goodin, Schlotz & XxxXxxxx,
special counsel to SSI, in form and substance satisfactory to Mesa with
respect to each of the following:
(i) that each of SSI and the Guarantor is not a public
utility subject to the California Public Utilities Code;
(ii) that the execution and delivery by each of SSI of
the Loan Documents to which it is a party, the NGV Leases and the
Refueling Agreement, the execution and delivery by the
Guarantor of the Guaranty, and the execution and delivery by
each of the Franchisees of the NGV Leases to which it is a party
and the Refueling Agreement and the performance by SSI, the
Guarantor and the Franchisees thereunder will not require any
consent, approval. authorization or order of or filing with,
recording, or notification to the California Public Utilities
Commission.
(d) a certificate of the Secretary or Assistant Secretary
and the President or a Vice President of SSI certifying (i) the bylaws of
SSI as in effect as of
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the date hereof (ii) the accuracy of an attached copy of the resolutions
of the Board of Directors of SSI authorizing the execution, delivery and
performance of each of the Loan Documents, the NGV Leases and the
Refueling Agreements, (iii) the names, true signatures and offices held
by officers of SSI authorized to execute and deliver the Loan Documents
to which SSI is a party, (iv) that as of the date hereof no Default or
Event of Default has occurred and is continuing, (v) that the
representations and warranties set forth in the Loan Documents to which
SSI is a party are true and correct as of the date hereof, (vi) that SSI
has not taken any proceedings for the dissolution or liquidation of SSI
or any of its Subsidiaries, (vii) that there has been no amendment of the
Certificate of Incorporation of SSI approved by the Board of Directors of
SSI or the stockholders of SSI or filed with the Secretary of State of
the State of Delaware since May 9, 1988 and (viii) that SSI has complied
with all agreements and conditions required to be complied with by it as
of the date hereof under this Agreement and the other Loan Documents to
which SSI is a party;
(e) a certificate of the Secretary of State of the state
of incorporation of each of SSI and the Subsidiaries as to the continued
existence and good standing of SSI and the Subsidiaries;
(f) certificates for the shares of each of the
Subsidiaries pledged by SSI pursuant to the Pledge Agreement;
(g) evidence of the filing of security instruments and
UCC-1 financing statements and all other documents reasonably required by
Mesa; and
(h) evidence of releases of Liens held by Chrysler Credit
Corporation and Orix Credit Alliance, Inc. and terminations of the
financing statements evidencing such Liens.
3.2 Condition Precedent to the Initial NGV Loan. The
obligation of Mesa to make the Initial NGV Loan is subject to the condition
precedent that Mesa shall have received on or before the Initial NGV Loan Date
the following, in form and substance satisfactory to Mesa:
(a) the applicable NGV Note payable to the order of Mesa,
and the NGV Leases, in each case duly executed by an authorized officer
of SSI or the Lessees, as applicable;
(b) the legal opinion, dated as of the Initial NGV Loan
Date, referred to in Section 3.1(b) hereof;
(c) the legal opinion, dated as of the Initial NGV Loan
Date, referred to in Section 3.1(c) hereof;
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(d) the certificate of the Secretary or Assistant
Secretary and the President or a Vice President of SSI, dated as of the
Initial NGV Loan Date, referred to in Section 3.1(d);
(e) the certificates of the Secretary of State referred to
in Section 3.1(e);
(f) the evidences of filing of amendments to the filings
referred to in Section 3.1(g) to include the vehicle identification
numbers of the applicable NGVs;
(g) copies of the insurance policy or insurance policies
on the NGVs to by purchased with the proceeds of the Initial NGV Loan;
and
(h) all necessary federal, state or local government
permits, licenses, consents, certificates and other authorizations
necessary for Mesa to finance, construct and operate the Refueling
Stations (as defined in the Refueling Agreement).
In addition, Mesa shall have entered into any necessary
contractual arrangements satisfactory to it (i) regarding the construction,
maintenance and operation of the Refueling Stations, including lease
arrangements with Los Angeles International Airport, Xxxx Xxxxx International
Airport and Sky Harbor International Airport for suitable sites on which to
construct the Refueling Stations and (ii) with gas suppliers, intrastate
pipeline companies and the applicable local distribution company in order to
acquire and have transported to the Refueling Stations the necessary supplies of
natural gas via high pressure lines for delivery of such gas as compressed
natural gas to SSI, its Franchisees and the Phoenix Sub, as applicable.
