Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
$60,000,000
LOAN AND SECURITY AGREEMENT
Dated as of January 31, 2000
BETWEEN
XXXXXX BOATS & MOTORS, INC.
a Texas corporation,
and its Subsidiaries Listed Herein
as Borrowers
AND
DEUTSCHE FINANCIAL SERVICES CORPORATION
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
1. DEFINITIONS.....................................................................................................1
2. CREDIT FACILITY.................................................................................................7
2.1 TOTAL CREDIT FACILITY........................................................................................7
---------------------
2.2 FLOORPLAN LOANS..............................................................................................7
---------------
2.2.1 Inventory Floorplan Loan Limit..........................................................................7
------------------------------
2.2.2 Payment Terms for Floorplan Inventory...................................................................7
-------------------------------------
2.3 REVOLVING CREDIT FACILITY....................................................................................8
-------------------------
2.3.1 Eligible Accounts.......................................................................................8
-----------------
2.3.2 Eligible New Inventory..................................................................................8
----------------------
2.3.3 Eligible Used Inventory.................................................................................8
-----------------------
2.3.4 Eligible Parts..........................................................................................8
--------------
2.3.5 Payment Terms for Eligible Inventory....................................................................8
------------------------------------
2.4 MANDATORY PREPAYMENT.........................................................................................8
--------------------
2.5 INTEREST; CALCULATION OF CHARGES; FEES.......................................................................9
--------------------------------------
2.5.1 Interest - Floorplan Inventory Loans....................................................................9
------------------------------------
2.5.2 Interest - Revolving Credit Loans.......................................................................9
---------------------------------
2.5.3 Calculation of Charges..................................................................................9
----------------------
2.5.4 Method of Transfer......................................................................................9
------------------
2.5.5 Definitions.............................................................................................9
-----------
2.5.6 Fees...................................................................................................10
----
2.5.6.1 Non-Use of Credit Facility Fee.....................................................................10
------------------------------
2.5.6.2 Administration Fees................................................................................10
-------------------
2.6 BILLING STATEMENT...........................................................................................10
-----------------
2.7 LOAN PROCEEDS...............................................................................................10
-------------
2.8 DEFAULT INTEREST RATE.......................................................................................10
---------------------
2.9 INTEREST RATE AFTER CERTAIN EVENTS..........................................................................10
----------------------------------
2.10 VERIFICATION RIGHTS OF DFS................................................................................11
--------------------------
2.11 REPORTS...................................................................................................11
-------
2.11.1 Biweekly Reports.......................................................................................11
----------------
2.11.2 Monthly Reports.........................................................................................11
---------------
2.11.3 Updated Borrowing Base Certificates....................................................................11
-----------------------------------
2.11.4 Covenant Compliance Certificates.......................................................................11
--------------------------------
2.11.5 Other Reports..........................................................................................11
-------------
2.11.6 Accuracy of Reports....................................................................................11
-------------------
2.12 ESTABLISHMENT OF RESERVES.................................................................................11
-------------------------
2.13 UNAVAILABILITY OF LIBOR RATE; CAPITAL ADEQUACY............................................................11
----------------------------------------------
2.14 COLLECTIONS...............................................................................................12
-----------
2.15 ADVANCEMENTS..............................................................................................12
------------
2.16 CONTINUING REQUIREMENTS - ACCOUNTS........................................................................13
----------------------------------
2.17 PERFORMANCE RESERVE.......................................................................................13
-------------------
2.17.1 Conditions Precedent...................................................................................13
--------------------
2.17.2 Use of the Performance Reserve....................................................................13
------------------------------
3. TERM OF AGREEMENT..............................................................................................14
3.1 TERMINATION.................................................................................................14
-----------
3.1.1 Early Termination......................................................................................14
-----------------
3.2 EFFECT OF TERMINATION.......................................................................................14
---------------------
4. BORROWING AND REPAYMENT PROCEDURES.............................................................................15
4.1. BORROWING PROCEDURES......................................................................................15
--------------------
4.1.1 Generally..............................................................................................15
---------
4.1.2 Loan Options...........................................................................................15
------------
4.1.3 Conditions Precedent to Each Loan......................................................................15
---------------------------------
i
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
4.2 ALL LOANS ONE OBLIGATION....................................................................................16
------------------------
4.3 PAYMENTS OF PRINCIPAL AND INTEREST..........................................................................16
----------------------------------
4.4 COLLECTION DAYS.............................................................................................16
---------------
5. SECURITY FOR THE OBLIGATIONS...................................................................................16
5.1 GRANT OF SECURITY INTEREST..................................................................................16
--------------------------
5.2 FUTURE ADVANCES.............................................................................................16
---------------
5.3 FINANCING STATEMENTS........................................................................................16
--------------------
5.4 FURTHER ASSURANCES..........................................................................................16
------------------
6. CONDITIONS PRECEDENT...........................................................................................16
6.1 CONDITIONS PRECEDENT........................................................................................17
--------------------
6.1.1 DFS' Counsel...........................................................................................17
------------
6.1.2 No Material Adverse Change.............................................................................17
--------------------------
6.1.3 Perfected Liens........................................................................................17
---------------
6.1.4 Insurance..............................................................................................17
---------
6.1.5 Laws...................................................................................................17
----
6.1.6 Certificate of Good Standing...........................................................................17
----------------------------
6.1.7 Opinion of Borrower's Counsel..........................................................................17
-----------------------------
6.1.8 UCC Searches...........................................................................................17
------------
6.1.9 Other Documents........................................................................................17
---------------
6.1.10 President's Certificate................................................................................17
-----------------------
6.1.11 Articles of Incorporation...............................................................................17
-------------------------
6.1.12 Secretary's Certificate of Resolution and Incumbency...................................................17
----------------------------------------------------
6.1.13 Pre-closing Expenses...................................................................................18
--------------------
6.1.14 Pre-closing Reviews....................................................................................18
-------------------
6.1.15 Payoff Letters.........................................................................................18
--------------
7. REPRESENTATIONS AND WARRANTIES.................................................................................18
7.1 FINANCIAL STATEMENTS........................................................................................18
--------------------
7.2 NON-EXISTENCE OF DEFAULTS...................................................................................18
-------------------------
7.3 LITIGATION..................................................................................................18
----------
7.4 NO MATERIAL ADVERSE CHANGES.................................................................................18
---------------------------
7.5 TITLE TO COLLATERAL.........................................................................................18
-------------------
7.6 CORPORATE STATUS............................................................................................18
----------------
7.7 SUBSIDIARIES................................................................................................19
------------
7.8 POWER AND AUTHORITY.........................................................................................19
-------------------
7.9 PRINCIPAL PLACE OF BUSINESS.................................................................................19
---------------------------
7.10 ENFORCEABILITY OF THE LOAN DOCUMENTS......................................................................19
------------------------------------
7.11 TAXES.....................................................................................................19
-----
7.12 COMPLIANCE WITH LAWS......................................................................................19
--------------------
7.13 CONSENTS..................................................................................................19
--------
7.14 PURPOSE...................................................................................................19
-------
7.15 CONDITION OF THE BUSINESS.................................................................................19
-------------------------
7.16 CAPITAL...................................................................................................20
-------
7.17 LOCATION OF COLLATERAL....................................................................................20
----------------------
7.18 REAL PROPERTY.............................................................................................20
-------------
7.19 WARRANTIES AND REPRESENTATIONS-ACCOUNTS...................................................................20
---------------------------------------
7.20 SOLVENCY..................................................................................................20
--------
7.21 BUSINESS LOCATIONS; AGENT FOR PROCESS.....................................................................20
-------------------------------------
7.22 WARRANTIES AND REPRESENTATIONS-INVENTORY & PARTS..........................................................20
------------------------------------------------
7.23 REAFFIRMATION.............................................................................................21
-------------
7.24 SURVIVAL OF REPRESENTATIONS AND WARRANTIES................................................................21
------------------------------------------
ii
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
8. BORROWER'S COVENANTS...........................................................................................21
8.1 AFFIRMATIVE COVENANTS.......................................................................................21
---------------------
8.1.1 Payment and Performance................................................................................21
-----------------------
8.1.2 Insurance..............................................................................................21
---------
8.1.2.1 Type of Insurance..................................................................................21
-----------------
8.1.2.2 Requirements as to Insurance Policies..............................................................21
-------------------------------------
8.1.2.3 Collection of Claims...............................................................................21
--------------------
8.1.2.4 Blanket Policies...................................................................................22
----------------
8.1.2.5 Delivery of Policies or Certificates of Insurance..................................................22
-------------------------------------------------
8.1.3 Collection of Receivables; Sale of Inventory............................................................22
--------------------------------------------
8.1.4 Notice of Litigation and Proceedings....................................................................22
------------------------------------
8.1.5 Payment of Debt to Third Persons........................................................................22
--------------------------------
8.1.6 Notice of Change of Business Location...................................................................22
-------------------------------------
8.1.7 Payment of Taxes........................................................................................22
----------------
8.1.8 Further Assurances......................................................................................22
------------------
8.1.9 Maintenance of Status...................................................................................22
---------------------
8.1.10 Financial Statements; Reporting Requirements; Certification as to Events of Defaults...................23
------------------------------------------------------------------------------------
8.1.11 Notice of Existence of Default.........................................................................23
------------------------------
8.1.12 Compliance with Laws...................................................................................24
--------------------
8.1.13 Maintenance of Collateral..............................................................................24
-------------------------
8.1.14 Collateral Records and Statements......................................................................24
---------------------------------
8.1.15 Inspection of Collateral...............................................................................24
------------------------
8.1.16 Landlord's Agreements..................................................................................24
---------------------
9. FINANCIAL COVENANTS............................................................................................24
9.1 AMOUNTS......................................................................................................24
-------
9.1.1 Minimum Tangible Net Worth.............................................................................24
--------------------------
9.1.2 Minimum Current Ratio..................................................................................24
---------------------
9.1.3 Maximum Debt to Tangible Net Worth.....................................................................24
----------------------------------
9.2 CERTAIN DEFINITIONS..........................................................................................25
-------------------
9.3 COVENANT COMPLIANCE CERTIFICATE.............................................................................25
-------------------------------
10. NEGATIVE COVENANTS..........................................................................................25
10.1 CHANGE OF NAME, ETC.......................................................................................25
-------------------
10.2 SALE OR TRANSFER OF ASSETS................................................................................25
--------------------------
10.3 CHANGE IN CONTROL.........................................................................................25
-----------------
10.4 ENCUMBRANCE OF ASSETS.....................................................................................26
---------------------
10.5 FALSE CERTIFICATES OR DOCUMENTS...........................................................................26
-------------------------------
10.6 ASSIGNMENT................................................................................................26
----------
10.7 TRANSACTIONS WITH AFFILIATES..............................................................................26
----------------------------
10.8 LOANS BY BORROWER.........................................................................................26
-----------------
10.9 FISCAL YEAR; ACCOUNTING METHODS...........................................................................26
-------------------------------
10.10 TOTAL DEBT................................................................................................26
----------
10.11 ADVERSE TRANSACTIONS......................................................................................26
--------------------
10.12 GUARANTIES................................................................................................26
----------
10.13 XXXX-AND-HOLD SALES, ETC..................................................................................27
------------------------
10.14 MARGIN SECURITIES.........................................................................................27
-----------------
11. DEFAULT/REMEDIES............................................................................................27
11.1 EVENTS OF DEFAULT.........................................................................................27
-----------------
11.1.1 Failure to Pay Principal or Interest...................................................................27
------------------------------------
11.1.2 Failure to Pay Other Amounts to DFS....................................................................27
-----------------------------------
11.1.3 Failure to Pay Certain Costs and Expenses..............................................................27
-----------------------------------------
11.1.4 Failure to Pay Amounts Owed to Other Persons...........................................................27
--------------------------------------------
11.1.5 Certain Representations and Warranties Without A Curing Period.........................................27
--------------------------------------------------------------
11.1.6 Certain Representations and Warranties With A Curing Period............................................27
-----------------------------------------------------------
11.1.7 Certain Covenants With a Curing Period.................................................................27
--------------------------------------
iii
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
11.1.8 Certain Covenants Without a Curing Period..............................................................27
-----------------------------------------
11.1.9 Default Under Other Agreements.........................................................................28
------------------------------
11.1.10 Bankruptcy, Etc.......................................................................................28
---------------
11.1.10.1 Voluntary Cases..................................................................................28
---------------
11.1.10.2 Involuntary Cases................................................................................28
-----------------
11.1.11 Judgment, Attachments, Etc............................................................................28
--------------------------
11.1.12 Suspension, Dissolution or Liquidation................................................................28
--------------------------------------
11.1.13 Loss of Franchise.....................................................................................28
-----------------
11.1.14 Liens Other Than Permitted Liens......................................................................28
--------------------------------
11.1.15 Loan Documents; Security Interest.....................................................................28
---------------------------------
11.1.16 Loss of Collateral....................................................................................28
------------------
11.1.17 Loss of Guaranty......................................................................................29
----------------
11.1.18 Material Adverse Change................................................................................29
-----------------------
11.2 RIGHTS AND REMEDIES.......................................................................................29
-------------------
11.2.1 Cessation of Advances; Acceleration; etc...............................................................29
----------------------------------------
11.2.2 Collateral in Trust for DFS............................................................................29
---------------------------
11.2.3 Delivery of Collateral to DFS..........................................................................29
-----------------------------
11.2.4 Default Interest.......................................................................................29
----------------
11.2.5 Collection of Accounts; DFS Possession of Collateral by DFS; etc.......................................29
----------------------------------------------------------------
11.2.6 Immediate Acceleration.................................................................................29
----------------------
12. SALE OF COLLATERAL..........................................................................................30
13. INDEMNIFICATIONS............................................................................................30
14. OTHER TERMS.................................................................................................30
14.1 AMENDMENT, CHANGES AND MODIFICATION.......................................................................30
-----------------------------------
14.2 BINDING EFFECT............................................................................................30
--------------
14.3 BROKER FEE................................................................................................31
----------
14.4 ENTIRE AGREEMENT..........................................................................................31
----------------
14.5 HEADINGS..................................................................................................31
--------
14.6 INCORPORATION BY REFERENCE................................................................................31
--------------------------
14.7 INTERPRETATION............................................................................................31
--------------
14.8 NOTICES...................................................................................................31
-------
14.9 NO THIRD PARTY BENEFICIARY RIGHTS AND RELIANCE............................................................31
----------------------------------------------
14.10 PROTECTION OR PRESERVATION OF COLLATERAL..................................................................32
----------------------------------------
14.11 RELATIONSHIP OF THE PARTIES...............................................................................32
---------------------------
14.12 REVERSAL OF PAYMENTS......................................................................................32
--------------------
14.13 SEVERABILITY..............................................................................................32
------------
14.14 MAXIMUM INTEREST..........................................................................................32
----------------
14.15 WAIVERS BY DFS............................................................................................32
--------------
14.16 SURVIVAL..................................................................................................32
--------
14.17 PARTICIPATIONS; ASSIGNMENTS...............................................................................32
---------------------------
14.18 COUNTERPARTS..............................................................................................33
------------
14.19 INFORMATION...............................................................................................33
-----------
14.20 RELEASE...................................................................................................33
-------
14.21 MISCELLANEOUS.............................................................................................33
-------------
14.22 WAIVERS BY BORROWER.......................................................................................33
-------------------
14.23 NO ORAL AGREEMENTS........................................................................................33
14.24 USE OF COUNSEL AND RECEIPT OF AGREEMENT...................................................................34
---------------------------------------
14.25 FACSIMILES, ETC...........................................................................................34
---------------
14.26 POWER OF ATTORNEY.........................................................................................34
-----------------
15. BINDING ARBITRATION.........................................................................................34
15.1 ARBITRABLE CLAIMS.........................................................................................34
-----------------
15.2 ADMINISTRATIVE BODY.......................................................................................35
-------------------
15.3 DISCOVERY.................................................................................................35
---------
iv
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
15.4 EXEMPLARY OR PUNITIVE DAMAGES.............................................................................35
-----------------------------
15.5 CONFIDENTIALITY OF AWARDS.................................................................................35
-------------------------
15.6 PREJUDGMENT AND PROVISIONAL REMEDIES......................................................................35
------------------------------------
15.7 ATTORNEYS' FEES...........................................................................................35
---------------
15.8 LIMITATIONS...............................................................................................36
-----------
15.9 SURVIVAL AFTER TERMINATION................................................................................36
--------------------------
16. INVALIDITY/UNENFORCEABILITY OF BINDING ARBITRATION..........................................................36
---------------------------------------------------
17. GOVERNING LAW...............................................................................................36
-------------
v
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
LOAN AND SECURITY AGREEMENT
BETWEEN: Deutsche Financial Services Corporation, a Nevada corporation ("DFS")
AND: XXXXXX BOATS & MOTORS, INC. a Texas corporation; TBC Arkansas, Inc. a
Arkansas corporation; Xxxxxx Boating Center Arlington, Inc. a Texas
corporation; Xxxxxx Boating Center Beaumont, Inc. a Texas corporation;
Xxxxxx Boating Center Oklahoma, Inc. a Texas corporation; Xxxxxx Boating
Center Tennessee, Inc. a Texas corporation; Xxxxxx Xxxxxxx Marine, Inc. a
Texas corporation; Falcon Marine, Inc. a Texas corporation; Falcon Marine
Abilene, Inc. a Texas corporation; Xxxxxx Boating Center Alabama, Inc. a
Texas corporation; Xxxxxx Boating Center Louisiana, Inc. a Louisiana
corporation; Xxxxxx Boats & Motors Baton Rouge, Inc. a Louisiana
corporation; and Xxxxxx Boating Center Mississippi, Inc. a Texas
corporation; Xxxxxx Boating Center Little Rock, Inc., an Arkansas
corporation; Red River Marine Arkansas, Inc., an Arkansas corporation;
Shelby Marine Center, Inc., a Tennessee corporation; and Shelby Marine
Pickwick, LLC, a Tennessee limited liability corporation (individually,
collectively, jointly and severally "Borrower").
EFFECTIVE DATE: January 31, 2000
RECITALS
Borrower has requested that DFS provide Borrower with a revolving credit
facility and a credit facility for inventory acquisition purposes.
1. DEFINITIONS
Terms defined in this Agreement shall have initial capital letters. Those
terms are defined below, in this Section 1, and elsewhere in this Agreement. All
financial and accounting terms used herein and not otherwise defined, shall be
defined in accordance with GAAP.
"AAA" shall have the meaning set forth in Section 16.2.
"Account Debtor" shall mean any Person who is or who may become obligated
to Borrower under, with respect to, or on account of an Account, general
intangible or other Collateral.
"Accounts" shall have the meaning given to that term in the UCC, and, to
the extent not included therein, shall also mean all accounts, leases, contract
rights, chattel paper, general intangibles, choses in action and instruments,
including any Lien or other security interest that secures or may secure any of
the foregoing, plus all books, invoices, documents and other records in any form
evidencing or relating to any of the foregoing, now owned or hereafter acquired
by Borrower, in each case arising only from Eligible Inventory.
"Affiliates" shall mean: (i) any individual who is an officer or director
of a Person; and (ii) any Person who directly or indirectly controls, is
controlled by, or is under common control or ownership with, another Person. For
the purposes of this definition, the term "control" shall mean the ownership of
or the ability to direct or control 10% or more of the beneficial interest in
the applicable entity.
"Agreement" shall mean this Loan and Security Agreement, and any
amendments hereto.
"Average Daily Balance" shall have the meaning set forth in Section 2.5.5.
1
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
"Borrowing Base" shall mean, as of any date of determination, an amount
equal to the sum of: (a) the Eligible Account -------------- Availability; plus
(b) the Eligible Inventory Availability; plus (c) Eligible Parts Availability.
---- ----
"Borrowing Base Certificate" shall have the meaning set forth in Section
2.3.1.
"Business" shall mean the sale of marine inventory.
"Business Day" shall mean any day other than Saturdays, Sundays, legal
holidays designated by Federal law, and any other day on which DFS' office is
closed.
"Collateral" shall mean all items described in Section 5.1.
"Cost" shall mean the original invoice price of Inventory or Parts, as
applicable, net of all discounts, plus (in the case of Inventory only)
applicable freight.
"Credit Facility" shall have the meaning set forth in Section 2.1.
"Daily Contract Balance" shall have the meaning set forth in Section
2.5.3.