3.3 Conditions Precedent to Subsequent NGV Loans. The
obligation of Mesa to make each NGV Loan subsequent to the Initial NGV Loan is
subject to the condition precedent that Mesa shall have received on or before
each subsequent NGV Loan Date the following, in form and substance satisfactory
to Mesa:
(a) the applicable NGV Note payable to the order of Mesa,
duly executed by an authorized officer of SSI;
(b) the certificate of the Secretary or Assistant
Secretary and the President or a Vice President of SSI, dated as of the
applicable NGV Loan Date, as to the matters referred to in Section
3.1(d);
(c) the certificates of the Secretary of State referred to
in Section 3.1(e);
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(d) the evidences of filing of amendments to the filings
referred to in Section 3.1(g) to include the vehicle identification
numbers of the applicable NGVs; and
(e) copies of the insurance policy or insurance policies
on the NGVs to by purchased with the proceeds of the applicable NGV Loan.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SSI
In consideration of and in order to induce Mesa to enter into
this Agreement and to make the Loans to SSI, SSI represents and warrants as of
the date hereof as follows:
4.1 Organization and Qualification; Subsidiaries. SSI and each
of its subsidiaries (a) is a corporation duly organized, validly existing and in
good standing under the laws of the state of its incorporation, (b) has the
corporate power to own its properties and to carry on its business as now
conducted and as proposed to be conducted, and (c) is duly qualified as a
foreign corporation to do business and is in good standing in each jurisdiction
where the conduct of its business or the ownership of its assets requires such
qualification, except where its failure to be so qualified would not have a
material adverse effect on its business, financial condition or operations. The
only subsidiaries of SSI are the Subsidiaries.
4.2 Power and Authority. Each of SSI, the Phoenix Sub, the LAX
Franchisee and the JWI Franchisee has all necessary corporate and other power
and authority to enter into and perform its obligations under the Loan Documents
to which it is a party and all such action has been duly authorized by all
necessary corporate proceedings on its part.
43 Enforceability. Each of the Loan Documents to which SSI or
any of the Subsidiaries is a party have been or will be duly executed and when
delivered by SSI and my applicable Subsidiary will be, the, legal, valid and
binding obligations of SSI or the applicable Subsidiary, enforceable against SSI
or the applicable Subsidiary in accordance with their respective terms, except
as enforcement many be (i) limited by applicable liquidation, conservatorship,
bankruptcy, moratorium, arrangement, receivership, insolvency, reorganization,
or similar laws, or general equitable principles from time to time effecting
rights of creditors generally, and (ii) subject to the general effect of general
principles of equity.
4.4 Financial Statements. SSI has furnished Mesa with
unaudited consolidated financial statements of SSI and its subsidiaries as at
and for the fiscal years ended September 30, 1992 and September 30, 1993 and for
the seven mouth period ended
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April 30, 1994. These financial statements fairly present the financial position
of SSI at the dates thereof and the results of operations of SSI for the periods
then ended (subject, as to interim statements, to changes resulting from audits
and year-end adjustments, which in the aggregate are not material) and have been
prepared in conformity with GAAP consistently applied throughout the periods
involved. There has been no material adverse change in the business, financial
condition or operations of SSI since April 30, 1994.
4.5 Default. Neither SSI nor any of its subsidiaries is in
default under the provisions of any agreement, document or instrument to which
it is a party or by which it or any of its properties is bound or in violation
of any order, writ, injunction or decree of any Tribunal or in default under, or
in violation of, any order, regulation or demand of any governmental
instrumentality, which default or violation would, individually or in the
aggregate, materially and adversely affect the business, financial condition or
operations of SSI and its subsidiaries.
4.6 Title to Assets, Liens. SSI and each of its subsidiaries
has good and marketable title to its assets. The assets of SSI and each of its
subsidiaries are not subject to any Liens except those permitted under Section
6.2.
4.7 Payment of Taxes. SSI and each of its subsidiaries has
filed all federal and state income, franchise and other tax returns which are
required to be filed and has paid all taxes shown on said returns and all
assessments which are due. SSI and each of its subsidiaries and their respective
officers know of no claims by any governmental authority for any unpaid taxes.
4.8 Absence of Conflicts. The execution, delivery and
performance by SSI of this Agreement and by SSI and any of its subsidiaries of
the Loan Documents to which they are a party and the consummation of the
transactions contemplated hereby and thereby, will not (a) conflict with or
result in any violation of any provision of the Certificate of Incorporation or
the Bylaws, each as amended to date, of SSI or any applicable subsidiary, (b)
conflict with or result in any violation of any of the terms or provisions of,
or constitute a default under, or give any other party a right to terminate any
of its obligations under, or result in the acceleration of any obligation under,
any indenture, mortgage, deed of trust, loan agreement, bond, debenture, note
agreement or other evidence of indebtedness, lease, contract or other agreement
or instrument to which SSI or any applicable subsidiary is a party or by which
SSI or any applicable subsidiary or any of their respective properties are bound
or affected or (c) violate any term of any Legal Requirement applicable to SSI
or any applicable subsidiary or their respective properties or assets except as
provided in the opinion of Armour, Goodin, Schlotz & XxxXxxxx referred to in
Section 3.1(c) hereof.
4.9 Compliance with Laws. SSI and each of its subsidiaries is
in compliance with all Legal Requirements applicable and necessary for the
conduct of its business.
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4.10 Litigation. There are no actions, suits or proceedings
pending or, to the best of SSI's knowledge, threatened against or affecting SSI
or any of its subsidiaries or any of their respective assets before any Tribunal
(a) in which an adverse determination might have a material adverse effect on
the business, financial condition or operations of SSI or any of its
subsidiaries, or (b) which in any manner draws into question the validity or the
enforceability of any Loan Document to which SSI or any of its subsidiaries is a
party. There are no judgments, orders or decrees outstanding against or
affecting SSI or any of its subsidiaries or any of their respective assets
before any Tribunal.
4.11 Margin Stock. SSI does not own, directly or indirectly,
any "margin stock" within the meaning of Regulation U of the Board of Governors
of the Federal Reserve System (herein called "margin stock"). None of the
proceeds of the Loan will be used for the purpose of purchasing or carrying any
margin stock or for the purpose of reducing or retiring any indebtedness which
was originally incurred to purchase or carry margin stock or for any other
purpose which might constitute this transaction a "purpose" credit within the
meaning of said Regulation U, as now in effect or as it may hereafter be
amended.
4.12 Patents, Etc. SSI has all patents, patent rights,
licenses, trademarks, trademark rights, trade names, trade name rights,
copyrights, permits and consents which are required in order for it to conduct
its business as now conducted and as proposed to be conducted, without known
conflict with the rights of others.
4.13 Employee Benefits. No Reportable Event has occurred with
respect to any Plan of SSI or its subsidiaries. SSI has not incurred any
material accumulated funding deficiency within the meaning of ERISA or incurred
any material liability to the Pension Benefit Guaranty Corporation established
under ERISA (or any successor thereto under ERISA) in connection with any Plan
of SSI or its subsidiaries.
4.14 Consents, Etc. Except for (a) the filing of any and all
UCC-1 financing statements required pursuant to any of the Loan Documents in the
Office of the Secretary of State of the State of Texas, the Office of the
Secretary of State of the State of California, or the Office of the Secretary of
State of the State of Arizona and (b) any consent which may be required under
the California Public Utilities Code for SSI to transfer control of the shares
of its Subsidiaries to Mesa pursuant to the terms of the Pledge Agreement, no
authorization, approval or other action by, and no notice to, filing with or
consent of any Person is required to be taken, made or obtained by SSI in
connection with the execution, delivery and performance by SSI of its
obligations under the Loan Documents to which it is a party or the consummation
of the transactions contemplated thereby.
4.15 Fiscal Year. The last day of SSI's fiscal year is
September 30.
4.16 Location of Assets. The Collateral (as defined in the
Security Agreement) is and will be located solely at the locations specified on
Schedule I to the
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Security Agreement and at such other locations specifically permitted by the
terms and provisions of the Security Agreement. The only states where assets of
SSI or any of its Subsidiaries are located are California, Arizona and Texas.
4.17 Subordinated Debt Documents. There are no agreements,
documents or instruments evidencing or relating to any Subordinated Debt of SSI
or its subsidiaries and neither SSI nor any of its subsidiaries has any
Subordinated Debt outstanding.
4.18 Invoices. Each Account of SSI and any of its subsidiaries
is evidenced by a Dated Invoice.
4.19 Solvency. As of the date hereof, and after giving affect
to the Loans and the other Loan Documents, (i) the assets of SSI, at a fair
valuation, will exceed its liabilities, including contingent liabilities; (ii)
the remaining capital of SSI will not be unreasonably small to conduct its
business; and (iii) SSI has not incurred debts, and does not intend to incur
debts, beyond its ability to pay such debts as they mature. For purposes of this
Section 4.19, "debt" means any liability on a claim and "claim" means (x) any
right to payment, whether or not such right is reduced to judgement, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
legal, equitable, secured or unsecured, or (y) any right to an equitable remedy
for breach of performance if such breach gives rise to payment. whether or not
such right to any equitable remedy is reduced to judgement. fixed, contingent,
matured, unmatured disputed, undisputed, secured or unsecured. After giving
effect to this Agreement and the other Loan Documents to which SSI is a party,
SSI is solvent.
4.20 Information. All information heretofore or
contemporaneously furnished by or on behalf of SSI to Mesa for purposes of or in
connection with this Agreement or any other Loan Document or any transaction
contemplated hereby or thereby is, and all other such information hereafter
furnished by or on behalf of SSI in writing to Mesa (i) will be true and
accurate in all material respects on the date as of which such information is
dated or certified, and (ii) will not be incomplete by omitting to state any
material fact necessary to make such information not misleading in light of the
circumstances under which such information was provided. There is no fact known
to SSI which is reasonably likely to have a material adverse effect on the
business, financial condition, properties, prospects or operations of SSI or on
the ability of SSI to perform any of its obligations under this Agreement or any
other Loan Document to which SSI is a party which has not been disclosed, in
writing, to Mesa for use in connection with the transactions contemplated hereby
or by any other Loan Document.
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ARTICLE V
AFFIRMATIVE COVENANTS
Until payment in full of the Loans and all other amounts due to Mesa
under the Loan Documents:
5.1 Information of SSI.
(a) SSI shall deliver to Mesa promptly after any
executive officer of SSI has, or should have, knowledge of the
occurrence of a Default or an Event of Default, a certificate of the
President, a Vice President of the Chief Financial officer of SSI
setting forth the details of such Default or Event of Default.