"Daily Rate" shall have the meaning set forth in Section 2.5.5.
"Debt" shall mean all of Borrower's liabilities and indebtedness of any
kind and nature whatsoever other than Subordinated Debt whether direct or
indirect, absolute, contingent (but only to the extent that GAAP would require
such contingent liability to be listed on the Borrower's balance sheet rather
than the footnotes), and including obligations under capitalized leases,
guaranties (but only to the extent that GAAP would require the liability under
such guaranty to be listed on the Borrower's balance sheet rather than in the
footnotes) or with respect to which Borrower has pledged assets to secure
performance, whether or not direct recourse liability has been assumed by
Borrower.
"Default" shall have the meaning set forth in Section 12.
"Default Interest Rate" shall have the meaning set forth in Section 2.8.
"DFS Companies" shall have the meaning set forth in Section 16.1.
"Disputes" shall have the meaning set forth in Section 16.1.
"Effective Date" shall mean the date set forth in the heading on page 1 of
this Agreement.
"Electronic Transfers" shall have the meaning set forth in Section 2.5.4.
"Eligible Accounts" shall mean all Accounts that are not Ineligible
Accounts.
"Eligible Account Availability" shall have the meaning set forth in
Section 2.3.1.
"Eligible Inventory" means Borrower's: (i) Eligible New Inventory, and
(ii) Eligible Used Inventory as defined herein.
"Eligible Inventory Availability" shall mean the aggregate of: (i) the
Eligible New Inventory Availability (as defined in Section 2.3.2), plus (ii) the
Eligible Used Inventory Availability (as defined in Section 2.3.3).
2
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
"Eligible New Inventory" shall mean Borrower's new and unused Inventory
held for sale, but not rental or lease, that is owned by Borrower free and clear
of all Liens, security interests and encumbrances of any third parties, except
for the Permitted Liens, that is not obsolete or unmerchantable, that is in
good, new and salable condition that conforms to the representations and
warranties of Section 7.22 of this Agreement, and which DFS deems, in its
reasonable discretion, to be acceptable for financing; provided, however, that
Inventory will only be Eligible New Inventory for so long as it has been owned
by Borrower seven hundred twenty (720) days or less.
"Eligible Parts Inventory" shall mean all Parts owned by Borrower free and
clear of all Liens of any third parties, except for the Permitted Liens, that
are in good, new and salable condition and that do conform to the
representations and warranties of Section 7.22 of this Agreement and that are
not Ineligible Parts.
"Eligible Parts Availability" shall have the meaning set forth in Section
2.3.4.
"Eligible Used Inventory" shall mean shall mean Borrower's Inventory not
purchased directly from the manufacturer thereof or previously sold at retail,
which is held for sale, but not rental or lease, that is owned by Borrower free
and clear of all Liens, security interests and encumbrances of any third
parties, except for the Permitted Liens, that is not obsolete or unmerchantable,
that is in good and salable condition that conforms to the representations and
warranties of Section 7.22 of this Agreement, and which DFS deems, in its
reasonable discretion, to be acceptable for financing; provided, however, that
Inventory will only be Eligible New Inventory for so long as it has been owned
by Borrower three hundred sixty-five (365) days or less.
"Equipment" shall have the meaning as given to that term in the UCC, and,
to the extent not included therein, shall also mean all equipment, machinery,
trade fixtures, furnishings, furniture, supplies, materials, tools, machine
tools, office equipment, appliances, apparatus, parts and all attachments,
replacements, substitutions, accessions, additions and improvements to any of
the foregoing.
"Excess Advances" shall have the meaning given in Section 2.4.
"FAA" shall have the meaning set forth in Section 16.5.
"Floorplan Inventory" shall mean Inventory the acquisition of which was
financed by DFS for Borrower pursuant to Section 2.2 from Vendors which have a
program with, and are in good standing with, DFS.
"Floorplan Inventory Loan" shall have the meaning set forth in Section
2.2.
"GAAP" shall mean generally accepted accounting principles, consistently
applied.
"Guarantor" shall mean a guarantor of any of the Obligations.
"Indemnified Liabilities" shall have the meaning set forth in Section 14.
"Indemnitees" shall have the meaning set forth in Section 14.
"Ineligible Accounts" shall mean: (a) Accounts created from the sale of
goods and services on non-standard terms and/or that allow for payment to be
made more than thirty (30) days from date of sale; (b) Accounts unpaid more than
ninety (90) days from date of invoice; (c) all Accounts of any Account Debtor if
fifty percent (50%) or more of the outstanding balance of such Accounts are
unpaid more than ninety (90) days from the date of invoice; (d) Accounts for
which the Account Debtor is an officer, director, shareholder, partner, member,
owner, employee, agent, parent, Subsidiary, or Affiliate of, or is related to,
Borrower or has common shareholders, officers, directors, owners, partners or
members with Borrower; (e) consignment sales; (f) Accounts for which the payment
3
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
is or may be conditional; (g) Accounts for which the Account Debtor is not a
commercial or institutional entity or is not a resident of the United States or
Canada; (h) Accounts with respect to which any warranty or representation
provided in Section 7.19 is not true and correct; (i) Accounts which represent
goods used for demonstration purposes or loaned by Borrower to another party;
(j) Accounts which are progress payment, barter, or contra accounts; and (k) any
and all other Accounts which DFS deems to be ineligible.
"Ineligible Parts" shall means Parts: (a) against which any balance is
owed thereon to any manufacturer or supplier thereof; (b) that are included in
any work-in-process; (c) which are obsolete; (d) not owned by Borrower free and
clear of all Liens of any third parties, except for the Permitted Liens; (e)
that are not in good, new and salable condition; (f) that do not conform to the
representations and warranties of Section 7.22 of this Agreement; or (g) which
DFS deems to be ineligible.
"Intangibles" shall have the meaning set forth in Section 9.2.
"Inventory" shall have the meaning given to that term in the UCC, and, to
the extent not included therein, shall also mean all of Borrower's merchandise,
materials, whole goods, finished goods, work-in-process, component materials,
packaging, shipping materials, parts and other tangible personal property, now
owned or hereafter acquired and held for sale or which contribute to the
finished products or the sale, promotion, storage and shipment thereof, whether
located at facilities owned or leased by Borrower, or in the course of transport
to or from facilities owned or leased by Borrower.
"LIBOR Rate" shall mean for any calendar month the London Interbank
Offered Rate (LIBOR) per annum for deposits in U.S. Dollars for ninety (90) days
(a) as published in The Wall Street Journal on the last Business Day of the
prior calendar month, or (b) if not published in The Wall Street Journal on such
last Business Day of the prior month, then the LIBOR Rate for such calendar
month shall be such rate that appears in The Dow Xxxxx Telerate Service,
Bloombergs or similar service on the last Business Day of the prior month, or
(c) if not published in The Wall Street Journal, Dow Xxxxx Telerate Service,
Bloombergs or similar service used by DFS, then, the LIBOR Rate for such
calendar month shall be computed pursuant to Section 2.13 hereof.
"LIBOR Rate Equivalent" shall have the meaning set forth in Section
2.13(a).
"LIBOR Rate Loan" shall mean a Revolving Credit Loan which Borrower has
requested to be made under the LIBOR Rate.
"Lien" shall mean any security interest, mortgage, pledge, lien,
hypothecation, judgment lien or similar legal process, charge, encumbrance,
title retention agreement or analogous instrument or device (including, without
limitation, the interest of lessors under capitalized leases and the interest of
a vendor under any conditional sale or other title retention agreement),
reservations, exceptions, encroachments, easements, rights-of-way, covenants,
conditions, restrictions, leases and other title exceptions and encumbrances
affecting any of Borrower's property.
"Loan" shall mean any advance made to or for the benefit of Borrower
pursuant to this Agreement, including but not limited to any Floorplan Inventory
Loan and any Revolving Credit Loan.
"Loan Documents" shall mean all documents executed by Borrower pursuant to
any financial accommodation between Borrower and DFS and all documents entered
into in connection with the transaction herein contemplated. The term "Loan
Documents" includes, but is not limited to, this Agreement, all financing
statements, all pledges, mortgages, deeds of trust, leasehold mortgages,
security agreements, guaranties, assignments, subordination agreements, and any
future or additional documents or writings executed under the terms of this
Agreement or any amendments or modifications hereto.
4
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
"Material Adverse Change" shall mean as to Borrower, any Guarantor and
with respect to any event or occurrence whatsoever (including, without
limitation, any adverse determination in any litigation, arbitration,
investigation or proceeding), a material adverse change on the business,
operations, revenues, financial condition, property or business prospects of
Borrower or any Guarantor, or a material adverse change on the ability of
Borrower or any Guarantor to timely pay or perform any of Borrower's or any such
Guarantor's Debt taken generally as a whole, or in the case of Borrower
specifically, the ability of Borrower to pay or perform any of Borrower's
Obligations to DFS, or in the case of any Guarantor specifically, the ability of
any Guarantor to pay or perform any Obligations to DFS which are guarantied by
the Guarantor.
"Monthly Reports" shall have the meaning given in Section 2.11.1.
"Net Book Value" shall mean Borrower's Cost of Inventory, net of
accumulated depreciation (exclusive of discounts, rebates, credits, incentive
payments and all other general intangibles relating thereto).
"Obligations" shall mean all liabilities and Debt of any kind and nature
whatsoever now or hereafter arising, owing, due or payable from Borrower (and/or
any of its Subsidiaries and Affiliates) to DFS, whether primary or secondary,
joint or several, direct, contingent, fixed or otherwise, secured or unsecured,
or whether arising under this Agreement, any other Loan Document or any other
agreement now or hereafter executed by Borrower (or any of its Subsidiaries or
Affiliates) and delivered to DFS. Obligations will include, without limitation,
any third party claims against Borrower (or any of its Subsidiaries or
Affiliates) satisfied or acquired by DFS. Obligations will also include all
obligations of Borrower to pay to DFS: (a) any and all sums reasonably advanced
by DFS to preserve or protect the Collateral or the value of the Collateral or
to preserve, protect, or perfect DFS' security interests in the Collateral; (b)
in the event of any proceeding to enforce the collection of the Obligations
after a Default, the reasonable expenses of retaking, holding, preparing for
sale, selling or otherwise disposing of or realizing on the Collateral, or
expenses of any exercise by DFS of its rights, together with reasonable
attorneys' fees, expenses of collection and court costs, as provided in the Loan
Documents; and (c) any other indebtedness or liability of Borrower to DFS,
whether direct or indirect, absolute or contingent, now or hereafter arising.
"Other Reports" shall have the meaning set forth in Section 2.11.3.
"Parts" shall mean all service and repair parts and accessories.
"Permitted Liens" shall mean: (a) Liens for taxes, assessments or other
governmental charges or levies not yet delinquent or which are being contested
in good faith by appropriate action and as to which adequate reserves shall have
been set aside in conformity with GAAP and which are, in addition, satisfactory
to DFS in its reasonable discretion; (b) Liens of mechanics, materialmen,
landlords, warehousemen, carriers and similar Liens arising in the future in the
ordinary course of business for sums not yet delinquent, or being contested in
good faith if a reserve or other appropriate provision in accordance with GAAP
shall have been made therefor and which are, in addition, satisfactory to DFS in
its reasonable discretion; (c) statutory Liens incurred in the ordinary course
of business in connection with workers' compensation, unemployment insurance,
social security, and similar items for sums not yet delinquent or being
contested in good faith, if a reserve or other appropriate provision in
accordance with GAAP shall have been made therefor and which are, in addition,
satisfactory to DFS in its reasonable discretion; (d) lessor's Liens arising
from operating leases entered into in the ordinary course of business; (e) Liens
arising from legal proceedings, so long as such proceedings are being contested
in good faith by appropriate proceedings, appropriate reserves have been
established therefor in accordance with GAAP and which are, in addition,
satisfactory to DFS in its reasonable discretion, and so long as execution is
stayed and bonded on appeal on all judgments resulting from any such
proceedings; (f) Liens, acceptable to DFS, in favor of other of Borrower's
secured parties, to the extent DFS has received an intercreditor/subordination
agreement in form and substance acceptable to DFS, in DFS' sole discretion, from
such other secured party; and (g) Liens in favor of DFS granted hereunder.
5
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
"Person" shall mean an individual, a partnership, a joint venture, a
corporation, a trust, a limited liability company, an unincorporated
organization, and a government or any department or agency thereof.
"Prime Rate" shall mean a fluctuating interest rate per annum equal to the
highest of the prime, base or reference rates of interest announced publicly
from time to time (whether or not charged in each instance) by The Chase
Manhattan Bank (or any successor thereof) as such bank's prime, base, or
reference rate per annum. For Floorplan Inventory Loans, the Prime Rate on the
last day of a month shall be the Prime Rate for the following month. For
Revolving Credit Loans, such Prime Rate will change and take effect on the day
when such change is announced. If The Chase Manhattan Bank discontinues the
practice of announcing or publishing a prime, base or reference rate during the
term of this Agreement, then DFS may, in its reasonable judgment, designate a
comparable bank and/or publicly announced rate to be thereafter used as a basis
for determining Prime Rate. Borrower acknowledges that The Chase Manhattan Bank
may extend credit at rates of interest less than its announced prime, base or
reference rate.
"Proceeds" means everything received upon the sale, lease, rental,
transfer to a third party or other disposition of Collateral.
"Revolving Credit Loan" shall have the meaning set forth in Section 2.3.
"Statement of Transaction" shall mean a written disclosure sent by DFS to
Borrower which sets forth, for each item of Floorplan Inventory and the
underlying Floorplan Inventory Loan with respect to such Floorplan Inventory:
the interest-free period to Borrower, if any; the annual percentage rate of
interest, if any; required reductions in principal, if any; and other financing
terms, if any.
"Subordinated Debt" shall have the meaning set forth in Section 9.2.
"Subsidiaries" shall mean any corporation other than Borrower in which a
Person owns or controls greater than 50% of the voting securities, or any
partnership or joint venture in which a Person owns or controls greater than 50%
of the aggregate equitable interest. The term "Subsidiary" means any one of the
Subsidiaries.
"Tangible Net Worth" shall have the meaning set forth in Section 9.2.
"Total Credit Limit" shall have the meaning set forth in Section 2.1.
"Total Revolving Credit Limit" shall have the meaning set forth in Section
2.3.
"UCC" shall mean the Uniform Commercial Code as in effect in the states
where the Collateral is located and the state where Borrower's chief executive
office is located, and any successor statutes, together with any regulations
thereunder, in each case as in effect from time to time. References to sections
of the UCC shall be construed to also refer to any successor sections.
"Unmatured Default" shall mean: (a) any Default under Subsections 11.1.1,
11.1.4, 11.1.9, 11.1.10, 11.1.11, 11.1.12, 11.1.14, 11.1.15 or 11.1.16, and (b)
the existence of any Excess Advance which, but for the passage of time or
notice, or both, under Subsection 2.4 hereof would be a Default.
"Value" shall mean, (a) with respect to Eligible New Inventory, Borrower's
original Cost (including inbound freight costs), (b) with respect to Eligible
Used Inventory, the NADA Wholesale Value from time to time; and (c) with respect
to Eligible Parts, the Borrower's Cost (excluding freight).
6
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
"Vendor" shall mean each of Brunswick Corporation and its marine
Subsidiaries, GenMar's Xxxxxx Cruisers division, Outboard Marine Corporation and
its marine Subsidiaries, and such other marine manufacturers and distributors as
DFS may approve in its reasonable discretion.
2. CREDIT FACILITY
2.1 Total Credit Facility. In consideration of Borrower's payment and
performance of its Obligations and subject to the terms and conditions contained
in this Agreement, DFS agrees to provide, and Borrower agrees to accept, an
aggregate credit facility (the "Credit Facility") of up to Sixty Million Dollars
($60,000,000) (the "Total Credit Limit"). The Credit Facility shall be available
in the form of Floorplan Inventory Loans and Revolving Credit Loans. No Loans
need be made by DFS if Borrower is in Default or if there exists any Unmatured
Default. This is an agreement regarding the extension of credit, and not the
provision of goods or services.
2.2 Floorplan Loans.
2.2.1 Inventory Floorplan Loan Limit. Subject to the terms of this
Agreement, DFS may provide Loans to Borrower for Floorplan Inventory and
financing approvals for Floorplan Inventory in transit from the Vendors
(each advance being a "Floorplan Inventory Loan") up to an aggregate
unpaid principal amount at any time not to exceed the difference between
(i) the Total Credit Limit less (ii) outstanding Revolving Credit Loans
("Floorplan Inventory Loan Limit"). DFS may, however, at any time and
without notice to Borrower, elect not to finance under a Floorplan
Inventory Loan any Inventory sold by particular Vendors who are in default
of their obligations to DFS. DFS may at any time suspend or terminate the
relationship or approval of any Vendor. DFS will use reasonable efforts to
attempt to give Borrower prior notice of such suspension or termination.
In the event that DFS suspends or terminates the relationship or approval
of any Vendor or, through no fault of Borrower, any Vendor suspends or
terminates the relationship or approval of DFS to provide manufacturer
subsidized financing, and such suspension or termination by either DFS or
any Vendor would have the effect of reducing the advance rate or requiring
Borrower to pay interest sooner on any Collateral under any Floorplan
Inventory Loan(s), then Borrower may inquire whether any other financing
source may finance the affected Inventory at a higher advance rate or
longer manufacturer subsidized period, and DFS may in its discretion (but
shall not be required to) allow Borrower to finance such Inventory with
such other financing source without Borrower paying DFS any penalty or
early termination fee provided that Borrower has exhausted reasonable
efforts to re-establish the previously suspended or terminated
relationship between DFS and such Vendor.
2.2.2 Payment Terms for Floorplan Inventory. Borrower will
immediately pay DFS the principal indebtedness owed DFS on each item of
Floorplan Inventory financed by DFS on the earliest occurrence of any of
the following events: (a) when such Floorplan Inventory is lost, stolen or
damaged to the extent that such loss, theft or damage is not adequately
insured under an insurance policy which names DFS as loss payee; or (b)
when such Floorplan Inventory is sold, transferred to a third party
(including a Subsidiary which is not a Borrower hereunder), otherwise
disposed of; or (c) at the end of the term for which DFS provides
financing for such Floorplan Inventory. If Borrower from time to time is
required to make immediate payment to DFS of any past due obligation
discovered during any Floorplan Inventory review, or at any other time,
Borrower agrees that acceptance of such payment by DFS shall not be
construed to have waived or amended the terms of its financing program.
Any third party discount, rebate, bonus or credit granted to Borrower for
any Floorplan Inventory will not reduce the debt Borrower owes DFS until
DFS has received payment therefor in cash. Borrower will: (1) pay DFS even
if any Floorplan Inventory is defective or fails to conform to any
warranties extended by any third party; (2) not assert against DFS any
claim or defense Borrower has against any third party; and (3) indemnify
and hold DFS harmless against all claims and defenses asserted by any
buyer or renter of the Floorplan Inventory relating to the condition of,
or any representations regarding, any of the Floorplan Inventory.
7
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
2.3 Revolving Credit Facility. Subject to the terms of this Agreement, DFS
agrees, for so long as no Default exists, to provide to Borrower working capital
financing (each advance being a "Revolving Credit Loan") on Eligible Accounts,
Eligible New Inventory, Eligible Used Inventory and Eligible Parts in the
maximum aggregate unpaid principal amount at any time not to exceed the lesser
of (a) the difference between (i) the Total Credit Limit, less (ii) outstanding
Floorplan Loans, and (b) the lesser of (i) the Borrowing Base and (ii)
Thirty-six Million Dollars ($36,000,000) ("Total Revolving Credit Limit"). A
request for a Revolving Credit Loan shall be made, or shall be deemed to be
made, as provided in Section 4.1 hereof.
2.3.1 Eligible Accounts. On receipt of each Borrowing Base
Certificate initially in the form set forth on Exhibit 2.3, and,
thereafter, in such form as DFS may reasonably require from time to time,
together with such supporting information as DFS may reasonably require
from time to time (the "Borrowing Base Certificate"), DFS will credit
Borrower with the lesser of (a) * of the net amount of the Eligible
Accounts which are listed in such Borrowing Base Certificate and (b) *
("Eligible Account Availability"). For purposes hereof, the net amount of
Eligible Accounts at any time shall be the face amount of such Eligible
Accounts less any and all returns, discounts (which may, at DFS' option,
be calculated on shortest terms), credits, rebates, allowances, or excise
taxes of any nature at any time issued, owing, claimed by Account Debtors,
granted, outstanding, or payable in connection with such Accounts at such
time.
2.3.2 Eligible New Inventory. On receipt of each Borrowing Base
Certificate, DFS will credit Borrower with a percent of the Value of
Borrower's Eligible New Inventory listed in such Borrowing Base
certificate (collectively the "Eligible New Inventory Availability") as
follows:
----------------------------------- -----------------------------------------
Number of Days Owned Percent of Value
----------------------------------- -----------------------------------------
----------------------------------- -----------------------------------------
* *
----------------------------------- -----------------------------------------
----------------------------------- -----------------------------------------
* *
----------------------------------- -----------------------------------------
----------------------------------- -----------------------------------------
* *
----------------------------------- -----------------------------------------
2.3.3 Eligible Used Inventory. On receipt of each Borrowing Base
Certificate, DFS will credit Borrower with the lesser of (a) * of the
Value of Borrower's Eligible Used Inventory listed in such Borrowing Base
Certificate, and (b) * ("Eligible Used Inventory Availability").
2.3.4 Eligible Parts. On receipt of each Borrowing Base
Certificate, DFS will credit Borrower with the lesser of (a) * of the
Value of Eligible Parts, and (b) * (such lesser amount being called the
"Eligible Parts Availability").
2.3.5 Payment Terms for Eligible Inventory. Borrower will pay DFS
the principal Debt on Eligible Inventory and Eligible Parts as provided in
Section 2.4, Mandatory Prepayment, and Section 3.1.1, Early Termination.
Borrower will also (1) make such payments on Eligible Inventory and
Eligible Parts even if any Inventory or Parts are defective or fail to
conform to any warranties extended by any third party; (2) not assert
against DFS any claim or defense Borrower has against any third party; and
(3) indemnify and hold DFS harmless against all claims and defenses
asserted by any buyer or renter of the Inventory or Parts relating to the
condition of, or any representations regarding, any of the Inventory or
Parts.
2.4 Mandatory Prepayment. If at any time and for any reason the aggregate
amount of outstanding Revolving Credit Loans exceeds the Borrowing Base or
aggregate outstanding Loans exceed the Total Credit Limit ("Excess Advances"),
________________________
*Indicates Confidential Treatment Requested. The redacted material has been
filed separately with the Commission.
8
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
Borrower will, within five (5) days after demand, repay an amount of the Loans
made to it by DFS hereunder equal to such excess. In addition, Borrower shall,
within five (5) days after demand by DFS, pay DFS whatever sums may be necessary
from time to time to remain in compliance with the Total Credit Limit, the Total
Revolving Credit Limit and the Floorplan Inventory Loan Limit, as such limits
may change from time to time, including, without limitation, as a result of any
Collateral no longer being deemed an Eligible Account, Eligible Inventory or
Eligible Parts, or as a result of any change in the Value of any Eligible
Inventory, or in the amount of any Eligible Account.
2.5 Interest; Calculation of Charges; Fees.
2.5.1 Interest - Floorplan Inventory Loans. Borrower will pay
interest to DFS on the Daily Floorplan Balance (as defined below) monthly
in arrears as and if provided for in any Statement of Transaction to which
Borrower does not object in writing to DFS within fifteen (15) days after
a Statement of Transaction is mailed to Borrower. If Borrower does not
object to a Statement of Transaction: (a) the amount shown on such
Statement of Transaction will, absent manifest error by DFS, be an account
stated; (b) Borrower will have agreed to all rates, charges and other
terms shown on such Statement of Transaction; (c) Borrower will have
agreed that the Lenders are financing the items of Inventory referenced in
such Statement of Transaction at Borrower's request; and (d) such
Statement of Transaction will be incorporated herein by reference, will be
made a part hereof as if originally set forth herein, and will constitute
an addendum hereto. If Borrower objects to a Statement of Transaction,
Administrative Agent of the Required Lenders may either require immediate
payment the Floorplan Inventory Loan represented by such Statement of
Transaction to which Borrower has objected, or charge Borrower interest on
such Floorplan Inventory Loan at the rates set forth below for, and as if
such Floorplan Inventory Loan was, a Loan and Revolving Credit Loan.
2.5.2 Interest - Revolving Credit Loans. Borrower will pay
interest to DFS on the Daily Contract Balance (as defined below) monthly
in arrears beginning on the Effective Date until all Revolving Credit
Loans are paid in full in good funds. Subject to Section 4.1.2, Borrower
may designate all Revolving Credit Loans for a particular calendar month
to be either (a) Prime Rate Loans, or (b) LIBOR Rate Loans; provided,
however, that Borrower must designate on or before the first Business Day
of each calendar month whether Revolving Credit Loans during such calendar
month will be Prime Rate Loans or LIBOR Rate Loans. Subject to Section
2.13 of this Agreement, interest on the Revolving Credit Loans shall be
calculated on the Average Daily Balance of Revolving Credit Loans at *
per annum.
2.5.3 Calculation of Charges. Such rates will: (i) be computed
based on a 360 day year; (ii) be calculated with respect to each day by
multiplying the Daily Rate (as defined below) by the Daily Contract
Balance; and (iii) accrue from the date DFS initiates any Electronic
Transfer (as defined in Section 2.5.4 below) or otherwise advances a Loan
to or for the benefit of Borrower, until DFS receives full payment of the
principal debt Borrower owes DFS in good funds.
2.5.4 Method of Transfer. Revolving Credit Loans will be made by
DFS if a request from Borrower is received before 12:00 noon St. Louis
time by same day Fed Funds Wire Transfer ("Fed Wire"), or if a request
from Borrower is received after such time, by Automated Clearing House
("ACH") (ACH and Fed Wire are collectively referred to as "Electronic
Transfers").
2.5.5 Definitions. The "Daily Rate" is the quotient of the
applicable annual rate provided herein for Revolving Credit Loans or in
any Statement of Transaction (for Floorplan Inventory Loans) divided by
360. The "Daily Contract Balance" is the amount of outstanding principal
debt which Borrower owes DFS on the Revolving Credit Loans, or Floorplan
Inventory Loans, at the end of each day (including the amount of all
Electronic Transfers) after DFS has credited payments which it has
received on the Revolving Credit Loans, or the Floorplan Inventory Loans.
The "Average Daily Balance" is the quotient of: (a) the sum of the
_____________________________
*Indicates Confidential Treatment Requested. The redacted material has been
filed separately with the Commission.
9
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
outstanding principal debt owed DFS on each day of a billing period for
Revolving Credit Loans, or the Floorplan Inventory Loans, divided by (b)
the actual number of days in such billing period.
2.5.6 Fees.
2.5.6.1 Non-Use of Credit Facility Fee. Borrower agrees to
pay DFS a non-use of credit facility fee of * per annum on the
daily average of the unused amount of the Revolving Credit Limit
during the term of this Agreement and any renewal term. Such non-
use fee shall be payable quarterly in arrears and due pursuant
to the monthly billing statement. Such unused amount of the
Revolving Total Credit Limit shall mean the difference between the
Revolving Credit Limit available to Borrower from time to time
and the Average Daily Balance of Revolving Credit Loans computed
at the beginning and end of each month.
2.5.6.2 Administration Fees. (a) Borrower agrees to pay DFS
an administration and review fee of * per month, in connection
with DFS' administration of this facility and the periodic review,
inspections and examinations made by DFS of the Inventory and
Parts. (b) Borrower agrees to pay DFS an review fee of * per day,
per person plus out of pocket expenses for each review, inspection
and examination of Borrower's Accounts and Borrower's books and
records relating to any or all of the Collateral (even if Borrower
has not borrowed against a particular category of Collateral).
Such fees shall be payable quarterly in arrears and due pursuant
to the applicable monthly billing statement. Borrower agrees that
such fees are not interest but rather reimburses DFS for its out-
of-pocket and allocated overhead expenses incurred in conducting
such audits, reviews and examinations.
2.6 Billing Statement. DFS will send Borrower a monthly billing statement
identifying all charges due on Borrower's account with DFS. The charges
specified on each billing statement will be: (a) due and payable by the
twentieth (20th) day of the month following the month for which the charges on
such Billing Statement apply; provided, however, that if such payment is not
timely received, DFS may make a Revolving Credit Loan to Borrower without a
request by Borrower to pay the unpaid amount of such Billing Statement; and (b)
an account stated, absent manifest error. DFS may adjust the billing statement
at any time to conform to applicable law and this Agreement.
2.7 Loan Proceeds. The parties intend that all indebtedness incurred
hereunder shall be governed exclusively by the terms of this Agreement and the
other Loan Documents, and shall not, unless requested by DFS, be evidenced by
notes or other evidences of indebtedness. Upon any such request, Borrower will
immediately execute and deliver any such note or other evidence reasonably
requested by DFS which is consistent with the terms of this Agreement. Any fees,
charges or expenses charged to DFS by any bank for payments made by DFS at
Borrower's request shall be immediately payable by Borrower. All advances and
other obligations of Borrower made hereunder will constitute a single
obligation.
2.8 Default Interest Rate. If a Default occurs under Subsections 11.1.1,
11.1.2 and/or 11.1.3, which is not cured within the applicable curing period,
DFS may then without prior demand, raise the rate of interest accruing on the
disbursed unpaid principal balance of any Loan by three percentage points (3%)
above the rate of interest otherwise applicable (the "Default Interest Rate"),
whether or not DFS elects to accelerate the unpaid principal balances as a
result of a Default. DFS will use reasonable efforts to attempt to notify
Borrower before imposing the Default Interest Rate Additionally, all Obligations
of Borrower described in clauses (a) and (b) of the definition thereof shall
bear interest at the Default Interest Rate.
_____________________________
*Indicates Confidential Treatment Requested. The redacted material has been
filed separately with the Commission.
10
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
2.9 Interest Rate After Certain Events. If a judgment is entered against
Borrower for sums due under any of the Obligations, as applicable, the amount of
the judgment entered (which may include principal, interest, reasonable
attorneys' fees and costs) shall bear interest at the judgment rate as permitted
under applicable law as of the date of entry of the judgment.
2.10 Verification Rights of DFS. DFS may, without notice to Borrower and
at any time or times hereafter verify the validity, amount or any other matter
relating to any Account by mail, telephone or other means, in the name of
Borrower or DFS.
2.11 Reports.
2.11.1 Biweekly Reports. Borrower agrees to provide to DFS by Noon
Eastern Time on Monday of every other week (commencing with the second
Monday after the Effective Date) a Borrowing Base certificate as of the
end of business on the previous Friday and Borrowing Base Certificate.
2.11.2 Monthly Reports. Borrower agrees to provide to DFS by the
fifteenth (15th) day of each month, or more frequently if requested by
DFS, in each case as of the last day of the immediately prior month, each
of the following: (a) Borrowing Base Certificate; (b) listing of each unit
of New Inventory and Used Inventory, together with the date of purchase
and Cost thereof; (c) listing of all Parts; and (d) aging of all accounts
receivable (the "Monthly Reports").
2.11.3 Updated Borrowing Base Certificates. Borrower will provide
DFS with updated Borrowing Base Certificates as required pursuant
to Section 4.1 hereof.
2.11.4 Covenant Compliance Certificates. Borrower will provide to
DFS Covenant Compliance Certificates as required pursuant to Section 9.3
hereof.
2.11.5 Other Reports. Borrower agrees to provide DFS any other
report or information reasonably requested by DFS within five (5) Business
Days after each request therefor by DFS (the "Other Reports").
2.11.6 Accuracy of Reports. The Biweekly Reports, Monthly Reports,
Borrowing Base Certificates and the Other Reports will be true and correct
in all respects. Borrower acknowledges DFS' reliance on the truthfulness
and accuracy of each Monthly Report, Borrowing Base Certificate and the
Other Reports.
2.12 Establishment of Reserves. (a) Notwithstanding the foregoing
provisions of Section 2.3, DFS shall have the right to establish reserves
against the value of any or all Collateral in such amounts, and with respect to
such matters, as DFS shall deem necessary or appropriate, against the amount of
Revolving Credit Loans which Borrower may otherwise request under Section 2.3,
including, without limitation, with respect to (i) price adjustments, damages,
unearned discounts, returned products or other matters for which credit
memoranda are issued in the ordinary course of Borrower's business; (ii)
shrinkage, spoilage and obsolescence of Inventory; (iii) slow moving Inventory;
(iv) other sums chargeable against Borrower as Revolving Credit Loans under any
section of this Agreement; and (v) such other matters, events, conditions or
contingencies as to which DFS, in its sole, reasonable credit judgment
determines reserves should be established from time to time hereunder.
(b) In the event that DFS establishes any reserves pursuant to the
foregoing paragraph which would have the effect of reducing the advance
rate on any Collateral from those set forth in Section 2.3, as it may be
amended from time to time by agreement of Borrower and DFS, then Borrower
may inquire whether any other financing source may finance the affected
Collateral at a higher advance rate, and DFS may in its discretion (but
shall not be required to) allow Borrower to finance such Collateral with
such other financing source without Borrower paying DFS any penalty or any
early termination fee.
11
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
2.13 Unavailability of LIBOR Rate; Capital Adequacy.
(a) LIBOR Rate Unascertainable. If DFS shall have determined
(which determination shall be conclusive and binding on the parties hereto) that
adequate and reasonable means do not exist for ascertaining the LIBOR Rate for
more than five (5) consecutive Business Days in a calendar month, then for the
remainder of such calendar month, or until the LIBOR Rate is again
ascertainable, whichever occurs first, the LIBOR Rate shall be replaced with a
rate of interest that is equal to (i) the Prime Rate per annum minus an
increment which sum is equivalent to the last LIBOR Rate determinable by DFS
("LIBOR Rate Equivalent"), plus (ii) the LIBOR Rate increment set forth in
Subsection 2.5.2 of this Agreement. If DFS shall have determined (which
determination shall be conclusive and binding on the parties hereto) that
adequate and reasonable means do not exist for ascertaining the LIBOR Rate for
less than five (5) consecutive Business Days in a calendar month, then the LIBOR
Rate for such days shall be the average of the LIBOR Rates for the day
immediately preceding and the day immediately following the period when the
LIBOR Rate was unascertainable.
(b) Certificate from DFS. A certificate of DFS claiming
entitlement to payment as set forth in this Section
2.13 shall be conclusive in the absence of manifest error. Such
certificate shall set forth the nature of the occurrence giving rise to such
payment, the additional amount or amounts to be paid to DFS, and the method by
which such amounts were determined. In determining such amount, DFS may use any
reasonable averaging and attribution methods.
2.14 Collections. Borrower will, as long as any Loans remain outstanding,
notify all obligors to remit all collections on Accounts to a bank account or
bank accounts designated by DFS ("Lockbox"). All funds in such bank accounts may
be used by Borrower until an Unmatured Default occurs or any other Default
occurs and is not cured within the applicable curing period. After an Unmatured
Default occurs or any other Default occurs and is not cured within the
applicable curing period, at the discretion of DFS all funds in such bank
accounts may immediately become the property of DFS. Borrower shall obtain the
agreement of such banks to waive any offset rights against the funds so
deposited. Until delivery to such bank account(s), Borrower will keep such
remittances separate and apart from Borrower's own funds so that they are
capable of identification. Upon the occurrence of an Unmatured Default or the
occurrence of any other Default which is not cured within the applicable curing
period, all such funds not immediately deposited into such bank account(s) will
also be held in trust for DFS. Upon the occurrence of an Umatured Default or
following any other Default which is not cured within the applicable curing
period, unless and until DFS' notifies Borrower, such bank(s) and Account
Debtors to the contrary, DFS may: (i) notify such bank(s) to only process
withdrawals, checks, drafts and other transfers requested by DFS, and (ii)
notify any Account Debtor of the assignment of Accounts and collect the same.
All proceeds received or collected by DFS with respect to Accounts, and reserves
and other property of Borrower in possession of DFS at any time or times
hereafter, may be held by DFS without interest to Borrower until all Obligations
are paid in full or applied by DFS on account of the Obligations. DFS may
release to Borrower such portions of such reserves and proceeds as DFS may
determine.
2.15 Advancements. If Borrower fails to (a) perform any of the affirmative
covenants contained herein, (b) protect or preserve the Collateral or (c)
protect or preserve the status and priority of the Liens and security interest
of DFS in the Collateral, DFS may make advances to perform those obligations.
DFS will use reasonable efforts to give Borrower notice prior to making such
advancement. All sums so advanced will be due and payable upon demand and will
immediately upon advancement become secured by the security interests created by
this Agreement and will be subject to the terms and provisions of this Agreement
and all of the Loan Documents. DFS may add all sums so advanced, plus any
reasonable expenses or costs incurred by DFS, including reasonable attorney's
fees, as outstanding Loans as DFS may designate in its sole discretion. The
provisions of this Section will not be construed to prevent the institution of
rights and remedies of DFS upon the occurrence of a Default. Any provisions in
this Agreement to the contrary notwithstanding, the authorizations contained in
12
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
this Section will impose no duty or obligation on DFS to perform any action or
make any advancement on behalf of Borrower and are for the sole benefit and
protection of DFS.
2.16 Continuing Requirements - Accounts. Borrower will not permit or agree
to any extension in excess of sixty (60) days, compromise or settle or make any
change to any Account except in the ordinary course of business. Upon the
occurrence of an Umatured Default or following any other Default which is not
cured within the applicable curing period, Borrower will: (a) if from time to
time required by DFS, immediately upon their creation, deliver to DFS reprints
of all invoices, delivery evidences and other such documents relating to each
Account; (b) affix appropriate endorsements or assignments upon all such items
of payment and proceeds so that the same may be properly deposited by DFS to
DFS' account; (c) immediately notify DFS in writing which Accounts may be deemed
Ineligible Accounts; and (d) xxxx all chattel paper and instruments now owned or
hereafter acquired by it to show that the same are subject to DFS' security
interest and immediately thereafter deliver such chattel paper and instruments
to DFS with appropriate endorsements and assignments to DFS.
2.17 Performance Reserve. During each calendar month during the term of
this Agreement, DFS agrees to set aside an amount equal to * of the average
daily balance during the prior calendar month (using the beginning of the month
balance and end of the month balance and dividing by 2) *. DFS will, under the
conditions set forth below, apply the Reserve Amount accumulated monthly during
a calendar year against Borrower's amounts owed to DFS for interest which
accrues after March 31 of the calendar year following the year in which the
Performance Reserve accumulated; provided that at the time any such Performance
Reserve is so applied, Borrower is then still financing all Inventory through
DFS or other lenders approved by DFS in its sole discretion.
2.17.1 Conditions Precedent. In order for DFS to apply the
Performance Reserve against Borrower's interest obligations to DFS as
provided in Section 2.17, Borrower: (a) must be in good standing with
DFS, and not in default, as of the date that each part of the
Performance Reserve is otherwise to be applied, and (b) must finance all
of its inventory through DFS or other lenders approved by DFS in its
sole discretion during the calendar year during which the Performance
Reserve is accumulated and through the date that each part of the
Performance Reserve is otherwise to be applied.
2.17.2 Use of the Performance Reserve. DFS may use such
Performance Amount as security for Borrower's indebtedness to DFS unless
and until DFS is required to apply the Performance Reserve against
Borrower's interest obligations to DFS, and Borrower further agrees with
DFS as follows: (a) DFS will hold and account for the Performance
Reserve in a separate reserve account maintained in the books and
records of DFS (the "Reserve Account"), although nothing herein shall be
construed to require that DFS actually open and maintain an independent
account with any third-party financial institution in respect thereof.
(b) Upon the occurrence of any Default under Sections 11.1.1, 11.1.2,
11.1.3, 11.1.4, 11.1.10 or 11.1.12 hereof, DFS may immediately recoup,
setoff and apply against Borrower's indebtedness to DFS hereunder any
and all amounts so held in the Reserve Account. DFS agrees to send
written notice thereof to Borrower upon such application by DFS.