(b) SSI shall deliver to Mesa, with reasonable
promptness, such financial or other information regarding SSI and its
subsidiaries as Mesa from time to time may reasonably request,
including monthly, quarterly and annual financial statements.
(c) SSI shall deliver to Mesa, no later than one
business day after the completion of a Subsidiary Sale, written notice
of such sale.
5.2 Books and Records. SSI shall maintain proper books of
record and account in accordance with sound accounting practices in which true,
full and correct entries will be made of all of its dealings and business
affairs.
5.3 Insurance. SSI shall maintain (a) insurance covering the
business and assets of SSI and its subsidiaries with responsible companies in
such amounts and against such risks as is customarily carried by owners of
similar businesses and properties, including, without limitation, the
maintenance at all times on and after the date hereof of insurance coverage of
the type and in the amounts in effect as of the due hereof and (b) an umbrella
liability policy covering the business and assets of SSI and its subsidiaries
with liability coverage in the amount of a minimum of S2,000,000 per occurrence,
on terms and with an insurer acceptable to Mesa. In addition, SSI shall maintain
or require each of the Lessees to maintain, an insurance policy or policies on
the NGVs with liability coverage in the amount of a minimum of $1,000,000 per
occurrence per NGV, on terms and with an insurer acceptable to Mesa. SSI hereby
agrees to add Mesa as an additional insured on all such insurance policies, and
all such insurance policies shall provide for not less than 30 days prior
written notice to Mesa for any cancellation, change of coverage or amendment.
SSI shall not change the type or decrease the amount of insurance maintained by
it as of the date hereof without Mesa's prior written consent.
5.4 Loss Payable Endorsements. With respect to any NGV
Insurance acquired by SSI or the Lessees on or after the date hereof SSI shall
or shall require each
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of the Lessees to (a) promptly deliver to Mesa written confirmation from the
applicable insurance company that Mesa has been named as additional insured and
loss payee with respect to such NGV Insurance, and (b) deliver to Mesa, within
ten Business Days after it acquires any such NGV Insurance a loss payable
endorsement, in form and substance satisfactory to Mesa, with respect to such
NGV Insurance.
5.5 Maintenance of Property. SSI shall, at its own expense,
cause the NGVs to be maintained, preserved, protected and kept in good repair,
working order and condition, ordinary wear and tear excepted. SSI shall make all
replacements and additions to its property as may be reasonable necessary to
conduct its business properly and efficiently. Without limiting the foregoing,
SSI shall comply with the requirements of Sections 7, 9 and 10 of the Security
Agreement relating to the NGVs and shall require that the LAX Franchisee, the
JWI Franchisee and its Subsidiaries comply with such provisions and the
provisions of Sections 5.2, 5.3, 5.4, 5.5, 5.6 and 5.7 hereof.
5.6 Inspection of Property and Records. SSI shall permit any
Person designated by Mesa to visit, inspect and audit any of its properties,
corporate books and financial records, to make copies of such books and records
or extracts therefrom, and to discuss the same with its principal officers, all
at such times as Mesa may reasonably request and all at SSI's expense.
5.7 Laws, Obligations. SSI shall (a) comply with all
applicable statutes and governmental regulations, and (b) pay all taxes,
assessments, governmental charges, claims for labor, supplies, rent and other
obligations which if unpaid might become or result in a Lien against its assets,
except any such liabilities being contested in good faith by appropriate
proceedings and for which it maintains adequate reserves in accordance with
GAAP.
5.8 Existence. SSI shall at all times preserve and keep in
full force and effect its corporate existence. SSI shall at all times preserve
and keep in full force and effect the corporate existence of each of its
Subsidiaries (unless merged into SSI or a Subsidiary) and all rights and
franchises of SSI and its Subsidiaries unless, in the good faith judgment of SSI
the termination of or failure to preserve and keep in full force and effect such
corporate existence, right or franchise would not have a materially adverse
effect on the business, operations, affairs, financial condition, properties or
assets of SSI and its Subsidiaries taken as a whole. Notwithstanding the
foregoing, SSI may complete a Subsidiary Sale and the sale of LAX Franchisee as
long as such sale is an arms' length transaction and is on terms that are fair
to SSI.
5.9 Application of Proceeds. SSI shall use the proceeds of the
NGV Loan solely for the purpose of purchasing the NGVs directly from Chrysler
Corporation or an authorized dealer of Chrysler Corporation and subject to the
provisions of the other Loan Documents and the NGV Leases, to modify (a) such
NGVs in a manner deemed necessary by SSI for SSI, or the Lessees, to conduct its
or their respective businesses and (b) the
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gasoline-powered vehicles identified on Schedule 1.1 hereto to enable such
vehicles to operate on compressed natural gas. SSI shall use the proceeds of the
Bridge Loan solely for the purpose of paying in full all amounts owing by SSI
pursuant to the Union Bank Loan.
5.10 Subsidiary Cash Flows. Commencing on the Bridge Loan Date
up to and including the Demand Date, SSI shall reserve 75% of the Cash Flow from
each of the Subsidiaries to repay, when due, the outstanding principal amount of
the Bridge Loan and all accrued and unpaid interest thereon.