Borrower acknowledges, however, that the existence and maintenance of
the Reserve Account does not relieve Borrower of any obligations to DFS
hereunder. (c) As security for all Borrower's obligations to DFS under
this Agreement, Borrower pledges and grants to DFS a security interest
in all amounts held from time to time in the Reserve Account, whether
held or classified in whole or in part as accounts, deposit accounts,
money, contract rights, instruments, general intangibles and/or
otherwise. (d) If Borrower has failed to finance all of its Inventory
with DFS during a calendar year (except as approved by DFS in writing),
or is not financing all of its Inventory with DFS (except as approved by
DFS in writing) as of the date that any part of the Performance Reserve
would otherwise be applicable, DFS may take and apply any and all
amounts held in the Reserve Account as DFS may desire. DFS shall have no
obligation to apply any such amount to any indebtedness owed by Borrower
to DFS.
______________________________
*Indicates Confidential Treatment Requested. The redacted material has been
filed separately with the Commission.
13
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
3. TERM OF AGREEMENT
3.1 Termination. This Agreement will continue in full force and effect and
be non-cancelable for three (3) years from the Effective Date (except that it
may be terminated by DFS in the exercise of its rights and remedies upon Default
by Borrower) and shall be subject to one-year renewal periods thereafter if both
DFS and Borrower agree to renew this Agreement.
3.1.1 Early Termination. Notwithstanding anything in this Section
3 to the contrary Borrower may terminate this Agreement prior to such date
if Borrower: (a) gives DFS at least 90 days written notice to DFS; (b)
pays to DFS all Obligations; and (c) pays to DFS an amount equal to:
Date of
Termination Amount
----------- ------
On or prior to the first *
anniversary of the
Effective Date
After the first anniversary *
of the Effective Date through
the second anniversary of the
Effective Date
After the second anniversary *
of the Effective Date through the
third anniversary of the Effective date
No such early termination fee will be payable if: (1) this Agreement is
terminated at the request of the Borrower at any time within ninety (90)
days prior to the third anniversary of the Effective Date or (2) due to
any Default other than a financial covenant default under Section 11.1.8
hereof. However, such fee will be payable by Borrower if this Agreement is
terminated on account of Borrower taking any action(s), or failing to take
any action(s), which Borrower knew or reasonably should have known at the
time that such action(s) or inaction would directly or indirectly cause or
result in a Default pursuant to Section 11.1.8 hereof, unless DFS agrees
to waive such fee. Termination on any date other than the anniversary date
will not entitle Borrower to a refund of any fee. DFS shall be entitled to
payment of all fees upon Default by Borrower which would have been payable
during the original term of this Agreement, or any extension thereof, but
for such early termination (provided, however, that if DFS is paid in full
audit and appraisal fees will be waived for audits and appraisal not then
begun). These accelerated fees represent liquidated damages and are not a
penalty. Any such written notice of termination delivered by Borrower and
to DFS shall be irrevocable. Notwithstanding anything in Sections 2.2.1 or
2.12 to the contrary, it is understood that Borrower may elect to
terminate this Agreement in its entirety only, no section or lending
facility may be terminated singly.
3.2 Effect of Termination. Borrower will not be relieved from any
Obligations to DFS arising out of DFS' advances or commitments made before the
effective termination date of this Agreement. DFS will retain all of its rights,
______________________________
*Indicates Confidential Treatment Requested. The redacted material has been
filed separately with the Commission.
14
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
interests and remedies hereunder until Borrower has paid all of Borrower's
Obligations to DFS. All waivers set forth within this Agreement will survive any
termination of this Agreement.
4. BORROWING AND REPAYMENT PROCEDURES
4.1. Borrowing Procedures.
4.1.1 Generally. A request for a Revolving Credit Loan shall be made, or
shall be deemed to be made, in the following manner: (a) Borrower may give DFS
written notice of its intention to borrow, in which notice Borrower shall
specify the amount of the proposed borrowing and the proposed borrowing date;
(b) the becoming due of any amount required to be paid under this Agreement as
interest shall be deemed irrevocably to be a request for a Revolving Credit Loan
on the due date in the amount required to pay such interest; and (c) the
becoming due of any other Obligations shall be deemed irrevocably to be a
request for a Revolving Credit Loan on the due date in the amount then so due.
For purposes of subpart (a) above, Borrower agrees that DFS may rely and act
upon any request for a Revolving Credit Loan from any individual who DFS, absent
gross negligence or willful misconduct, believes to be a representative of
Borrower. Borrower will monitor the Borrowing Base and submit to DFS an updated
Borrowing Base Certificate if the Borrowing Base does not equal or exceed the
Revolving Credit Loan request.
4.1.2 Loan Options. Each Revolving Credit Loan shall be either a
Prime Rate Loan or a LIBOR Rate Loan as shall be selected by the Borrower,
except as otherwise provided herein. During any period that any Default or
Unmatured Default shall occur and be continuing, Borrower shall no longer
have the option of electing LIBOR Loans, and all Loans made during such
period shall be Prime Rate Loans only; it being understood, however, that
in such event nothing herein shall be construed to waive, amend or modify
any right or power of DFS hereunder, including, without limitation, all
rights to terminate the credit facilities hereunder and declare all
Obligations immediately due and payable.
4.1.3 Conditions Precedent to Each Loan. Without limiting the
applicability of the conditions precedent set forth in Section 6 below to
DFS' obligation to make any Loan, the obligation of DFS to make any Loan
shall be subject to the further conditions precedent that, on the date of
each such Loan:
4.1.3.1 The following statements shall be true: (a) the
representations and warranties contained in Section 7 hereof are
materially correct (except that the representations and warranties
contained in Section 7.5, Title to Collateral, Section 7.7,
Subsidiaries, Section 7.9, Place of Business, Section 7.17,
Location of Collateral, Section 7.20, Solvency, and Section 7.23,
Reaffirmation, shall be absolutely true and correct) on and as of
the date of such Loan as though made on and as of such date, and
(b) there exists no Default or Unmatured Default, nor would any
Default or any Unmatured Default result from the making of the
Loan requested by Borrower;
4.1.3.2 Borrower shall have signed and sent to DFS, if DFS
so requests, a request for advance, setting forth in writing the
amount of the Revolving Credit Loan requested; provided, however,
that the foregoing condition precedent shall not prevent DFS, if
it so elects, in its sole discretion, from making a Revolving
Credit Loan pursuant to Borrower's non-written request therefor;
4.1.3.3 DFS shall have received such other approvals,
opinions or documents as it may reasonably request.
Borrower agrees that the making of a request by Borrower for a Loan, shall
constitute a certification by Borrower and the Person(s) executing or
giving the same that all representations and warranties of Borrower herein
(other than under Sections 7.5, 7.7, 7.9, 7.17, 7.20, and 7.23 which shall
15
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
be absolutely true and correct) are materially true as of the date thereof
and that all required material conditions to the making of the Loan have
been met.
4.2 All Loans One Obligation. All Obligations of Borrower to DFS under
this Agreement and all other agreements between Borrower and DFS shall
constitute one obligation to DFS secured by the security interest granted in
this Agreement, and by all other Liens heretofore, now, or at any time or times
hereafter granted by Borrower. All of the rights of DFS set forth in this
Agreement shall apply to any modification of or supplement to this Agreement, or
Exhibits hereto, unless otherwise agreed in writing.
4.3 Payments of Principal and Interest. All payments and amounts due
hereunder by Borrower shall be made or be payable without set-off or
counterclaim and shall be made to DFS on the date due at its office(s)
responsible for Borrower's account, or at such other place which DFS may
reasonably designate to Borrower in writing. Whenever any payment to be made
hereunder shall be stated to be due on a date other than a Business Day, such
payment may be made on the next succeeding Business Day, and such extension of
time shall be included in the computation of payment of interest or any fees and
shall not result in a late payment fee.
4.4 Collection Days. All payments and all amounts received hereunder will
be credited by DFS to Borrower's account (a) on the day good funds are received
by Fed Wire transfer or ACH or (b) two (2) Business Days after deposit of a
paper check into DFS' bank account.
5. SECURITY FOR THE OBLIGATIONS
5.1 Grant of Security Interest. To secure payment of all of Borrower's
current and future Obligations and to secure Borrower's performance of all of
the provisions under this Agreement and the other Loan Documents, Borrower
grants DFS a security interest in all of Borrower's inventory, accounts,
contract rights, chattel paper, security agreements, instruments, deposit
accounts, reserves, documents and general intangibles; and all judgments,
claims, insurance policies, and payments owed or made to Borrower thereon; all
whether now owned or hereafter acquired, all attachments, accessories,
accessions, parts, returns, repossessions, exchanges, substitutions and
replacements thereto, and all proceeds thereof. All such assets are collectively
referred to herein as the "Collateral." All such terms for which meanings are
provided in the Uniform Commercial Code are used herein with such meanings. All
Collateral financed by DFS or against which DFS has loaned monies, and all
proceeds thereof, will be held in trust by Borrower for DFS, with such proceeds
being payable in accordance with this Agreement. Borrower covenants with DFS
that DFS may realize upon all or part of any Collateral in any order it desires
and any realization by any means upon any Collateral will not bar realization
upon any other Collateral. Borrower's liability under this Agreement is direct
and unconditional and will not be affected by the release or nonperfection of
any security interest granted hereunder.
5.2 Future Advances. DFS' security interests shall secure all current and
all future advances to Borrower made by DFS under the Loan Documents.
5.3 Financing Statements. Borrower shall execute and deliver to DFS for
the benefit of DFS such financing statements, certificates of title and original
documents as may be reasonably required by DFS with respect to DFS' security
interests.
5.4 Further Assurances. Borrower will execute and deliver to DFS, at such
time or times as DFS may request, all financing statements, security agreements,
assignments, certificates, affidavits, reports, schedules, and other documents
and instruments that DFS may reasonably deem necessary to perfect and maintain
perfected DFS' security interests in the Collateral and to fully consummate the
transactions contemplated under all Loan Documents. All reasonable filing,
recording or registration fees shall be payable by Borrower.
16
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
6. CONDITIONS PRECEDENT
All duties and obligations of DFS under the Loan Documents on the
Effective Date, are specifically subject to the full satisfaction by Borrower of
the conditions precedent set forth below. All duties and obligations of DFS
under the Loan Documents during the term of this Agreement are specifically
subject to the full and continued satisfaction by Borrower of the conditions set
forth in Sections 6.1.2, 6.1.3, 6.1.4 and 6.1.5.
6.1 Conditions Precedent. The following conditions must be satisfied as
of the date DFS makes its first advance of funds to or for the benefit of
Borrower under this Agreement ("First Funding Date"):
6.1.1 DFS' Counsel. DFS' counsel must approve of all matters
pertaining to (a) title to the Collateral; (b) the form, substance and due
execution of all Loan Documents; (c) Borrower's organizational documents;
and (d) all other legal matters, including the application of any laws
relating to usury.
6.1.2 No Material Adverse Change. There must not have been any
Material Adverse Change, between September 30, 1998 and the First Funding
Date, or between the First Funding Date and the date on which any
subsequent advance is made in the condition of Borrower, the condition of
the Business, the value and condition of the Collateral, the structure of
Borrower other than as contemplated herein, or in the financial
information, audits and the like obtained by DFS.
6.1.3 Perfected Liens. DFS shall have a perfected first priority
Lien and security interest in (a) all Inventory of Borrower, (b) all
Proceeds of such Inventory and all Accounts of Borrower, subject only to
the Permitted Liens.
6.1.4 Insurance. Borrower shall provide DFS with certificates of
insurance evidencing that Borrower has obtained the insurance as required
in Section 8.1.2.
6.1.5 Laws. Borrower and its Subsidiaries shall be in compliance
with all applicable laws and governmental regulations, including, but not
limited to, all Environmental Laws, the failure to comply with which would
have a material adverse change on Borrower, its Subsidiaries or the
Business.
6.1.6 Certificate of Good Standing. A certificate of good standing
for Borrower (or other similar certificate) must be delivered to DFS, from
the appropriate governmental authority of Borrower's state of
incorporation and other jurisdictions in which Borrower does business,
dated not earlier than 30 days prior to the Effective Date.
6.1.7 Opinion of Borrower's Counsel. DFS must receive a written
opinion from counsel for Borrower, as of the First Funding Date, and
addressed to and for the benefit of DFS, in form and substance
satisfactory to DFS.
6.1.8 UCC Searches. DFS must receive a certificate from a provider
of financing statement searches acceptable to DFS which identifies all
financing statements of public record not more than 5 Business Days before
the First Funding Date, that pertain to the Collateral.
6.1.9 Other Documents. Such other documents, guaranties,
certificates, submissions, insurance policies and other matters as
reasonably requested by DFS relating to the transaction herein
contemplated.
6.1.10 President's Certificate. In the form attached hereto as
Exhibit 6.1.10 compliance with all of the terms and conditions in the
Loan Documents.
6.1.11 Articles of Incorporation. A certified copy of the Articles
of Incorporation, By-Laws and the resolutions of the directors of Borrower
authorizing the transactions contemplated by this Agreement.
17
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
6.1.12 Secretary's Certificate of Resolution and Incumbency. In
the form attached hereto as Exhibit 6.1.12.
6.1.13 Pre-closing Expenses. Borrower shall pay to DFS all
reasonable fees and expenses required under this Agreement that are due
on or before the Effective Date, if any.
6.1.14 Pre-closing Reviews. DFS must complete reviews with
satisfactory results of Borrower's Inventory and Accounts.
6.1.15 Payoff Letters. A lien release and payoff letter executed
by any and all lienholders on any of the Collateral, other than with
respect to the Permitted Liens.
7. REPRESENTATIONS AND WARRANTIES
To induce DFS to enter into this Agreement, Borrower makes the
representations and warranties set forth below, all of which will remain true in
all material respects during the term of this Agreement. Borrower acknowledges
DFS' justifiable right to rely upon the representations and warranties set forth
below.
7.1 Financial Statements. Borrower's audited financial statements as of
September 30, 1998 and September 30, 1997 and Borrower's unaudited financial
statement as of June 30, 2000, copies of which have been previously submitted to
DFS, have been prepared in conformity with GAAP and present fairly the financial
condition of Borrower and its consolidated Subsidiaries as at such dates and the
results of their operations for the periods then ended. Borrower warrants and
represents to DFS that all financial statements and information relating to
Borrower or any Guarantor which have been or may hereafter be delivered by
Borrower or any Guarantor are true and correct and have been and will be
prepared in accordance with GAAP and, with respect to such previously delivered
statements or information, there has been no material adverse change in the
financial or business condition of Borrower or any Guarantor since the
submission to DFS, either as of the date of delivery, or, if different, the date
specified therein, and Borrower acknowledges DFS' reliance thereon.
7.2 Non-Existence of Defaults. Neither Borrower nor any of its
Subsidiaries is in default with respect to any material amount of its existing
Debt. The making and performance of this Agreement and all other Loan Documents,
will not immediately, or with the passage of time, the giving of notice, or
both: (a) violate the provisions of the bylaws or any other corporate document
of Borrower; (b) violate any laws to the best of Borrower's knowledge after
diligent inquiry; (c) result in a material default under any contract,
agreement, or instrument to which Borrower is a party or by which Borrower or
its properties are bound; or (d) result in the creation or imposition of any
security interest in, or Lien or encumbrance upon, any of the Collateral except
the Permitted Liens.
7.3 Litigation. Set forth on Exhibit 7.3 is a list of all actions, suits,
investigations or proceedings pending or, in the knowledge of Borrower,
threatened against Borrower or any of its Subsidiaries, as of the date hereof in
which there is a reasonable probability of an adverse decision which would
materially and adversely affect Borrower, the Business, or the Collateral.
7.4 No Material Adverse Changes. Borrower does not know of or expect any
Material Adverse Change in the Business, or in Borrower's or any of the
Subsidiaries' assets, liabilities, properties, or condition, financial or
otherwise, including changes in Borrower's financial condition prior to and
inclusive of the earlier of (a) the latest proposal or terms sheet or (b) DFS'
last audit prior to the Effective Date.
7.5 Title to Collateral. Except as set forth on Exhibit 7.5, Borrower has
good and marketable title to all of the Collateral, free and clear of any and
all Liens, claims and encumbrances, other than the Permitted Liens.
18
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
7.6 Corporate Status. Borrower and each of the Subsidiaries is a
corporation duly organized and validly existing, in good standing, with
perpetual corporate existence, under the laws of their respective jurisdictions
of formation. Borrower and its Subsidiaries have the corporate power and
authority to own their properties and to transact the Business in which they are
engaged and presently propose to engage. Borrower and each Subsidiary is duly
qualified as a foreign corporation and in good standing in all states where the
nature of their Business or the ownership or use of their property requires such
qualification, and where failure to so qualify would have a material adverse
change on its Business, operations or financial condition.
7.7 Subsidiaries. Exhibit 7.7 hereto lists the Subsidiaries as of the
Effective Date.
7.8 Power and Authority. Borrower has the corporate power to borrow and to
execute, deliver and carry out the terms and provisions of the Loan Documents.
Borrower has taken or caused to be taken all necessary corporate action to
authorize the execution, delivery and performance of this Agreement and all
other Loan Documents and the borrowing thereunder.
7.9 Principal Place of Business. Each Borrower's chief executive office
and principal place of business is located at the address set forth on Exhibit
7.9 attached hereto. Borrower's records concerning the Collateral are kept at
such chief executive office, or will be kept at such other place that Borrower
informs DFS of not less than 30 days in advance of relocation.
7.10 Enforceability of the Loan Documents. The Loan Documents executed by
Borrower are the valid and binding obligations of Borrower and are enforceable
against Borrower in accordance with their terms, except as limited by
bankruptcy, insolvency, or other laws of general application relating to the
enforcement of creditors' rights.
7.11 Taxes. Each Borrower's federal tax identification number is listed on
Exhibit 7.11 attached hereto. Borrower has: (a) filed all federal, state and
local tax returns and other reports that it is required by law to file, (b) paid
or caused to be paid all taxes, assessments and other governmental charges that
are due and payable, the failure of which to pay would have a material adverse
change on the Business, except those contested in good faith and in accordance
with accepted procedures, and for which adequate reserves have been established
in accordance with GAAP, and (c) made adequate provision for the payment of such
taxes, assessments or other charges accruing but not yet payable. Borrower has
no knowledge of any deficiency or additional assessment in a material amount in
connection with any taxes, assessments or charges.
7.12 Compliance with Laws. Borrower, to the best of its knowledge after
diligent inquiry, has complied, and shall cause each Subsidiary to comply, in
all material respects with all applicable laws, including any Environmental Laws
and any zoning laws, the failure to comply with which would have a material
adverse change on Borrower individually, or Borrower and its Subsidiaries on a
consolidated basis.
7.13 Consents. Borrower and the Subsidiaries have obtained all material
consents, permits, licenses, approvals or authorization of, or effected the
filing, registration or qualification with, any governmental entity which is
required to be obtained or effected by Borrower and the Subsidiaries in
connection with the Business or the execution and delivery of this Agreement and
the other Loan Documents the failure of which to obtain or effect would have a
material adverse change on Borrower individually, or on Borrower and its
Subsidiaries on a consolidated basis.
7.14 Purpose. Borrower will use the advances which DFS makes under the
Credit Facility solely for lawful purposes and as described in Section 2 hereof.
19
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
7.15 Condition of the Business. All material assets used in the conduct of
the Business are in good operating condition and repair and are fully usable in
the ordinary course thereof, reasonable wear and tear excepted.
7.16 Capital. All issued shares and all outstanding shares in the
Subsidiaries as reflected in Borrower's financial statements are validly issued
pursuant to proper authorization of the board of directors of such Subsidiary,
and are fully paid, and non-assessable. All Borrower's and Subsidiary's issued
shares and outstanding capital stock are fully paid and non-assessable.
7.17 Location of Collateral. Exhibit 7.17 describes the locations where
any of the Collateral is located or stored as of the date hereof.
7.18 Real Property. Neither Borrower nor any Subsidiary own or lease any
real property, except as set forth on Exhibit 7.18 attached hereto.