5.11 Subsidiary Sales. In the event that SSI completes a
Subsidiary Sale or the sale of LAX Franchisee subsequent to the Demand Date and
prior to the Termination Date, SSI shall use the net proceeds from such
Subsidiary Sale solely to invest in the business of SSI or its subsidiaries and
not for any other purpose.
5.12 Termination Statements. SSI shall deliver to Mesa a
file-stamped copy of the termination of the financing statements evidencing the
releases of Liens held by Chrysler Credit Corporation and Orix Credit Alliance,
Inc. referred to in Section 3.1(h) hereof promptly after the receipt by SSI
thereof.
ARTICLE VI
NEGATIVE COVENANTS
6.1 Capital Expenditures. Prior to the second anniversary of
the last NGV loan, and as long as no Default or Event of Default has occurred
and is continuing the Capital Expenditures of SSI and its subsidiaries on a
consolidated basis, shall not exceed $20O,000 annually in the aggregate.
Notwithstanding this Section 6.1, SSI may in the ordinary and regular course of
its business and in a manner consistent with past practice, purchase fleet
vehicles to replace fleet vehicles currently owned, or operated by SSI or its
subsidiaries or franchisees and (ii) acquire and develop certain communications
software and hardware to be used by SSI, its subsidiaries and franchisees for
reservations and dispatching. Any Capital Expenditures to be made by SSI and its
subsidiaries on a consolidated basis which will exceed $200,000 annually, in the
aggregate, shall be submitted, in writing, to Mesa for its prior approval, which
approval shall not be unreasonably withheld.
6.2 Liens. Neither SSI nor any of its subsidiaries shall
create or permit to exist any Lien upon any of its assets or properties, whether
now owned or hereafter acquired, or assign or otherwise convey to any Person any
right to receive any of its income, except:
(a) Liens for taxes not yet due or which are being
contested in good faith by appropriate proceedings and for which it
maintains adequate reserves;
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(b) Other Liens incidental to the conduct of its
business or the ownership of its assets which are not incurred in
connection with the borrowing of money or the obtaining of advances or
credit and which do not individually or in the aggregate (i) materially
detract from the value of its assets or materially impair the use
thereof in the operation of its business, or (ii) materially and
adversely affect its business, financial condition or operations;
(c) Liens in favor of Mesa; and
(d) Liens, if any, existing on the date hereof and
described on Schedule 6.2(d) attached hereto and made a part hereof.
6.3 Indebtedness. Prior to the second anniversary of the last
NGV Loan, and as long as no Default or Event of Default has occurred and is
continuing, neither SSI nor any of its subsidiaries shall create, assume, incur,
guarantee or permit to exist at any time any Indebtedness, except:
(a) Indebtedness under the Loan Documents, including
all renewals, extensions, replacements, refundings and refinancings
thereof, from time to time, in whole or in part;
(b) Trade Debt that is not due and payable at such
time; and
(c) Indebtedness existing on the date hereof and
reflected on Schedule 6.3(c) hereto.
6.4 Transactions with Affiliates. Neither SSI nor any of its
subsidiaries shall engage in any transaction with any of its Affiliates an terms
less favorable to SSI or the applicable subsidiary than would have been
obtainable in an arm's-length transaction with an unrelated third party,
provided, however, that the foregoing restriction shall not apply to
transactions between SSI and its wholly owned subsidiaries.
6.5 Accounts. Prior to the second anniversary of the last NGV
Loan, and as long as no Default or Event of Default has occurred and is
continuing, no Account of SSI or any of its subsidiaries shall be evidenced by
an invoice dated as of a date other than the date on which (a) the goods giving
rise to such Account were delivered to the Account Debtor under such Account, or
(b) the services giving rise to such Account were rendered to the Account Debtor
under such Account.
6.6 Merger, Consolidation, Sale of Assets, Etc. Prior to the
second anniversary of the last NGV Loan, and as long as no Default or Event of
Default has occurred and is continuing, neither SSI nor any of its subsidiaries
shall (a) merge or consolidate with or into any other Person, or (b) sell,
lease, transfer or otherwise dispose of (whether in one transaction or a series
of transactions) any of its assets.
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6.7 Investments, Loans, Advances, etc. Prior to the second
anniversary of the last NGV Loan, and as long as no Default or Event of Default
has occurred and is continuing, neither SSI nor any of its subsidiaries shall
make, or permit to exist, any Investment in any Person except for Permitted
Investments.
6.8 Guarantees. Prior to the second anniversary of the last
NGV Loan, and as long as no Default or Event of Default has occurred and is
continuing, except for endorsements of instruments for deposit or collection in
the ordinary course of business, neither SSI nor any of its subsidiaries shall
guarantee, or permit to exist any guarantee by it of, any obligations,
liabilities or indebtedness of any Person.
6.9 Dividends, Etc. Prior to the second anniversary of the
last NGV Loan, and as long as no Default or Event of Default has occurred and is
continuing, SSI shall not declare or pay any dividend or distribution in respect
of any capital stock of SSI or purchase, redeem or otherwise acquire or retire
for value or permit any of its subsidiaries to purchase or otherwise acquire for
value any capital stock of SSI.