7.19 Warranties and Representations-Accounts. For each Account listed by
Borrower on any Borrowing Base Certificate, Borrower warrants and represents to
DFS that at all times: (a) such Account is genuine; (b) such Account is not
evidenced by a judgment or promissory note or similar instrument or agreement;
(c) to the best of Borrower's knowledge, it represents a bona fide transaction
completed in accordance with the terms of the invoices and purchase orders
relating thereto; (d) to the best of Borrower's knowledge, the goods sold or
services rendered which resulted in the creation of such Account have been
delivered or rendered to and not rejected by the Account Debtor; (e) the amounts
shown on the Borrowing Base Certificate, Borrower's books and records and all
invoices and statements delivered to DFS with respect thereto are owing to
Borrower and are not contingent; (f) no payments have been or will be made
thereon except payments deposited into the Lockbox; (g) to the best of
Borrower's knowledge, there are no offsets, counterclaims or disputes existing
or asserted with respect thereto and Borrower has not made any agreement with
the Account Debtor for any deduction or discount of the sum payable thereunder
except regular discounts allowed by Borrower in the ordinary course of its
business for prompt payment; (h) to the best of Borrower's knowledge, there are
no facts or events which in any way impair the validity or enforceability
thereof or reduce the amount payable thereunder from the amount shown on the
Borrowing Base Certificate, Borrower's books and records and the invoices and
statements delivered to DFS with respect thereto; (i) to the best of Borrower's
knowledge, all persons acting on behalf of the Account Debtor thereon have the
authority to bind the Account Debtor; (j) the Accounts arising from goods sold
or transferred giving rise thereto are not subject to any Lien, claim,
encumbrance or security interest which is superior to that of DFS; (k) such
Account is subject to DFS' perfected, first priority security interest and no
other Lien other than a Permitted Lien; and (l) there are no proceedings or
actions known to Borrower which are threatened or pending against the Account
Debtor thereon which might result in any material adverse change in such Account
Debtor's financial condition.
7.20 Solvency. The Borrower and each of the Subsidiaries now has capital
sufficient to carry on its respective business and transactions and all business
and transactions in which it is about to engage and is now solvent and able to
pay its respective debts as they mature, and Borrower and each of the
Subsidiaries now owns property having a value, greater than the amount required
to pay Borrower's or such Subsidiary's debts.
7.21 Business Locations; Agent for Process. Borrower has no office or
place of business located in any state or county other than as shown Exhibit
7.17.
7.22 Warranties and Representations-Inventory & Parts. For each item of
Inventory and Parts listed by Borrower on any Borrowing Base Certificate,
Borrower covenants, warrants and represents to DFS that at all times: (a) except
for rental Inventory and Inventory on exhibition and/or demonstration to buyers
or lessees in the ordinary course of business, all Inventory and Parts will be
kept only at the locations indicated on Exhibit 7.17; (b) Borrower now keeps and
will keep correct and accurate records itemizing and describing the kind, type,
20
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
quality and quantity of Inventory and Parts, Borrower's cost therefor and the
selling price thereof, the daily withdrawals therefrom and the additions
thereto; (c) Parts and Inventory not on rent are not and will not be stored with
a bailee, repairman, warehouseman or similar party without DFS' prior written
consent, and Borrower will, concurrently with delivery to such party, cause any
such party to issue and deliver to DFS, in form acceptable to DFS, warehouse
receipts, in DFS' name evidencing the storage of such Inventory and parts, and
waivers of warehouseman's liens in favor of DFS; (d) Borrower will pay all
taxes, rents, business taxes, and the like on the premises where the Inventory
and Parts are located; and (e) Borrower will not lend, demonstrate, pledge,
consign, transfer or secrete any of the Inventory or Parts or use any of the
Inventory or Parts for any purpose other than exhibition and/or demonstration
for sale to buyers or rental to lessees in the ordinary course of business,
without DFS' prior written consent.
7.23 Reaffirmation. Each request for a Loan made by Borrower pursuant to
this Agreement or any of the other Loan Documents shall constitute (a) an
automatic representation and warranty by Borrower to DFS that there does not
then exist any Default or any Unmatured Default, and (b) a reaffirmation as of
the date of said request of all of the representations and warranties of
Borrower contained in this Agreement and the other Loan Documents.
7.24 Survival of Representations and Warranties. Borrower covenants,
warrants and represents to DFS that all representations and warranties of
Borrower contained in this Agreement or any of the other Loan Documents shall be
materially true at the time of Borrower's execution of this Agreement and the
other Loan Documents, and shall survive the execution, delivery and acceptance
thereof by DFS and the parties thereto and the closing of the transactions
described therein or related thereto.
8. BORROWER'S COVENANTS
8.1 Affirmative Covenants. During the term of this Agreement and
thereafter for so long as any Obligations are outstanding and unpaid, Borrower
covenants that unless otherwise consented to by DFS in writing, it shall perform
all the acts and promises required by this Agreement and all the acts and
promises set forth below.
8.1.1 Payment and Performance. Borrower will pay and perform all
Obligations in full when and as due hereunder.
8.1.2 Insurance.
8.1.2.1 Type of Insurance. Borrower will at all times cause
the Business and the Collateral to be insured by insurers of
reasonable financial soundness and having an A. M. Best rating of
A or better, with such policies, against such risks and in such
amounts as are appropriate for reasonably prudent businesses in
Borrower's industry and of Borrower's size and financial strength.
8.1.2.2 Requirements as to Insurance Policies. The policies
of insurance which Borrower is required to carry shall comply with
the requirements listed below:
(a) Each such policy shall provide that it may not be
canceled or allowed to lapse at the end of a policy period without
at least 30 days' prior written notice to DFS;
(b) Each property insurance policy shall contain lender's
loss payable endorsements satisfactory to DFS providing, among
other things, that any loss shall be payable in accordance with
the terms of such policy notwithstanding any act of Borrower which
might otherwise result in forfeiture of such insurance and shall
also be evidenced by an Accord 27 Evidence of Property Insurance;
21
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
8.1.2.3 Collection of Claims. Borrower will promptly advise
DFS of any insured casualty and Borrower agrees that DFS may
direct all insurance proceeds therefrom to be paid directly to DFS
to the extent that such loss is not adequately insured under an
insurance policy which names DFS as a loss payee, and hereby
appoints DFS its attorney-in-fact for such purpose.
8.1.2.4 Blanket Policies. Any insurance required hereunder
may be supplied by means of a blanket or umbrella insurance
policy.
8.1.2.5 Delivery of Policies or Certificates of Insurance.
Borrower shall deliver to DFS certificates of insurance issued by
insurers to evidence that the insurance maintained by Borrower
complies with the requirements hereunder.
8.1.3 Collection of Receivables; Sale of Inventory. Borrower will
collect its Accounts and sell its Inventory only in the ordinary course of
business, unless written permission to the contrary is obtained from DFS.
8.1.4 Notice of Litigation and Proceedings. Borrower will give
prompt notice to DFS of: (a) any actual or threatened litigation or
proceeding (including fines and penalties of any public authority) in
which it or any of the Subsidiaries is a party in which there is a
reasonable probability of an adverse decision which would require it or
any of the Subsidiaries to pay money or deliver assets in excess of One
Million Dollars ($1,000,000), whether or not the claim is considered to be
covered by insurance; (b) any class action litigation against it,
regardless of size; and (c) the institution of any other suit or
proceeding that might materially and adversely affect its or any of its
Subsidiary's operations, financial condition, property or the Business.
8.1.5 Payment of Debt to Third Persons. Borrower will, and will
cause each Subsidiary to, pay, within 30 days after due date, all Debt and
any other liability due third persons, except when the amount thereof is
being contested in good faith by appropriate proceedings and with adequate
reserves therefor in accordance with GAAP being set aside by Borrower or
such Subsidiary.
8.1.6 Notice of Change of Business Location. Borrower will notify
DFS 30 days in advance of: (a) any change in or discontinuation of the
location of the Collateral, Borrower's principal place of business, or any
of the Subsidiaries' existing offices or places of business, (b) the
establishment of any new places of business relating to the Business, and
(c) any change in or addition to the locations where Borrower's Inventory
or records are kept.
8.1.7 Payment of Taxes. Borrower will, and will cause each
Subsidiary to, pay or cause to be paid, when and as due, all taxes,
assessments and charges or levies imposed upon it or on any of its
property or that it is required to withhold and pay over to the taxing
authority or that it must pay on its income, the failure of which to pay
would have a material adverse change on Borrower individually, or on
Borrower and the Subsidiaries on a consolidated basis, except where
contested in good faith by appropriate proceedings with adequate reserves
therefor in accordance with GAAP, having been set aside by Borrower or
such Subsidiary. However, Borrower will and will cause each Subsidiary to,
pay or cause to be paid all such taxes, assessments, charges or levies
immediately whenever foreclosure of any Lien that attaches on the
Collateral appears imminent.
8.1.8 Further Assurances. Borrower agrees to, and will cause each
Subsidiary to, execute such other and further documents, including,
without limitation, promissory notes, security agreements, financing
statements, continuation statements, certificates of title on Inventory,
and the like as may from time to time in the reasonable opinion of DFS be
necessary to perfect, confirm, establish, re-establish, continue, or
22
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
complete the security interests, collateral assignments and Liens in the
Collateral, and the purposes and intentions of this Agreement.
8.1.9 Maintenance of Status. Borrower will take all necessary
steps to (a) preserve its, and each Subsidiary's, existence as a
corporation, (b) preserve Borrower's and the Subsidiaries' franchises and
permits, and (c) comply with all present and future material agreements to
which Borrower, or any of the Subsidiaries, is subject, and (d) maintain,
and cause each Subsidiary to maintain, its qualification and good standing
in all states in which such qualification is necessary or in which the
failure to be so qualified might have a material adverse change on the
financial condition or properties of Borrower or the Business. Borrower
will not change the nature of the Business during the term of this
Agreement.
8.1.10 Financial Statements; Reporting Requirements; Certification
as to Events of Defaults. During the term of this Agreement, Borrower
will furnish to DFS:
(a) within 90 days after the end of each fiscal year, annual
financial statements for Borrower and its Subsidiaries as of the end of
such fiscal year, consisting of a consolidated balance sheet, consolidated
statement of operations, consolidated statements of cash flows and
consolidated statement of stockholder's equity, in comparative form,
together with a narrative description of the financial condition and
results of operations and the liquidity and capital resources of Borrower
and setting forth in comparative form the corresponding figures for the
corresponding period of the prior fiscal year and the corresponding
figures from the most recent financial projections of Borrower, discussing
the reasons for any significant variations. The statements and balance
sheet will be prepared in accordance with GAAP and audited by an
independent firm of certified public accountants selected by Borrower and
reasonably acceptable to DFS.
(b) within 45 days after the end of each fiscal quarter, financial
statements for Borrower and its Subsidiaries as of the end of such fiscal
quarter, consisting of a consolidated balance sheet and consolidated
statement of operations, in comparative form setting forth the
corresponding figures for the corresponding period of the same fiscal
quarter from the prior fiscal year. The statements and balance sheet will
be prepared in accordance with GAAP
(c) by the 45th day after the end of each fiscal quarter, a
certificate of the President, or Chief Financial Officer, in the form of
Exhibit 8.1.10(c) attached hereto, of Borrower stating that such Person
has reviewed the provisions of the Loan Documents and that a review of the
activities of Borrower during such quarter has been made by or under such
Person's supervision with a view to determining whether Borrower has
observed and performed all of Borrower's obligations under the Loan
Documents, and that, to the best of such Person's knowledge, information
and belief, Borrower has observed and performed each and every undertaking
contained in the Loan Documents and is not at the time in default in the
observance or performance of any of the terms and conditions thereof or,
if Borrower will be so in default, specifying all of such defaults and
events of which such Person may have knowledge;
(d) within 30 days after the end of each fiscal year, a detailed
budget, a detailed projected income statement with cash flow projections
and a detailed projected balance sheet for the following fiscal year;
(e) copies of any and all reports, filings and other documentation
delivered to the Securities and Exchange Commission by or on behalf of
Borrower promptly after the delivery thereof, if applicable; and
(f) any other statements, reports and other information as DFS may
reasonably request concerning the financial condition or operations of
Borrower and its properties.
8.1.11 Notice of Existence of Default. Borrower will, and will
cause its Subsidiaries to, promptly notify DFS of: (a) the existence of
any known condition or event, which constitutes a Default or an Unmatured
23
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
Default and (b) the actual or threatened termination, suspension, lapse or
relinquishment of any material license, authorization, permit or other
right granted Borrower or for Borrower's benefit and used in the Business,
or granted to any of its Subsidiaries or for any such Subsidiaries'
benefit, by any governmental agency material to the Business.
8.1.12 Compliance with Laws. Borrower will, and will cause its
Subsidiaries to, comply in all material respects with all applicable laws,
rules, regulations and orders.
8.1.13 Maintenance of Collateral. Borrower will maintain all
Collateral and every part thereof in good condition and repair. Borrower
will not permit the value of the Collateral to be materially impaired.
Borrower will defend the Collateral against all claims and legal
proceedings by persons other than DFS. Borrower will not transfer the
Collateral from the premises where now located (other than Inventory sold
in the ordinary course of business and other Collateral transferred in the
ordinary course of business), or permit the Collateral to become a fixture
or accession (unless so affixed on the Effective Date) to any goods which
are not items of Collateral, without the prior written approval of DFS.
Borrower will not knowingly permit the Collateral to be used in violation
of any applicable law, regulations, or any policy of insurance. As to
Collateral consisting of instruments and chattel paper, Borrower will
preserve rights in it against prior parties.
8.1.14 Collateral Records and Statements. Borrower will keep such
accurate and complete books and records pertaining to the Collateral in
such detail and form as DFS reasonably requires, including, but not
limited to: schedules of inventory; original orders; invoices; shipping
documents; billing settlements and receivables; sold receivables;
Inventory listing containing model, serial number (if available) and
location. Other reporting will be available upon request by DFS,
including, but not be limited to, listings of accounts payable in such
form as the DFS' reasonably requires. The statements will be in the form
and will contain the information as is prescribed by DFS.
8.1.15 Inspection of Collateral. DFS and any third party appraiser
selected by DFS may examine any or all of the Collateral at any time, and
from time to time during normal business hours. DFS and any third party
appraiser selected by DFS will have full access to, and the right to: (a)
review, inspect and make abstracts and copies from Borrower's books and
records pertaining to the Accounts and all other Collateral (whether or
not Borrower has borrowed against the Accounts or any such Collateral),
and (b) inspect and examine Inventory and Parts and check and test the
same as to quality, quantity, Value and condition, wherever located, at
any time during reasonable business hours, and from time to time. Borrower
will assist DFS and any third party appraiser selected by DFS in so doing.
8.1.16 Landlord's Agreements. Borrower will cooperate with DFS to
obtain, on the Effective Date, landlord waivers and agreements in a form
acceptable to DFS with respect to leased real property and with respect to
any future leases, prior to entering into them.
9. FINANCIAL COVENANTS.
9.1 Amounts.
9.1.1 Minimum Tangible Net Worth. Borrower covenants that it will
maintain as of the last day of each fiscal quarter ending on or after
March 31, 2000 a Tangible Net Worth plus Subordinated Debt of not less
than Twenty Million Dollars ($20,000,000); and
9.1.2 Minimum Current Ratio. Borrower covenants that it will
maintain as of the last day of each fiscal quarter ending on or after
March 31, 2000 a ratio of Current Tangible Assets to current liabilities
of not less than One and Two-tenths to One (1.2:1.0).
24
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
9.1.3 Maximum Debt to Tangible Net Worth. Borrower covenants that
it will maintain as of the last day of each fiscal quarter ending on or
after March 31, 2000 (a) a ratio of Debt minus Subordinated Debt to (b)
Tangible Net Worth plus Subordinated Debt of not more than Six to One
(6.0:1.0); and
9.2 Certain Definitions. As used in this Section 9 and elsewhere herein,
the following capitalized terms shall have the following meanings:
"Current Tangible Assets" means Borrower's current assets less, to
the extent otherwise included therein, all Intangibles.
"Intangibles" means and includes general intangibles (as that
term is defined in the Uniform Commercial Code); accounts
receivable and advances due from officers, directors, member,
owner, employees, stockholders and affiliates; leasehold
improvements net of depreciation; licenses; good will; prepaid
expenses; escrow deposits; covenants not to compete; the excess of
cost over book value of acquired assets; franchise fees;
organizational costs; finance reserves held for recourse
obligations; capitalized research and development costs; and such
other similar items as DFS may from time to time determine in DFS'
sole discretion.
"Subordinated Debt" means all of Borrower's Debt which is
subordinated to the payment of Borrower's liabilities to DFS by an
agreement in form and substance satisfactory to DFS.
"Tangible Net Worth" means the book value of Borrower's assets
less liabilities (including as liabilities all reserves for
contingencies and other potential liabilities), excluding from
such assets all Intangibles.
9.3 Covenant Compliance Certificate. The President or Chief Financial
Officer of Borrower will certify to DFS by the 45th day after the end of each
fiscal quarter, or more often if requested by DFS, that Borrower is in
compliance with the Financial Covenants as set forth in Exhibit 9.3 or other
form acceptable to DFS.
10. NEGATIVE COVENANTS
During the term of this Agreement and thereafter, for so long as any
Obligations are outstanding and unpaid, Borrower covenants that unless otherwise
consented to in writing by DFS, Borrower shall not perform or cause or permit to
be performed the following acts:
10.1 Change of Name, Etc. Borrower and the Subsidiaries will not change
their name, or begin to trade under any assumed names or trade names without
thirty (30) days prior written notice to DFS. Borrower will not, and will not
permit any Subsidiary to, change its manner of organization, enter into any
mergers, consolidations, reorganizations or recapitalizations without DFS' prior
written consent other than as contemplated herein.
10.2 Sale or Transfer of Assets. Except in the ordinary course of
business, or except as consented to in writing by DFS, Borrower and the
Subsidiaries will not sell, transfer, lease (including sale-leaseback) or
otherwise dispose of all or any substantial part of the Collateral. This
provision will not apply to any sale if the proceeds of such sale pay the
Obligations in full.
10.3 Change in Control. (a) Borrower shall not: (i) merge or consolidate
with or into any other Person, or (ii) unless the owners of Borrower continue to
hold 51% of the issued and outstanding capital stock of Borrower (including all
options and warrants therefor), permit any Person or group of Persons, to become
the record or beneficial owner, directly or indirectly, of securities
25
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
representing any of the voting power of Borrower's then outstanding securities
or any equity interest in Borrower, or otherwise having the power to vote, or
acquire the power to elect a majority of the Board of Directors of Borrower, or
(b) neither Xxxx Xxxxxx'x nor Xxxxxxx Xxxxxxx'x employment with Borrower shall
be voluntarily or involuntarily terminated, nor shall new management be
installed by Borrower without (i) sixty (60) days prior written notice to DFS,
and (ii) DFS' prior written consent.
10.4 Encumbrance of Assets. Borrower will not, and will not permit a
Subsidiary to, mortgage, pledge, grant or permit to exist a security interest in
or Lien upon any of the Collateral, now owned or hereafter acquired except for
the Permitted Liens.
10.5 False Certificates or Documents. Borrower has not and will not, and
will not permit any Subsidiary to, furnish DFS with any certificate or other
document that contains any untrue statement of material fact or that omits to
state a material fact necessary to make it not misleading in light of the
circumstances under which it was furnished.
10.6 Assignment. Borrower will not assign or attempt to assign the Loan
Documents or any of its interests under the Loan Documents, except in favor of
DFS.
10.7 Transactions with Affiliates. Borrower will not enter into any
contracts, leases, sales or other transactions with any Affiliate on terms less
favorable than could be obtained generally by Borrower from a non-Affiliate.
10.8 Loans by Borrower. Borrower will not, and will not permit any
Subsidiary to, make any loan to any Person, except for loans in anticipation of
reasonable and normally reimbursable business expenses, payroll and commission
advances and trade credit extended in the ordinary course of Business.
10.9 Fiscal Year; Accounting Methods. Borrower will not change its fiscal
year-end without sixty (60) days prior written notice to DFS. Borrower will not,
in any material way, deviate from GAAP or change its accounting policies or
methods, without the prior written consent of DFS.
10.10 Total Debt. Borrower shall not create, incur, assume, or suffer to
exist, or permit any Subsidiary to create, incur or suffer to exist, any Debt,
except:
(a) the Obligations;
(b) Subordinated Debt;
(c) Debt of any Subsidiary to Borrower;
(d) Accounts payable to trade creditors and current operating expenses
(other than for money borrowed) incurred in the ordinary course of
business which are aged not more than thirty (30) days past due, unless
actively contested in good faith and by appropriate and lawful proceedings
and for which adequate reserves have been established in accordance with
GAAP; and (e) Debt solely in connection with a Permitted Lien; and (f)
Debt which is not secured by any Lien.
10.11 Adverse Transactions. Borrower will not enter into any transaction,
or permit any Subsidiary to enter into any transaction, which materially and
adversely affects or may materially and adversely affect the Collateral or
Borrower's ability to repay the Obligations or permit or agree to any material
extension, compromise or settlement or make any change or modification of any
kind or nature with respect to any Account, including any of the terms relating
thereto, other than discounts and allowances in the ordinary course of business,
all of which shall be reflected in the Borrowing Base Certificate submitted to
DFS pursuant to Section 2.3 of this Agreement.
26
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
10.12 Guaranties. Borrower will not guarantee, assume, endorse or
otherwise, in any way, become directly or contingently liable with respect to
the Debt of any Person, except by endorsement of instruments or items of payment
for deposit or collection.
10.13 Xxxx-and-Hold Sales, Etc. Borrower will not include on any Borrowing
Base certificate any Accounts which arise from any sale to any customer on a
xxxx-and-hold, guaranteed sale, sale and return, sale on approval or consignment
basis, or any sale on a repurchase or return basis without DFS' prior written
consent.
10.14 Margin Securities. Borrower will not own, purchase or acquire, or
permit any Subsidiary to own, purchase or acquire, (or enter, or permit any
Subsidiary to enter, into any contract to purchase or acquire) any "margin
security" as defined by any regulation of the Federal Reserve Board as now in
effect or as the same may hereafter be in effect unless, prior to any such
purchase or acquisition or entering into any such contract, DFS shall have
received an opinion of counsel satisfactory to DFS to the effect that such
purchase or acquisition will not cause this Agreement to violate Regulations G
or U or any other regulation of the Federal Reserve Board then in effect.
11. DEFAULT/REMEDIES
11.1 Events of Default. Borrower will be in default under this Agreement
(each, a "Default") if:
11.1.1 Failure to Pay Principal or Interest. Borrower fails to pay
any portion of Borrower's debts to DFS when due and payable hereunder or
under any other agreement between DFS and Borrower.
11.1.2 Failure to Pay Other Amounts to DFS. Borrower fails to pay
any Obligations (other than principal or accrued interest) within 15 days
after the date when due.
11.1.3 Failure to Pay Certain Costs and Expenses. Borrower fails
to pay any costs or expenses of DFS, including without limitation, review
costs described in Section 2.5.6.2 hereof, appraisal costs described in
Section 2.5.6.3 hereof and other costs and expenses described in Section
2.5.6.4 hereof, within 15 days after the date when due.
11.1.4 Failure to Pay Amounts Owed to Other Persons. Borrower is
or becomes in default of any obligation in excess of $1,000,000 owed to
any third party, and such default continues unwaived beyond any applicable
grace or curing period.
11.1.5 Certain Representations and Warranties Without A Curing
Period. Any Representation and Warranty, statement, report or certificate
made or delivered by Borrower to DFS in Sections 6.1.3, 7.5, 7.7, 7.9,
7.17, 7.20 AND 7.23 is not true and correct when made.
11.1.6 Certain Representations and Warranties With A Curing
Period. Any Representation and Warranty, statement, report or certificate
made or delivered by Borrower to DFS (other than in Sections 6.1.3, 7.5,
7.7, 7.9, 7.17, 7.20 AND 7.23) is false in any material respect when made
and is not cured within 15 days of the date such Representation and
Warranty was made.
11.1.7 Certain Covenants With a Curing Period. Borrower fails to
comply with any Covenant (other than Covenants in Section 9) which is not
cured within 15 days of the initial occurrence of such failure.
11.1.8 Certain Covenants Without a Curing Period. Borrower fails
to comply with any Covenant in Section 9; provided, however, that if
Borrower breaches any such covenant, Borrower must (i) advise DFS of such
breach as of or prior to the last Business Day of the fiscal quarter
27
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
during which such breach occurs, and (ii) provide DFS within fifteen (15)
days after the end of such fiscal quarter financial projections which
indicate Borrower's compliance with all such covenants at the end of the
fiscal quarter immediately following the fiscal quarter in which the
breach occurred and the basis for such projections.
11.1.9 Default Under Other Agreements. A default or event of
default occurs under any agreement to which Borrower is a party (other
than the Loan Documents) involving Debt in excess of $1,000,000 which
default or event of default continues unwaived beyond any applicable
curing period and has or is reasonably likely to have a Material Adverse
Change or the Debt thereunder is accelerated.
11.1.10 Bankruptcy, Etc.
11.1.10.1 Voluntary Cases. The filing or commencement by
Borrower of a voluntary case or other proceeding seeking
liquidation, reorganization or other relief with respect to
Borrower or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment
of a trustee, receiver, liquidator, custodian or other similar
official of Borrower or any substantial part of its property, or
Borrower shall consent to any such relief or to the appointment of
or taking possession by any such official in an involuntary case
or other proceeding commenced against Borrower, or Borrower shall
make a general assignment for the benefit of creditors, or shall
fail generally to pay its debts as they become due, or shall take
any corporate action to authorize any of the foregoing.
11.1.10.2 Involuntary Cases. The filing or commencement
of an involuntary case or other proceeding against Borrower
seeking liquidation, reorganization or other relief with respect
to Borrower or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment
of a trustee, receiver, liquidator, custodian or similar other
official of Borrower or any substantial part of its property, and
such involuntary case or other proceeding remains undismissed and
unstayed for a period of thirty (30) days, or an order for relief
is entered against Borrower under the federal bankruptcy laws or
any state bankruptcy or insolvency laws now or hereafter in
effect.
11.1.11 Judgment, Attachments, Etc. A money judgment entered
against Borrower or an attachment or other levy is made against the assets
of Borrower with respect to a claim in excess of $1,000,000 becomes final
and non-appealable, or if timely appealed is not fully bonded and the
collection thereof is not stayed pending the appeal.
11.1.12 Suspension, Dissolution or Liquidation. Borrower ceases or
suspends business operations, ceases existence as a corporation, or
Borrower shall be enjoined, restrained or in any way prevented by court,
governmental or administrative order from conducting all or any material
part of its Business.
11.1.13 Loss of Franchise. Borrower loses any franchise,
permission, license or right to sell or deal in any Collateral
manufactured by OMC, Brunswick, and/or Genmar or any of their Subsidiaries
and does not replace the manufacturers with product lines a person with
knowledge of the marine industry would consider reasonable.
11.1.14 Liens Other Than Permitted Liens. Any of the Collateral
becomes subject to any Lien, claim, encumbrance or security interest
other than a Permitted Lien.
11.1.15 Loan Documents; Security Interest. Any Loan Document
ceases to be in full force and effect or any security interest or Lien in
favor of DFS is not, or ceases to be, valid, perfected and prior to all
other Liens (except Permitted Liens).
28
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
11.1.16 Loss of Collateral. Any Collateral is abandoned, lost,
stolen, damaged or destroyed, or any part of the Collateral shall be taken
through condemnation or the value thereof shall be impaired through
condemnation, and such loss of Collateral is not insured as required in
this Agreement or is reasonably likely to have a Material Adverse Change.
11.1.17 Loss of Guaranty. Any Guaranty ceases to be in full force
and effect or any action is taken to discontinue or assert the invalidity
or unenforceability of any Guaranty, any guarantor dies, ceases or
suspends business or ceases existence, any representation or warranty in
any guaranty is materially false and such representation or warranty is
not cured within 15 days of the date such representation or warranty was
made, or any guarantor fails to deliver financial statements to DFS as
required and such failure continues for 15 days.
11.1.18 Material Adverse Change. There occurs any action or event,
or any action or event fails to occur, which is or is reasonably likely
to become a Material Adverse Change.
11.2 Rights and Remedies. In the event of a Default:
11.2.1 Cessation of Advances; Acceleration; etc. DFS may at any
time at DFS' election, without notice or demand to Borrower, do any one or
more of the following: reduce the amount advanced against any eligible
Collateral; cease making further Loans and declare all or any of the
Obligations immediately due and payable, together with all costs and
expenses of DFS' collection activity, including, without limitation, all
reasonable attorneys' fees; exercise any or all rights under applicable
law (including, without limitation, the right to possess, transfer and
dispose of the Collateral); and/or cease extending any additional credit
to Borrower.
11.2.2 Collateral in Trust for DFS. Borrower will segregate and
keep the Collateral in trust for DFS, and in good order and repair, and
will not sell, rent, lease, consign, otherwise dispose of or use any
Collateral, nor further encumber any Collateral.
11.2.3 Delivery of Collateral to DFS. Upon DFS' written demand,
Borrower will immediately deliver the Collateral to DFS, in good order and
repair, at a place reasonably specified by DFS, together with all related
documents; or DFS may, in DFS' sole discretion and without notice or
demand to Borrower, take immediate possession of the Collateral together
with all related documents.
11.2.4 Default Interest. DFS may, without notice, apply the
Default Interest Rate.
11.2.5 Collection of Accounts; DFS Possession of Collateral by
DFS; etc. DFS may, without notice to Borrower and at any time or times
hereafter enforce payment and collect, by legal proceedings or otherwise,
Accounts in the name of Borrower or DFS; and take control of any cash or
non-cash items of payment or proceeds of Accounts and of any rejected,
returned, repossessed or stopped in transit goods relating to Accounts.
DFS may at its sole election and without demand enter, with or without
process of law, any premises where Collateral might be and, without charge
or liability to DFS therefor do one or more of the following: (i) take
possession of the Collateral and use or store it in said premises or
remove it to such other place or places as DFS may deem convenient; (ii)
take possession of all or part of such premises and the Collateral and
place a custodian in the exclusive control thereof until completion of
enforcement of DFS' security interest in the Collateral, until DFS'
removal of the Collateral or thirty (30) days, whichever occurs first and,
(iii) remain on such premises for up to thirty (30) days and use the same,
together with Borrower's materials, supplies, books and records, for the
purpose of liquidating or collecting such Collateral and conducting and
preparing for disposition of such Collateral.
29
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
11.2.6 Immediate Acceleration. Upon the occurrence of a Default
under Sections 11.1.1, 11.1.4, 11.1.10, or 11.1.12, all Obligations shall
automatically be accelerated and due and payable and the Default Interest
Rate shall automatically apply as of the date of the first occurrence of
such Default, without any prior notice, demand or action of any type on
the part of DFS.
All of DFS' rights and remedies are cumulative. DFS' failure to exercise
any of DFS' rights or remedies hereunder will not waive any of DFS' rights
or remedies as to any past, current or future Default.
12. SALE OF COLLATERAL
Borrower agrees that if DFS conducts a private sale of any Collateral by
requesting bids from 10 or more Borrowers or distributors in that type of
Collateral, any sale by DFS of such Collateral in bulk or in parcels within 120
days of: (a) DFS' taking possession and control of such Collateral; or (b) when
DFS is otherwise authorized to sell such Collateral; whichever occurs last, to
the bidder submitting the highest cash bid therefor, is a commercially
reasonable sale of such Collateral under the Uniform Commercial Code. Borrower
agrees that the purchase of any Collateral by a vendor, as provided in any
agreement between DFS and the vendor, if any, is a commercially reasonable
disposition and private sale of such Collateral under the Uniform Commercial
Code, and no request for bids shall be required. Borrower further agrees that 7
or more days prior written notice will be commercially reasonable notice of any
public or private sale (including any sale to a vendor). Borrower irrevocably
waives any requirement that DFS retain possession and not dispose of any
Collateral until after an arbitration hearing, arbitration award, confirmation,
trial or final judgment. If DFS disposes of any such Collateral other than as
herein contemplated, the commercial reasonableness of such disposition will be
determined in accordance with the laws of the state governing this Agreement.
13. INDEMNIFICATIONS
In addition to the payment of expenses and attorneys' fees, if applicable,
whether or not the transactions contemplated hereby shall be consummated,
Borrower agrees to indemnify, pay and hold DFS and the officers, directors,
employees, agents, and affiliates of DFS (collectively called the "Indemnitees")
harmless from and against, any and all other liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, claims, costs, expenses and
disbursements of any kind or nature whatsoever (including, without limitation,
the reasonable fees and disbursements of counsel for any of such Indemnitees in
connection with any investigative, administrative or judicial proceeding
commenced or threatened, whether or not any of such Indemnitees shall be
designated a party thereto), that may be imposed on, incurred by, or asserted
against the Indemnitees, in any manner relating to or arising out of the Loan
Documents, the statements contained in any commitment letters delivered by DFS,
DFS' agreement to make the Loans or any other payment hereunder, or the use or
intended use of the proceeds of any of the Loans hereunder (the "Indemnified
Liabilities"); provided, however, that Borrower shall have no obligation to an
Indemnitee hereunder with respect to Indemnified Liabilities arising from the
gross negligence or willful misconduct of an Indemnitee. To the extent that the
undertaking to indemnify, pay and hold harmless set forth in the preceding
sentence may be unenforceable because it is violative of any law or public
policy, Borrower shall contribute the maximum portion that it is permitted to
pay and satisfy under applicable law, to the payment and satisfaction of all
Indemnified Liabilities incurred by the Indemnitees or any of them. The
provisions of the undertakings and indemnification set out in this Section 14
shall survive satisfaction and payment of the Obligations and termination of
this Agreement.
14. OTHER TERMS
14.1 Amendment, Changes and Modification. The Loan Documents may be
amended, changed or modified only as may be agreed upon in writing by Borrower
and DFS from time to time.
30
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
14.2 Binding Effect. The Loan Documents will be binding upon the parties,
their successors and assigns, provided, however, that Borrower shall not assign
or attempt to assign this Agreement, any other Loan Document or any of its
interests under the Loan Documents, without the prior written consent of DFS.
14.3 Broker Fee. Neither party is obligated to pay any premium or other
charge, brokerage fee or commission in connection with the agreements set forth
herein. Each party will indemnify the other and hold it harmless from any such
claim arising out of such party's acts or those of its representatives.
14.4 Entire Agreement. The Loan Documents embody the entire agreement of
the parties relating to the Credit Facility. There are no promises, terms,
conditions, obligations or warranties other than those contained in the Loan
Documents. The Loan Documents supersede all prior communications,
representations or agreements, verbal or written, between the parties relating
to the Credit Facility.
14.5 Headings. The headings to the sections of this Agreement are included
only for the convenience of the parties and will not have the effect of
defining, diminishing or enlarging the rights of the parties or affecting the
construction or interpretation of any portion of this Agreement.
14.6 Incorporation by Reference. All other Loan Documents are incorporated
herein by this reference and are made a part of this Agreement as if fully set
forth herein. This Agreement, prior to such incorporation, controls in the event
of any conflict with the terms of any other Loan Documents.
14.7 Interpretation. For the purpose of construing this Agreement, unless
the context otherwise requires, words in the singular will be deemed to include
words in the plural, and vice versa.
14.8 Notices. Any notice under the Loan Documents, will be in writing. Any
notice to be given or document to be delivered under the Loan Documents will be
deemed to have been duly given upon delivery, if delivered in person or by any
expedited delivery service which provides proof of delivery, upon tested telex
or facsimile transmission, or on the fifth Business Day after mailing, if mailed
by certified mail, return receipt requested, postage prepaid mail, addressed to
DFS or Borrower at the appropriate addresses. DFS will use reasonable efforts to
deliver any notice DFS is required to give to Borrower; provided, however, that
failure by DFS to actually give any such notice will not be deemed to be a
waiver of any rights or remedies of DFS and will not give rise to any claims,
defenses or damages by Borrower. The addresses for notices are those set forth
below or such other addresses as may be hereafter specified by written notice by
the parties:
to DFS: Deutsche Financial Services Corporation
0000 Xxxxxxxxx Xxxxx, Xxxxx 000,
Xxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxx
Facsimile No.: (000) 000-0000
with a copy to: Deutsche Financial Services Corporation
000 Xxxxxxxxx Xxxxxx Xxxxx
Xx. Xxxxx, XX 00000-0000
Attention: General Counsel
Facsimile No.:(000) 000-0000
to Borrower: Xxxxxx Boats & Motors, Inc.
0000 Xxxxx xx xxx Xxxx, Xxxxx 000
Xxxxxx, XX 00000
Attention: President
Facsimile No.: (000) 000-0000
31
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
14.9 No Third Party Beneficiary Rights and Reliance. No Person not a party
to this Agreement will have any benefit under this Agreement nor have
third-party beneficiary rights as a result of any of the Loan Documents, nor
will any party be entitled to rely on any actions or inactions of DFS or its
agents, all of which are done for the sole benefit and protection of DFS.
14.10 Protection or Preservation of Collateral. DFS will not have any
contractual duty to protect, insure, collect or realize upon the Collateral or
preserve rights in it against prior parties. DFS will not be responsible or
liable for any shortage, discrepancy, damage, loss or destruction of any part of
the Collateral regardless of the cause.
14.11 Relationship of the Parties. Neither DFS on the one hand nor
Borrower on the other hand will be deemed a partner, joint venturer or related
entity of the other by reason of the Loan Documents.
14.12 Reversal of Payments. To the extent that Borrower makes a payment or
payments to DFS, which payment or payments or proceeds or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law, or equitable cause, then to
the extent of such payment or proceeds received, the Credit Facility will be
revived and continue in full force and effect, as if such payment or proceeds
had not been received by DFS.
14.13 Severability. If any provision of this Agreement (either generally,
or as to a specific application to a set of facts) will be held to be invalid,
illegal or unenforceable, such invalidity, illegality or unenforceability will
not affect any other provision of this Agreement (either in its entirety, or as
to or the application of such provision to any other set of facts), but this
Agreement will be construed as if such invalid, illegal or unenforceable
provision never had been included in this Agreement.
14.14 Maximum Interest. Borrower acknowledges that DFS intends to strictly
conform to the applicable usury laws governing this Agreement. Regardless of any
provision contained herein or in any other document executed or delivered in
connection herewith or therewith, DFS shall never be deemed to have contracted
for, charged or be entitled to receive, collect or apply as interest on this
Agreement (whether termed interest herein or deemed to be interest by judicial
determination or operation of law), any amount in excess of the maximum amount
allowed by applicable law, and, if DFS ever receives, collects or applies as
interest any such excess, such amount which would be excessive interest will be
applied first to the reduction of the unpaid principal balances of advances
under this Agreement, and, second, any remaining excess will be paid to
Borrower. In determining whether or not the interest paid or payable under any
specific contingency exceeds the highest lawful rate, Borrower and DFS shall, to
the maximum extent permitted under applicable law: (a) characterize any
non-principal payment (other than payments which are expressly designated as
interest payments hereunder) as an expense or fee rather than as interest; (b)
exclude voluntary pre-payments and the effect thereof; and (c) spread the total
amount of interest throughout the entire term of this Agreement so that the
interest rate is uniform throughout such term.
14.15 Waivers by DFS. DFS may at any time or from time to time waive all
or any rights under any of the Loan Documents, but any waiver or indulgence at
any time or from time to time will not constitute, unless specifically so
expressed by DFS in writing, a future waiver by DFS of performance by Borrower.
14.16 Survival. The grant of security interest herein to secure all
Obligations, and all provisions relating to the Collateral will survive
termination of this Agreement and will remain in full force and effect until all
Obligations have been paid in full and this Agreement has been terminated. The
Agreement to arbitrate all Disputes will survive termination of this Agreement.
32
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
14.17 Participations; Assignments. DFS may, at any time and from time to
time, grant participations to lender(s) acceptable to Borrower in its interest
in this Agreement or any Loan Document, or of any portion thereof, or assign its
interest in this Agreement or any Loan Document, or any portion thereof, without
the consent of Borrower, but DFS will provide Borrower notice as soon as
practical after sale to an unaffiliated third party. DFS shall not be required
to provide notice to Borrower of any sale or assignment to (a) a parent company
or subsidiary of DFS or (b) any entity majority owned by DFS so long as DFS
continues to service the Loans under this Agreement.
14.18 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument, and either of the parties hereto may execute this Agreement by
signing any such counterpart.
14.19 Information. DFS may provide to any third party any credit,
financial or other information on Borrower that DFS may from time to time
possess.
14.20 Release. Borrower releases DFS from all claims and causes of action
which Borrower may now or hereafter have for any loss or damage to it claimed to
be caused by or arising from: (a) any failure of DFS to protect, enforce or
collect, in whole or in part, any Account; (b) DFS' notification to any Account
Debtors thereon of DFS' security interest in any of the Accounts; (c) DFS'
directing any Account Debtor to pay any sum owing to Borrower directly to DFS;
and (d) any other act or omission to act on the part of DFS, its officers,
agents or employees, except for willful misconduct or gross negligence. DFS will
have no obligation to preserve rights to Accounts against prior parties.