6.10 NGV Leases. Commencing on the date hereof up to and
including the Termination Date, SSI shall not cancel, pledge, assign or
otherwise encumber the NGV Leases, and SSI shall not enter into any lease with
respect to the NGVs except for the NGV Leases, without the prior written consent
of Mesa.
ARTICLE VII
EVENTS OF DEFAULT
7.1 Events of Default. If any of the following events ("Events
of Default") shall occur:
(a) SSI shall fail to pay any principal of, or
interest on, the NGV Notes when the same become due and payable; or
(b) SSI shall fail to pay any principal of, or
interest on, the Bridge Note when the same becomes due and payable and
such failure continues for a period of 60 days after such payment
became due; or
(c) SSI or its subsidiaries shall fail to perform or
observe any other term, covenant or agreement contained in any Loan
Document on its part to be performed or observed if such failure shall
remain unremedied for 15 days after notice of such event is given by
Mesa to SSI; or
(d) SSI shall generally not pay its debts as such
debts become due, or shall admit in writing its inability to pay its
debts generally, or shall make a
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general assignment for the benefit of creditors; or any proceeding
shall be instituted by or against SSI or any of its subsidiaries
seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, arrangement, adjustment, protection, relief,
or composition of SSI or any of its subsidiaries or SSI's or any of its
subsidiaries' debts under any law relating to bankruptcy or insolvency
or relief of debtors, or seeking the entry of an order for relief or
the appointment of a receiver, trustee, custodian or other similar
official for SSI or any of its subsidiaries or for any substantial part
of its or their Property and, in the case of any such proceeding
instituted against SSI or any of its subsidiaries (but not instituted
by SSI or any of its subsidiaries), either such proceeding shall remain
undismissed or unstayed for a period of 30 days, or any of the actions
sought in such proceeding (including, without limitation, the entry of
an order for relief against, or the appointment of a receiver, trustee,
custodian or other similar official for, SSI or any of its subsidiaries
or for any substantial part of SSI or any of its subsidiaries'
Property) shall occur;
(e) Any judgment or order for the payment of money in
excess of $50,000 shall be rendered against SSI and there shall be any
period of 30 consecutive days during which such judgment is not
satisfied through insurance payments or otherwise or a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect;
(f) SSI or any of its Franchisees or Phoenix Sub
shall fail to perform or observe any term, covenant or agreement
contained in the Refueling Agreement on its part to be performed or
observed if such failure shall remain unremedied for 15 days after
notice of such event is given by Mesa to SSI;
(g) SSI or any of its Franchisees or Phoenix Sub
shall fail to perform or observe any term, covenant or agreement
contained in the NGV Leases on its part to be performed or observed if
such failure shall remain unremedied for 15 days after notice of such
event is given by Mesa to SSI;
(h) (i) SSI shall fail to pay any principal of or
premium or interest on its Indebtedness which is outstanding when the
same becomes due and payable (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise), and such failure shall
continue after the applicable grace period, if any, specified in the
agreement or instrument relating to such Indebtedness; (ii) any other
event shall occur or condition shall exist under any agreement or
instrument relating to such Indebtedness so in default, and shall be
continuing after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such event or condition it to
accelerate, or to permit the acceleration of, the maturity of such
Indebtedness; or (iii) any such Indebtedness shall be declared to be
due and payable, or required to be prepaid (other than by a regularly
scheduled required prepayment), prior to the stated maturity thereof;
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(i) Any Security Document shall for any reason,
except to the extent permitted by the terms thereof, cease to create a
valid and perfected first priority security interest in any of the
Collateral (as defined in the Security Agreement) purported to be
covered thereby or any provision of the Guaranty shall for any reason
cease to be valid and binding on the Guarantor; or
(j) Xxxxx ceases to own at least a majority of the
outstanding capital stock of SSI;
then, and in any such event, Mesa may, by notice to SSI, declare the Notes, all
interest thereon and all other amounts payable under this Agreement to be
forthwith due and payable, whereupon the Note, all such interest and all such
amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived by SSI; provided however, that in the event of an actual or deemed entry
of an order for relief with respect to SSI under the Federal Bankruptcy Code,
the Note, all such interest and all such amounts shall automatically become and
be due and payable, without presentment, demand, protest or any notice of any
kind, all of which are hereby expressly waived by SSI.
ARTICLE VIII
MISCELLANEOUS
8.1 Amendments, Etc. No amendment or waiver of any provision
of this Agreement or the Notes, nor consent to any departure by SSI therefrom,
shall, in any event be effective unless the same shall be in writing and signed
by Mesa, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
8.2 Notices, Etc. All notices and other communications
provided in connection with this Agreement to a party to this Agreement shall,
be in writing (including by facsimile transmission) unless oral notice is
otherwise expressly permitted hereunder, and shall be given to the intended
recipient at the address specified below, or such address as may be provided by
written notice in accordance with this Section 8.2. All such notices and other
communications shall be effective (a) if delivered by facsimile transmission,
when received and telephonically confirmed, (b) if delivered, when delivered at
the address of the recipient specified below, (c) if given orally, at the time
given, provided that written confirmation of such notice shall have been
received in accordance with this Section 8.2 promptly thereafter, and in no
event more than 12 hours after such oral notice has been received, and (d) if
mailed, on the third calendar day after being deposited in the U.S. mail, by
certified mail, postage prepaid, return receipt requested:
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(i) If to SSI
SuperShuttle International, Inc.