14.21 Miscellaneous. Time is of the essence regarding Borrower's
performance of its obligations to DFS notwithstanding any course of dealing or
custom on DFS' part to grant extensions of time. Borrower's liability under this
Agreement is direct and unconditional and will not be affected by the release or
nonperfection of any security interest granted hereunder. DFS will have the
right to refrain from or postpone enforcement of this Agreement or any other
Loan Documents without prejudice and the failure to strictly enforce the Loan
Documents will not be construed as having created a course of dealing between
DFS and Borrower contrary to the specific terms of the Loan Documents or as
having modified, released or waived the same. The express terms of this
Agreement and the other Loan Documents will not be modified by any course of
dealing, usage of trade, or custom of trade which may deviate from the terms
hereof. If Borrower fails to pay any taxes, fees or other obligations which may
impair DFS' interest in the Collateral, or fails to keep the Collateral insured,
DFS may, but shall not be required to, pay such taxes, fees or obligations and
pay the cost to insure the Collateral, and the amounts paid will be: (a) an
additional debt owed by Borrower to DFS, which shall be subject to finance
charges as provided herein; and (b) due and payable immediately in full.
Borrower agrees to pay all of DFS' reasonable attorneys' fees and expenses
incurred by DFS in enforcing DFS' rights hereunder.
14.22 Waivers by Borrower. Borrower irrevocably waives notice of: DFS'
acceptance of this Agreement, presentment, demand, protest, nonpayment,
nonperformance, and dishonor. Borrower and DFS irrevocably waive all rights to
claim any punitive and/or exemplary damages. Borrower waives all rights of
offset and counter claims Borrower may have against DFS. Borrower waives all
notices of default and non-payment at maturity of any or all of the Accounts.
14.23 NO ORAL AGREEMENTS. ORAL AGREEMENTS OR COMMITMENTS TO LEND MONEY,
EXTEND CREDIT OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT INCLUDING
PROMISES TO EXTEND OR RENEW SUCH DEBT ARE NOT ENFORCEABLE. TO PROTECT YOU,
(BORROWER(S)) AND US (CREDITOR) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY
AGREEMENTS WE REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING, WHICH
33
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
IS THE COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US, EXCEPT AS
WE MAY LATER AGREE IN WRITING TO MODIFY IT. THERE ARE NO UNWRITTEN AGREEMENTS
BETWEEN THE PARTIES.
14.24 Use of Counsel and Receipt of Agreement. Borrower acknowledges that
it has received a true and complete copy of this Agreement. Borrower
acknowledges that it has (a) had representation of counsel during negotiation of
this Agreement, and (b) read and understood this Agreement.
14.25 Facsimiles, Etc. Notwithstanding anything herein to the contrary:
(a) DFS may rely on any facsimile copy, electronic data transmission or
electronic data storage of any statement, statement of transaction, financial
statements or other reports, and (b) such facsimile copy, electronic data
transmission or electronic data storage will be deemed an original, and the best
evidence thereof for all purposes, including, without limitation, under this
Agreement or any other Loan Documents, and for all evidentiary purposes before
any arbitrator, court or other adjudicatory authority.
14.26 Power of Attorney. Borrower irrevocably appoints DFS (and any Person
designated by it) as Borrower's true and lawful Attorney with full power to at
any time, in the discretion of DFS (whether or not a Default has occurred) to:
(a) endorse the name of Borrower upon any of the items of payment of proceeds of
the Collateral and deposit the same in the account of DFS for application to the
Obligations; and (b) sign the name of Borrower to verify the accuracy of the
Accounts; and (only after a Default has occurred) to: (c) sign the name of
Borrower on any document or instrument that DFS shall deem necessary or
appropriate to perfect and maintain perfected the security interests in the
Collateral under this Agreement and other Loan Documents; (d) initiate and
settle any insurance claim and endorse Borrower's name on any check, instrument
or other item of payment; (e) endorse the name of Borrower upon financing
statements, instruments, Certificates of Title and Statements of Origin
pertaining to the Collateral; (f) supply omitted information and correct errors
in any documents between DFS and Borrower; and (g) do anything to preserve and
protect the Collateral and DFS' rights and interest therein; (h) demand payment,
enforce payment and otherwise exercise all of Borrower's rights, and remedies
with respect to the collection of any Accounts; (i) settle, adjust, compromise,
extend or renew any Accounts; (j) settle, adjust or compromise any legal
proceedings brought to collect any Accounts; (k) sell or assign any Accounts
upon such terms, for such amounts and at such time or times as DFS may deem
advisable; (l) discharge and release any Accounts; (m) prepare, file and sign
Borrower's name on any Proof of Claim in Bankruptcy or similar document against
any Account Debtor; (n) endorse the name of Borrower upon any chattel paper,
document, instrument, invoice, freight xxxx, xxxx of lading or similar document
or agreement relating to any Account or goods pertaining thereto; and (o) take
control in any manner of any item of payments or proceeds and for such purpose
to notify the Postal Authorities to change the address for delivery of mail
addressed to Borrower to such address as DFS may designate. This power of
attorney is for value and coupled with an interest and is irrevocable so long as
any Obligations remain outstanding and by DFS exercising such right, DFS shall
not waive any right against Borrower until the Obligations are paid in full.
15. BINDING ARBITRATION
15.1 Arbitrable Claims. Except as otherwise specified below, all actions,
disputes, claims and controversies under common law, statutory law or in equity
of any type or nature whatsoever (including, without limitation, all torts,
whether regarding negligence, breach of fiduciary duty, restraint of trade,
fraud, conversion, duress, interference, wrongful replevin, wrongful
sequestration, fraud in the inducement, usury or any other tort, all contract
actions, whether regarding express or implied terms, such as implied covenants
of good faith, fair dealing, and the commercial reasonableness of any Collateral
disposition, or any other contract claim, all claims of deceptive trade
practices or lender liability, and all claims questioning the reasonableness or
lawfulness of any act), whether arising before or after the date of this
Agreement, and whether directly or indirectly relating to: (a) this Agreement
and/or any amendments and addenda hereto, or the breach, invalidity or
termination hereof; (b) any previous or subsequent agreement between DFS and
Borrower; (c) any act committed by DFS or by any parent company, subsidiary or
affiliated company of DFS (the "DFS Companies"), or by any employee, agent,
34
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
officer or director of a DFS Company whether or not arising within the scope and
course of employment or other contractual representation of the DFS Companies
provided that such act arises under a relationship, transaction or dealing
between DFS and Borrower; and/or (d) any other relationship, transaction or
dealing between DFS and Borrower (collectively the "Disputes"), will be subject
to and resolved by binding arbitration.
15.2 Administrative Body. All arbitration hereunder will be conducted by
the American Arbitration Association ("AAA"). If the AAA is dissolved, disbanded
or becomes subject to any state or federal bankruptcy or insolvency proceeding,
the parties will remain subject to binding arbitration which will be conducted
by a mutually agreeable arbitral forum. The parties agree that all arbitrator(s)
selected will be attorneys with at least five (5) years secured transactions
experience. The arbitrator(s) will decide if any inconsistency exists between
the rules of any applicable arbitral forum and the arbitration provisions
contained herein. If such inconsistency exists, the arbitration provisions
contained herein will control and supersede such rules. The site of all
arbitration proceedings will be in St. Louis County, Missouri.
15.3 Discovery. Discovery permitted in any arbitration proceeding
commenced hereunder is limited as follows. No later than thirty (30) days after
the filing of a claim for arbitration, the parties will exchange detailed
statements setting forth the facts supporting the claim(s) and all defenses to
be raised during the arbitration, and a list of all exhibits and witnesses. No
later than twenty-one (21) days prior to the arbitration hearing, the parties
will exchange a final list of all exhibits and all witnesses, including any
designation of any expert witness(es) together with a summary of their
testimony; a copy of all documents and a detailed description of any property to
be introduced at the hearing. Under no circumstances will the use of
interrogatories, requests for admission, requests for the production of
documents or the taking of depositions be permitted. However, in the event of
the designation of any expert witness(es), the following will occur: (a) all
information and documents relied upon by the expert witness(es) will be
delivered to the opposing party, (b) the opposing party will be permitted to
depose the expert witness(es), (c) the opposing party will be permitted to
designate rebuttal expert witness(es), and (d) the arbitration hearing will be
continued to the earliest possible date that enables the foregoing limited
discovery to be accomplished.
15.4 Exemplary or Punitive Damages. The Arbitrator(s) will not have the
authority to award exemplary or punitive damages and each party hereby
irrevocably waives any right to claim any exemplary or punitive damages.
15.5 Confidentiality of Awards. All arbitration proceedings, including
testimony or evidence at hearings, will be kept confidential, although any award
or order rendered by the arbitrator(s) pursuant to the terms of this Agreement
may be entered as a judgment or order in any state or federal court and may be
confirmed within the federal judicial district which includes the residence of
the party against whom such award or order was entered. This Agreement concerns
transactions involving commerce among the several states. The Federal
Arbitration Act, Title 9 U.S.C. Sections 1 et seq., as amended ("FAA") will
govern all arbitration(s) and confirmation proceedings hereunder.
15.6 Prejudgment and Provisional Remedies. Nothing herein will be
construed to prevent DFS' or Borrower's use of bankruptcy, receivership,
injunction, repossession, replevin, claim and delivery, sequestration, seizure,
attachment, foreclosure, dation and/or any other prejudgment or provisional
action or remedy relating to any Collateral for any current or future debt owed
by either party to the other. Any such action or remedy will not waive DFS' or
Borrower's right to compel arbitration of any Dispute.
15.7 Attorneys' Fees. If either Borrower or DFS brings any other action
for judicial relief with respect to any Dispute (other than those set forth in
Section 15.6) the party bringing such action will be liable for and immediately
pay all of the other party's costs and expenses (including attorneys' fees)
incurred to stay or dismiss such action and remove or refer such Dispute to
arbitration. If either Borrower or DFS brings or appeals an action to vacate or
modify an arbitration award and such party does not prevail, such party will pay
35
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
all costs and expenses, including attorneys' fees, incurred by the other party
in defending such action. Except as set forth above, each party will bear their
own costs and expenses (including attorneys' fees).
15.8 Limitations. Any arbitration proceeding must be instituted: (a) with
respect to any Dispute for the collection of any debt owed by either party to
the other, within two (2) years after the date the last payment was received by
the instituting party; and (b) with respect to any other Dispute, within two (2)
years after the date the incident giving rise thereto occurred, whether or not
any damage was sustained or capable of ascertainment or either party knew of
such incident. Failure to institute an arbitration proceeding within such period
will constitute an absolute bar and waiver to the institution of any proceeding,
whether arbitration or a court proceeding, with respect to such Dispute.
15.9 Survival After Termination. The agreement to arbitrate will survive
the termination of this Agreement.
16. INVALIDITY/UNENFORCEABILITY OF BINDING ARBITRATION. IF THIS AGREEMENT IS
FOUND TO BE NOT SUBJECT TO ARBITRATION, ANY LEGAL PROCEEDING WITH RESPECT TO ANY
DISPUTE WILL BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE WITHOUT A
JURY. BORROWER AND DFS WAIVE ANY RIGHT TO A JURY TRIAL IN ANY SUCH PROCEEDING.
17. GOVERNING LAW. Borrower acknowledges and agrees that this and all other
agreements between Borrower and DFS have been substantially negotiated,
accepted, and will be substantially performed, in the state of Michigan.
Accordingly, Borrower agrees that all Disputes will be governed by, and
construed in accordance with, the laws of such state, except to the extent
inconsistent with the provisions of the FAA which shall control and govern all
arbitration proceedings hereunder.
IN WITNESS WHEREOF, the parties have, by their duly authorized officers,
executed this Agreement as of the Effective Date.
THIS AGREEMENT CONTAINS BINDING ARBITRATION, JURY WAIVER AND PUNITIVE DAMAGES
WAIVER PROVISIONS
ATTEST: XXXXXX BOATS & MOTORS, INC.
a Texas corporation
By:
------------------------------------ ------------------------------------
Assistant Secretary Print Name: Xxxxxxx X. Xxxxxxx
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
ATTEST: TBC Arkansas, Inc.
An Arkansas corporation
By:
------------------------------------ ------------------------------------
Assistant Secretary Print Name: Xxxxxxx X. Xxxxxxx
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
36
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
ATTEST: Xxxxxx Boating Center Arlington, Inc.
a Texas corporation
By:
------------------------------------ ------------------------------------
Assistant Secretary Print Name: Xxxxxxx X. Xxxxxxx
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
ATTEST: Xxxxxx Boating Center Beaumont, Inc.
a Texas corporation
By:
------------------------------------ ------------------------------------
Assistant Secretary Print Name: Xxxxxxx X. Xxxxxxx
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
ATTEST: Xxxxxx Boating Center Oklahoma, Inc.
A Texas corporation
By:
------------------------------------ ------------------------------------
Assistant Secretary Print Name: Xxxxxxx X. Xxxxxxx
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
ATTEST: Xxxxxx Boating Center Tennessee, Inc.
a Texas corporation
By:
------------------------------------ ------------------------------------
Assistant Secretary Print Name: Xxxxxxx X. Xxxxxxx
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
ATTEST: Xxxxxx Xxxxxxx Marine, Inc.
a Texas corporation
By:
------------------------------------ -----------------------------------
Assistant Secretary Print Name: Xxxxxxx X. Xxxxxxx
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
ATTEST: Falcon Marine, Inc.
a Texas corporation
By:
------------------------------------ -----------------------------------
Assistant Secretary Print Name: Xxxxxxx X. Xxxxxxx
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
37
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
ATTEST: Falcon Marine Abilene, Inc.
a Texas corporation
By:
------------------------------------ -----------------------------------
Assistant Secretary Print Name: Xxxxxxx X. Xxxxxxx
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
ATTEST: Xxxxxx Boating Center of Alabama, Inc.
a Texas corporation
By:
------------------------------------ ------------------------------------
Assistant Secretary Print Name: Xxxxxxx X. Xxxxxxx
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
ATTEST: Xxxxxx Boating Center Louisiana, Inc.
a Louisiana corporation
By:
------------------------------------ ------------------------------------
Assistant Secretary Print Name:
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
ATTEST: Xxxxxx Boats & Motors Baton Rouge, Inc.
a Louisiana corporation
By:
------------------------------------ ------------------------------------
Assistant Secretary Print Name: Xxxxxxx X. Xxxxxxx
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
ATTEST: Xxxxxx Boating Center Mississippi, Inc.
a Texas corporation
By:
------------------------------------ ------------------------------------
Assistant Secretary Print Name:
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
ATTEST: Xxxxxx Boating Center Little Rock, Inc.
An Arkansas corporation
By:
------------------------------------ ------------------------------------
Assistant Secretary Print Name:
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
38
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
ATTEST: Red River Marine Arkansas, Inc.
An Arkansas corporation
By:
------------------------------------ ------------------------------------
Assistant Secretary Print Name:
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
ATTEST: Shelby Marine Center, Inc.
a Tennessee corporation
By:
------------------------------------ ------------------------------------
Assistant Secretary Print Name:
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
ATTEST: Shelby Marine Pickwick, LLC
a Tennessee limited liability company
By: Xxxxxx Boating Center Tennessee, Inc.
------------------------------------
By:
Assistant Secretary Print Name:
Print Name: Xxxxx Xxxxxxxx Title: CFO, Secretary & Treasurer
DEUTSCHE FINANCIAL SERVICES CORPORATION
By:
Print Name:
Title:
Accepted at Troy, Michigan
39
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
INDEX OF EXHIBITS
EXHIBIT 2.3 Borrowing Base Certificate
EXHIBIT 6.1.10 President's Certificate
EXHIBIT 6.1.11 Secretary's Certificate of Resolution and Incumbency
EXHIBIT 7.3 Litigation
EXHIBIT 7.5 Liens
EXHIBIT 7.7 Subsidiaries
EXHIBIT 7.9 PRINCIPAL PLACE OF BUSINESS
EXHIBIT 7.11 FEDERAL IDENTIFICATION NUMBER
EXHIBIT 7.17 Collateral Locations
EXHIBIT 7.18 Real Property Owned or Leased
EXHIBIT 8.1.10(c) LOAN AND SECURITY
AGREEMENT CERTIFICATIONS
EXHIBIT 9.3 COVENANT COMPLIANCE CERTIFICATE
40
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 2.3
BORROWING BASE CERTIFICATE
Xxxxxx Boats & Motors, Inc.
Deutsche Financial Services
Borrowing Base Certificate
On Revolving Line of Credit for all Stores outside of Florida and Georgia
At ________________________
(1.)
(1.1) Eligible new inventory aged less than 540 days from date of invoice: $
x (times) advance rate of 100% __________
= (equals) amount eligible to borrow: $
(1.2) Eligible new inventory aged more than 540 days but not more than 720 days
from date of invoice: $
x (times) advance rate of 90% __________
= (equals) amount eligible to borrow: $
(2.)
(2.1) The lesser of $5MM of eligible used inventory held for not more than 365 days: $
x (times) advance rate of 70% __________
= (equals) amount eligible to borrow: $
(3.)
The lesser of $3MM or 50% of the cost of eligible parts inventory:
Total eligible parts inventory: $
x (times) advance rate of 50% __________
= (equals) amount eligible to borrow: $
(4.)
The lesser of $8MM or 80% of the net book value of eligible accounts (Contracts
in Transit):
Total eligible Contracts in Transit: $
x (times) advance rate of 80% __________
= (equals) amount eligible to borrow: $
Equals Total Proposed Borrowing Base Certificate $___________
(Not to exceed $36MM)
Borrower: Xxxxxx Boats & Motors, Inc. and subsidiaries
--------------------------------------------
By:
--------------------------------------------
Xxxxxx:
--------------------------------------------
41
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Xxxxxx Boats & Motors,
Inc., a Texas corporation, ("Borrower"), hereby certify to Deutsche Financial
Services Corporation ("DFS"), in connection with the Loan and Security Agreement
dated as of January 31, 2000 between Xxxxxx Boats and Motors, Inc. and its
Subsidiaries set forth therein (individually, collectively, jointly and
severally "Borrower") and DFS (the "Agreement"; terms defined in the Agreement
are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the date hereof as though made on and
as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
XXXXXX BOATS & MOTORS, INC.
By:____________________________
Title: Vice President & CFO
---------------------
42
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of TBC Arkansas, Inc., an
Arkansas corporation, ("Borrower"), hereby certify to Deutsche Financial
Services Corporation ("DFS"), in connection with the Loan and Security Agreement
dated as of January 31, 2000 between Xxxxxx Boats and Motors, Inc. and its
Subsidiaries set forth therein (individually, collectively, jointly and
severally "Borrower") and DFS (the "Agreement"; terms defined in the Agreement
are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the date hereof as though made on and
as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
TBC Arkansas, Inc.
By:_________________________________
Title: President
43
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Xxxxxx Boating Center
Arlington, Inc., a Texas corporation, ("Borrower"), hereby certify to Deutsche
Financial Services Corporation ("DFS"), in connection with the Loan and Security
Agreement dated as of January 31, 2000 between Xxxxxx Boats and Motors, Inc. and
its Subsidiaries set forth therein (individually, collectively, jointly and
severally "Borrower") and DFS (the "Agreement"; terms defined in the Agreement
are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the date hereof as though made on and
as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Xxxxxx Boating Center Arlington, Inc.
By:_________________________________
Title: President
44
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO Xxxxxx Boating Center
Beaumont, Inc., a Texas corporation, ("Borrower"), hereby certify to Deutsche
Financial Services Corporation ("DFS"), in connection with the Loan and Security
Agreement dated as of January 31, 2000 between Xxxxxx Boats and Motors, Inc. and
its Subsidiaries set forth therein (individually, collectively, jointly and
severally "Borrower") and DFS (the "Agreement"; terms defined in the Agreement
are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the date hereof as though made on and
as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Xxxxxx Boating Center Beaumont, Inc.
By:_________________________________
Title: President
45
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Xxxxxx Boating Center
Oklahoma, Inc., a Texas corporation, ("Borrower"), hereby certify to Deutsche
Financial Services Corporation ("DFS"), in connection with the Loan and Security
Agreement dated as of January 31, 2000 between Xxxxxx Boats and Motors, Inc. and
its Subsidiaries set forth therein (individually, collectively, jointly and
severally "Borrower") and DFS (the "Agreement"; terms defined in the Agreement
are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the date hereof as though made on and
as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Xxxxxx Boating Center Oklahoma, Inc.