0000 Xxxx 000xx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxxxx 00000
Fax: 310/000-0000
Attention: Chief Executive Officer
with a copy to:
Xxxxx, Kahan & Xxxxxxxxx
0000 Xxxxx Xxxxxx, Xxxxxx Xxxxx
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Fax: 310/000-0000
Attention: Xxxxxx X. Xxxxx
(ii) If to Mesa:
Mesa Holding Co.
0000 Xxxxxxxx Xxxx Xxxxxx
0000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Fax: 214/000-0000
Attention: Chief Financial Officer
with a copy to:
Xxxxx & Xxxxx, L.L.P.
0000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000
Fax: 214/000-0000
Attention: Xxxxxx X. Xxxxxx
8.3 No Waiver; Remedies; No failure on the part of Mesa to
exercise, and no delay in exercising, any right under any Loan Document shall
operate as a waiver thereof; nor shall any single or partial exercise of any
such right preclude any other or further exercise thereof or the exercise of any
other right. The remedies herein provided are cumulative and not exclusive of
any remedies provided by law.
8.4 Costs and Expenses of Enforcement. SSI agrees to pay
promptly on demand all costs and expenses, if any (including, without
limitation, reasonable counsel fees and expenses), in connection with the
enforcement (whether through negotiations, legal proceedings or otherwise) of
the Loan Documents and the other documents to be delivered
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under the Loan Documents, including, without limitation, reasonable counsel
fees and expenses in connection with the enforcement of rights under this
Section 8.4.
8.5 Binding Effect. This Agreement shall become effective when
it shall have been executed by SSI and Mesa and thereafter shall be binding upon
and inure to the benefit of SSI and Mesa and their respective successors and
assigns, except that SSI shall not have the right to assign its rights hereunder
or any interest herein without the prior written consent of Mesa.
8.6 Limitation on Agreements.
(a) All agreements between SSI or Mesa, whether now
existing or hereafter arising and whether written or oral, are hereby
expressly limited so that in no contingency or event whatsoever,
whether by reason of demand being made in respect of an amount due
under any Loan Document or otherwise, shall the amount paid, or agreed
to be paid, to Mesa for the use, forbearance, or detention of the money
to be loaned under this Agreement, the Note or any other Loan Document
or otherwise or for the payment or performance of any covenant or
obligation contained herein or in any other Loan Document exceed the
Highest Lawful Rate. If, as a result of any circumstances whatsoever,
fulfillment of any provision hereof or of any of such documents, at the
time performance of such provision shall be due, shall involve
transcending the limit of validity prescribed by applicable usury law,
then, ipso facto, the obligation to be fulfilled shall be reduced to
the limit of such validity, and if, from any such circumstance, Mesa
shall ever receive interest or anything which might be deemed interest
under applicable law which would exceed the Highest Lawful Rate, such
amount which would be excessive interest shall be applied to the
reduction of the principal amount owing on account of the Note or the
amounts owing on other obligations of SSI to Mesa under any Loan
Document and not to the payment of interest, or if such excessive
interest exceeds the unpaid principal balance of the Note and the
amounts owing on other obligations of SSI to Mesa under any Loan
Document, as the case may be, such excess shall be refunded to SSI. All
sums paid or agreed to be paid to Mesa for the use, forbearance, or
detention of the indebtedness of SSI to Mesa shall, to the extent
permitted by applicable law, be amortized, prorated, allocated, and
spread throughout the full term of such indebtedness until payment in
full of the principal (including the period of any renewal or extension
thereof) so that the interest on account of such indebtedness shall not
exceed the Highest Lawful Rate. Notwithstanding anything to the
contrary contained in any Loan Document, it is understood and agreed
that if at any time the rate of interest which accrues on the
outstanding principal balance of the Note shall exceed the Highest
Lawful Rate, the rate of interest which accrues on the outstanding
principal balance of the Note shall be limited to the Highest Lawful
Rate, but any subsequent reductions in the rate of interest which
accrues on the outstanding principal balance of the Note shall not
reduce the rate of interest which accrues on the outstanding principal
balance of the Note below the Highest
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Lawful Rate until the total amount of interest accrued on the outstanding
principal balance of the Note equals the amount of interest which would
have accrued if such interest rate had at all times been in effect. The
terms and provisions of this Section 8.6 shall control and supersede every
other provision of all Loan Documents.
(b) To the extent that Texas law is applicable to the determination of
the Highest Lawful Rate, Mesa and SSI agree that (i) if Article 1.04,
Subtitle 1, Title 79 of the Revised Civil Statutes of Texas, 1925, as
amended, is applicable to such determination, the indicated rate ceiling
computed from time to time pursuant to Section (a) of such Article shall
apply, provided that, to the extent permitted by such Article, Mesa may
from time to time by notice to SSI revise the election of such interest
rate ceiling as such ceiling affects the then current or future balances of
the Advance; and (ii) the provisions of Chapter 15 of Subtitle 3, Title
79, of the Revised Civil Statutes of Texas, 1925, as amended, shall not
apply to this Agreement or the Note.
8.7 Severability. In case any one or more of the provisions contained in
any Loan Document or in any instrument contemplated thereby, or any application
thereof, shall be invalid, illegal, or unenforceable in any respect, the
validity, legality, and enforceability of the remaining provisions contained
therein, and any other application thereof, shall not in any way be affected or
impaired thereby. Each covenant contained in any Loan Document shall be
construed (absent an express contrary provision herein) as being independent of
each other covenant contained therein, and compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with one or more other covenants
8.8 Governing Law and Consent to Jurisdiction. THIS AGREEMENT AND THE
NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS
(AS OPPOSED TO CONFLICTS OF LAW PRINCIPLES) AND JUDICIAL DECISIONS OF THE STATE
OF TEXAS AND APPLICABLE UNITED STATES FEDERAL LAW, AND IS INTENDED TO BE
PERFORMED IN ACCORDANCE WITH, AND ONLY TO THE EXTENT PERMITTED BY SUCH LAWS. TO
THE EXTENT PERMITTED BY APPLICABLE LAW, SSI HEREBY SUBMITS TO THE NONEXCLUSIVE
JURISDICTION OF ANY TEXAS STATE COURT, OR ANY UNITED STATES FEDERAL COURT,
SITTING IN THE CITY OF DALLAS, TEXAS, AND TO THE NONEXCLUSIVE JURISDICTION OF
ANY STATE OR UNITED STATES COURT SITTING IN ANY STATE IN WHICH ANY OF THE NGVs
ARE LOCATED, FOR THE PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. SSI HEREBY
IRREVOCABLY APPOINTS XXXXX XXXX (THE "PROCESS AGENT"), WITH AN OFFICE ON THE
DATE HEREOF AT 000 XXXX XXXXXX XXXX, XXXXXXXXX, XXXXX 00000 AS ITS AGENT TO
RECEIVE ON BEHALF OF SSI AND ITS PROPERTY SERVICE OF COPIES OF THE SUMMONS AND
COMPLAINT AND ANY OTHER PROCESS WHICH MAY BE SERVED IN ANY SUCH ACTION OR
PROCEEDING.
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SUCH SERVICE MAY BE MADE BY MAILING OR DELIVERING A COPY OF SUCH PROCESS TO SSI
IN CARE OF THE PROCESS AGENT AT THE PROCESS AGENT'S ABOVE ADDRESS, AND SSI
HEREBY IRREVOCABLY AUTHORIZES AND DIRECTS THE PROCESS AGENT TO ACCEPT SUCH
SERVICE ON ITS BEHALF. AS AN ALTERNATIVE METHOD TO SERVICE, SSI ALSO
IRREVOCABLY CONSENTS TO THE SERVICE OF ANY AND ALL PROCESS IN ANY SUCH ACTION
OR PROCEEDING BY THE MAILING OF COPIES OF SUCH PROCESS TO SSI AT ITS ADDRESS
SET FORTH IN SECTION 8.2 HEREOF. SSI AGREES THAT A FINAL JUDGMENT IN ANY SUCH
ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
SSI FURTHER WAIVES ANY OBJECTION TO VENUE IN SUCH STATE AND ANY OBJECTION TO
ANY ACTION OR PROCEEDING IN SUCH STATE ON THE BASIS OF FORUM NON CONVENIENS.
NOTHING IN THIS SECTION 8.8 SHALL AFFECT THE RIGHT OF MESA TO SERVE LEGAL
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT THE RIGHT OF MESA TO
BRING ANY ACTION OR PROCEEDING AGAINST SSI OR ITS PROPERTY IN THE COURTS OF ANY
OTHER JURISDICTION.
8.9 Execution in Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.
8.10 Right to Factor Loan. Mesa may sell, factor, assign or offer
participations in its rights in the Loans at such times and upon such terms as
Mesa considers appropriate. Upon any such sale, or other transaction, Mesa shall
promptly disclose to SSI the identification of each purchaser or other party.
8.11 Final Agreement. THE LOAN DOCUMENTS AND THE MASTER AGREEMENT
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES WITH RESPECT TO THE SUBJECT
MATTER HEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS,
OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES, THERE ARE NO ORAL AGREEMENTS
BETWEEN THE PARTIES.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first above written.
SUPERSHUTTLE INTERNATIONAL, INC.
By: /s/ Xxxxxxxx X. Xxxxx
-------------------------------
Xxxxxxxx X. Xxxxx
Chief Executive Officer
MESA HOLDING CO.
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------
Xxxxxxx X. Xxxxxxx
Vice President, Chief Financial Officer