By:_________________________________
Title: President
46
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Xxxxxx Boating Center
Tennessee, Inc., a Texas corporation, ("Borrower"), hereby certify to Deutsche
Financial Services Corporation ("DFS"), in connection with the Loan and Security
Agreement dated as of January 31, 2000 between Xxxxxx Boats and Motors, Inc. and
its Subsidiaries set forth therein (individually, collectively, jointly and
severally "Borrower") and DFS (the "Agreement"; terms defined in the Agreement
are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the date hereof as though made on and
as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Xxxxxx Boating Center Tennessee, Inc.
By:_________________________________
Title: President
47
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Xxxxxx Xxxxxxx Marine,
Inc., a Texas corporation, ("Borrower"), hereby certify to Deutsche Financial
Services Corporation ("DFS"), in connection with the Loan and Security Agreement
dated as of January 31, 2000 between Xxxxxx Boats and Motors, Inc. and its
Subsidiaries set forth therein (individually, collectively, jointly and
severally "Borrower") and DFS (the "Agreement"; terms defined in the Agreement
are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the date hereof as though made on and
as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Xxxxxx Xxxxxxx Marine, Inc.
By:_________________________________
Title: President
48
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Falcon Marine, Inc., a
Texas corporation, ("Borrower"), hereby certify to Deutsche Financial Services
Corporation ("DFS"), in connection with the Loan and Security Agreement dated as
of January 31, 2000 between Xxxxxx Boats and Motors, Inc. and its Subsidiaries
set forth therein (individually, collectively, jointly and severally "Borrower")
and DFS (the "Agreement"; terms defined in the Agreement are used herein as so
defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the date hereof as though made on and
as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Falcon Marine, Inc.
By:_________________________________
Title: President
49
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Falcon Marine Abilene,
Inc., a Texas corporation, ("Borrower"), hereby certify to Deutsche Financial
Services Corporation ("DFS"), in connection with the Loan and Security Agreement
dated as of January 31, 2000 between Xxxxxx Boats and Motors, Inc. and its
Subsidiaries set forth therein (individually, collectively, jointly and
severally "Borrower") and DFS (the "Agreement"; terms defined in the Agreement
are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the
date hereof as though made on and as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Falcon Marine Abilene, Inc.
By:_________________________________
Title: President
50
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Xxxxxx Boating Center
Alabama, Inc., a Texas corporation, ("Borrower"), hereby certify to Deutsche
Financial Services Corporation ("DFS"), in connection with the Loan and Security
Agreement dated as of January 31, 2000 between Xxxxxx Boats and Motors, Inc. and
its Subsidiaries set forth therein (individually, collectively, jointly and
severally "Borrower") and DFS (the "Agreement"; terms defined in the Agreement
are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the date hereof as though made on and
as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Xxxxxx Boating Center Alabama, Inc.
By:_________________________________
Title: President
51
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Xxxxxx Boating Center
Louisiana, Inc., a Louisiana corporation, ("Borrower"), hereby certify to
Deutsche Financial Services Corporation ("DFS"), in connection with the Loan and
Security Agreement dated as of January 31, 2000 between Xxxxxx Boats and Motors,
Inc. and its Subsidiaries set forth therein (individually, collectively, jointly
and severally "Borrower") and DFS (the "Agreement"; terms defined in the
Agreement are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the
date hereof as though made on and as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Xxxxxx Boating Center Louisiana, Inc.
By:_________________________________
Title: President
52
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Xxxxxx Boats & Motors
Baton Rouge, Inc., a Louisiana corporation, ("Borrower"), hereby certify to
Deutsche Financial Services Corporation ("DFS"), in connection with the Loan and
Security Agreement dated as of January 31, 2000 between Xxxxxx Boats and Motors,
Inc. and its Subsidiaries set forth therein (individually, collectively, jointly
and severally "Borrower") and DFS (the "Agreement"; terms defined in the
Agreement are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the date hereof as though made on and
as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Xxxxxx Boats & Motors Baton Rouge, Inc.
By:_________________________________
Title: President
53
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Xxxxxx Boating Center
Mississippi, Inc., a Texas corporation, ("Borrower"), hereby certify to Deutsche
Financial Services Corporation ("DFS"), in connection with the Loan and Security
Agreement dated as of January 31, 2000 between Xxxxxx Boats and Motors, Inc. and
its Subsidiaries set forth therein (individually, collectively, jointly and
severally "Borrower") and DFS (the "Agreement"; terms defined in the Agreement
are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the date hereof as though made on and
as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on
the date hereof, which constitutes a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Xxxxxx Boating Center Mississippi, Inc.
By:_________________________________
Title: President
54
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Xxxxxx Boating Center
Little Rock, Inc., an Arkansas corporation, ("Borrower"), hereby certify to
Deutsche Financial Services Corporation ("DFS"), in connection with the Loan and
Security Agreement dated as of January 31, 2000 between Xxxxxx Boats and Motors,
Inc. and its Subsidiaries set forth therein (individually, collectively, jointly
and severally "Borrower") and DFS (the "Agreement"; terms defined in the
Agreement are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7
of the Agreement are correct on and as of the date hereof as though made on and
as of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the
date hereof, Borrower will be in full compliance with all of the terms and
provisions of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Xxxxxx Boating Center Little Rock, Inc.
By:_________________________________
Title: President
55
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Red River Marine Center
Arkansas, Inc., an Arkansas corporation, ("Borrower"), hereby certify to
Deutsche Financial Services Corporation ("DFS"), in connection with the Loan and
Security Agreement dated as of January 31, 2000 between Xxxxxx Boats and Motors,
Inc. and its Subsidiaries set forth therein (individually, collectively, jointly
and severally "Borrower") and DFS (the "Agreement"; terms defined in the
Agreement are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7 of
the Agreement are correct on and as of the date hereof as though made on and as
of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the date
hereof, Borrower will be in full compliance with all of the terms and provisions
of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Red River Marine Arkansas, Inc.
By:____________________________
Title: President
56
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Shelby Marine Center,
Inc., a Tennessee corporation, ("Borrower"), hereby certify to Deutsche
Financial Services Corporation ("DFS"), in connection with the Loan and Security
Agreement dated as of January 31, 2000 between Xxxxxx Boats and Motors, Inc. and
its Subsidiaries set forth therein (individually, collectively, jointly and
severally "Borrower") and DFS (the "Agreement"; terms defined in the Agreement
are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7 of
the Agreement are correct on and as of the date hereof as though made on and as
of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the date
hereof, Borrower will be in full compliance with all of the terms and provisions
of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Shelby Marine Center, Inc.
By:_______________________
Title: President
57
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.10
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, Vice President and CFO of Xxxxxx Boating Center
Tennessee, Inc., the sole member of Shelby Marine Pickwick, LLC, a Tennessee
limited liability company, ("Borrower"), hereby certify to Deutsche Financial
Services Corporation ("DFS"), in connection with the Loan and Security Agreement
dated as of January 31, 2000 between Xxxxxx Boats and Motors, Inc. and its
Subsidiaries set forth therein (individually, collectively, jointly and
severally "Borrower") and DFS (the "Agreement"; terms defined in the Agreement
are used herein as so defined), that:
1. The representations and warranties of Borrower contained in Section 7 of
the Agreement are correct on and as of the date hereof as though made on and as
of such date;
2. No event has occurred and is continuing, or would result from any Loan
being made to Borrower under the Agreement on the date hereof, which constitutes
a Default; and
3. After the funding of the Loans to be made by DFS to Borrower on the date
hereof, Borrower will be in full compliance with all of the terms and provisions
of the Agreement.
IN WITNESS WHEREOF, I have signed this Certificate as of the 31st day of
January, 2000.
Shelby Marine Pickwick, LLC
Xxxxxx Boating Center Tennessee, Inc.
Member
By:__________________________________
Title: President
58
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:_______________________
Secretary
--------------------------
Company
59
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:_______________________
Secretary
TBC Arkansas, Inc.
60
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:__________________________________
Secretary
Xxxxxx Boating Center Arlington, Inc.
61
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:__________________________________
Secretary
Xxxxxx Boating Center Beaumont, Inc.
62
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:__________________________________
Secretary
Xxxxxx Boating Center Oklahoma, Inc.
63
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:__________________________________
Secretary
Xxxxxx Boating Center Tennessee, Inc.
64
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:__________________________________
Secretary
Xxxxxx Xxxxxxx Marine, Inc.
65
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:__________________________________
Secretary
Falcon Marine, Inc.
66
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:__________________________________
Secretary
Falcon Marine Abilene, Inc.
67
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:__________________________________
Secretary
Xxxxxx Boating Center Alabama, Inc.
68
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:__________________________________
Secretary
Xxxxxx Boating Center Louisiana, Inc.
69
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:____________________________________
Secretary
Xxxxxx Boats & Motors Baton Rouge, Inc.
70
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:____________________________________
Secretary
Xxxxxx Boating Center Mississippi, Inc.
71
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:____________________________________
Secretary
Xxxxxx Boating Center Little Rock, Inc.
72
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:____________________________________
Secretary
Red River Marine Arkansas, Inc.
73
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 6.1.11
SECRETARY'S CERTIFICATE OF RESOLUTION AND INCUMBENCY
I certify that I am the Secretary or Assistant Secretary of the
corporation named below, and that the following completely and accurately sets
forth certain resolutions of the Board of Directors of the corporation adopted
at a special meeting thereof held on due notice (and with shareholder approval,
if required by law), at which meeting there was present a quorum authorized to
transact the business described below, and that the proceedings of the meeting
were in accordance with the certificate of incorporation, charter and by-laws of
the corporation, and that they have not been revoked, annulled or amended in any
manner whatsoever.
Upon motion duly made and seconded, the following resolution was
unanimously adopted after full discussion:
"RESOLVED, That the several officers, directors, and agents of this
corporation, or any one or more of them, are hereby authorized and empowered on
behalf of this corporation: to obtain financing from Deutsche Financial Services
Corporation ('DFS') in such amounts and on such terms as such officers,
directors or agents deem proper; to enter into financing, security, pledge and
other agreements with DFS relating to the terms upon which such financing may be
obtained and security and/or other credit support is to be furnished by this
corporation therefor; from time to time to supplement or amend any such
agreements; execute and deliver any and all assignments and schedules; and from
time to time to pledge, assign, mortgage, grant security interests, and
otherwise transfer, to DFS as collateral security for any obligations of this
corporation to DFS, whenever and however arising, any assets of this
corporation, whether now owned or hereafter acquired; the Board of Directors
hereby ratifying, approving and confirming all that any of said officers,
directors or agents have done or may do with respect to the foregoing."
I do further certify that the following are the names and specimen
signatures of the officers and agents of said corporation so empowered and
authorized, namely:
President: Xxxx Xxxxxx /s/ Xxxx Xxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Secretary: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Treasurer: Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxx
------------------- ----------------------
(Print Name) (Signature)
Assistant Secretary: Xxxxx Xxxxxxxx /s/ Xxxxx Xxxxxxxx
-------------------- ----------------------
(Print Name) (Signature)
Witness by hand and seal of said corporation this 31st day of January, 2000.
(seal)
By:____________________________________
Secretary
Shelby Marine Center, Inc.
74
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 7.3
LITIGATION
NONE
75
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 7.5
LIENS
[To be provided by Borrower]
76
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 7.7
SUBSIDIARIES
[To be provided by Borrower]
77
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 7.9
Principal Place of Business
Borrower Chief Executive Office & Principal Place of Business
Xxxxxx Boats & Motors, Inc. 0000 Xxxxx xx xxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
TBC Arkansas, Inc. 0000 Xxxxx xx xxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
Xxxxxx Boating Center Arlington, Inc. 0000 Xxxxx xx xxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
Xxxxxx Boating Center Beaumont, Inc. 0000 Xxxxx xx xxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
Xxxxxx Boating Center Oklahoma, Inc. 0000 Xxxxx xx xxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
Xxxxxx Boating Center Tennessee, Inc. 0000 Xxxxx xx xxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
Xxxxxx Xxxxxxx Marine, Inc. 0000 Xxxxx xx xxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
Falcon Marine, Inc. 0000 Xxxxx xx xxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
Falcon Marine Abilene, Inc. 0000 Xxxxx xx xxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
Xxxxxx Boating Center Alabama, Inc. 0000 Xxxxx xx xxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
Xxxxxx Boating Center Louisiana, Inc. 0000 Xxxxx xx xxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
Xxxxxx Boats & Motors Baton Rouge, Inc. 0000 Xxxxx xx xxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
Xxxxxx Boating Center Mississippi, Inc. 0000 Xxxxx xx xxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
78
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 7.11
Federal Identification Number
Borrower Federal Identification Number
Xxxxxx Boats & Motors, Inc. 00-0000000
TBC Arkansas, Inc. 00-0000000
Xxxxxx Boating Center Arlington, Inc. 00-0000000
Xxxxxx Boating Center Beaumont, Inc. 00-0000000
Xxxxxx Boating Center Oklahoma, Inc. 00-0000000
Xxxxxx Boating Center Tennessee, Inc. 00-0000000
Xxxxxx Xxxxxxx Marine, Inc. 00-0000000
Falcon Marine, Inc. 00-0000000
Falcon Marine Abilene, Inc. 00-0000000
Xxxxxx Boating Center Alabama, Inc. 00-0000000
Xxxxxx Boating Center Louisiana, Inc. 00-0000000
Xxxxxx Boats & Motors Baton Rouge, Inc. 00-0000000
Xxxxxx Boating Center Mississippi, Inc. 00-0000000
79
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 7.17
COLLATERAL LOCATIONS
Borrower Addresses
Xxxxxx Boats & Motors, Inc. 00000 Xxxxxxxx Xxxx., Xxxxxx, XX 00000
0000 Xxxxx Xxxxxxx, Xxxxxxx, XX 00000
00000 XX 00 Xxxx, Xxx Xxxxxxx, XX 00000
Xxxxxx Boating Center Alabama, Inc. 0000 Xxxxxxxx Xxxx. (Xx. 0, Xxx 0),
Xxxxxxxx, XX 00000 (35630)
0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000
TBC Arkansas, Inc. 0000 Xxx. 00 Xxxxx, Xxxxx Xxxxxxx, XX
00000
0000 Xxxxxx Xxxx, Xxx Xxxxxxx, XX 00000
0000 X. Xxxxxxxxxx Xxxxxx, Xxxxxx Xxxx,
XX 00000
000 Xxxxxx Xxxxx Xxxx Xxxx, Xxxx Xxxxx,
XX 00000
Xxxxxx Boats & Motors Baton Rouge,
Inc. 00000 Xxxxxxx Xxxx., Xxxxx Xxxxx, XX
00000
Xxxxxx Boating Center Louisiana, Inc. 0000 Xxxx Xxxxx, Xxxxxxx Xxxx, XX 00000
0000 X. Xxxx Xxxxxx, Xxx Xxxxxx, XX 00000
00000 X. Xxxxxxx Xx., Xx. Xxxx, XX 00000
Xxxxxx Boating Center Mississippi,
Inc. 0000 Xxxxx Xxxxxxx, Xxxxxxxxxx, XX 00000
Xxxxxx Boating Center Oklahoma, Inc. 0000 XX Xxx 00, Xxxxxxxxx, XX 00000
Xxxxxx Boating Center Tennessee, Inc. 00000 Xxxxxxx 00 X., Xxxxxx, XX 00000
0000 Xxxxxx Xxx., Xxxxxxx, XX 00000
0000 X. Xxxx Xxxxxx, Xxxxxxxxxxxxxx, XX
00000
0000 X. Xxxxx Xxxxxxxxx Xxxx., Xxxxxxxxx,
XX 00000
00 Xxxxxx Xxxx, Xxxxxxxxxx, XX 00000
Falcon Marine Abilene, Inc. 0000 Xxxx Xxxxxxx 00, Xxxxxxx, XX 00000
Xxxxxx Boating Center Arlington, Inc. 0000 X. Xxxxxxxx, Xxxxxxxxx, XX 00000
Xxxxxx Boating Center Beaumont 0000 Xxxxxxx Xx., Xxxxxxxx, XX 00000
Xxxxxx Xxxxxxx Marine, Inc. 0000 X. Xxxxxxxx, Xxxxxxxxxx, XX 00000
Falcon Marine, Inc. 0000 X. Xxxx 000 X., Xxxxxxx, XX 00000
80
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 7.18
REAL PROPERTY OWNED OR LEASED
Borrower Addresses Owned/Leased
Xxxxxx Boats & Motors, Inc. 00000 Xxxxxxxx Xxxx., Xxxxxx, XX 00000 Owned
0000 Xxxxx Xxxxxxx, Xxxxxxx, XX 00000 Leased
00000 XX 00 Xxxx, Xxx Xxxxxxx, XX 00000 Owned
Xxxxxx Boating Center Alabama, Inc. 0000 Xxxxxxxx Xxxx. (Xx. 0, Xxx 0),
Xxxxxxxx, XX 00000 (35630) Leased
0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000 Leased
TBC Arkansas, Inc. 0000 Xxx. 00 Xxxxx, Xxxxx Xxxxxxx, XX 00000 Leased
0000 Xxxxxx Xxxx, Xxx Xxxxxxx, XX 00000 Owned
0000 X. Xxxxxxxxxx Xxxxxx, Xxxxxx Xxxx, XX 00000 Owned
000 Xxxxxx Xxxxx Xxxx Xxxx, Xxxx Xxxxx, XX 00000 Leased
Xxxxxx Boats & Motors
Baton Rouge, Inc. 00000 Xxxxxxx Xxxx., Xxxxx Xxxxx, XX 00000 Owned
Xxxxxx Boating Center Louisiana, Inc. 0000 Xxxx Xxxxx, Xxxxxxx Xxxx, XX 00000 Owned
0000 X. Xxxx Xxxxxx, Xxx Xxxxxx, XX 00000 Leased
00000 X. Xxxxxxx Xx., Xx. Xxxx, XX 00000 Leased
Xxxxxx Boating Center Mississippi, Inc. 0000 Xxxxx Xxxxxxx, Xxxxxxxxxx, XX 00000 Owned
Xxxxxx Boating Center Oklahoma, Inc. 0000 XX Xxx 00, Xxxxxxxxx, XX 00000 Owned
Xxxxxx Boating Center Tennessee, Inc. 00000 Xxxxxxx 00 X., Xxxxxx, XX 00000 Leased
0000 Xxxxxx Xxx., Xxxxxxx, XX 00000 Leased
0000 X. Xxxx Xxxxxx, Xxxxxxxxxxxxxx, XX 00000 Leased
0000 X. Xxxxx Xxxxxxxxx Xxxx., Xxxxxxxxx, XX 00000 Leased
00 Xxxxxx Xxxx, Xxxxxxxxxx, XX 00000 Leased
Falcon Marine Abilene, Inc. 0000 Xxxx Xxxxxxx 00, Xxxxxxx, XX 00000 Owned
Xxxxxx Boating Center Arlington, Inc. 0000 X. Xxxxxxxx, Xxxxxxxxx, XX 00000 Leased
Xxxxxx Boating Center Beaumont 0000 Xxxxxxx Xx., Xxxxxxxx, XX 00000 Owned
Xxxxxx Xxxxxxx Marine, Inc. 0000 X. Xxxxxxxx, Xxxxxxxxxx, XX 00000 Owned
Falcon Marine, Inc. 0000 X. Xxxx 000 X., Xxxxxxx, XX 00000 Owned
81
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 8.1.10(c)
LOAN AND SECURITY AGREEMENT CERTIFICATIONS
AS OF , 20
In accordance with Section 8.1.10(c) of the Loan and Security Agreement
dated as of January 31, 2000 ("Agreement"), among Xxxxxx Boats & Motors, Inc.
and its Subsidiaries listed therein (individually, collectively, jointly and
severally "Borrower") and Deutsche Financial Services Corporation, I certify
that:
(i) all Borrower prepared quarterly financial statements
(Consolidated Balance Sheet and Consolidated Statement of Operations) for the
quarter ending _______________, 20__, all unaudited, fairly present the
financial position and results of operations of Borrower and its Subsidiaries
and have been prepared in accordance with generally accepted accounting
principles consistently applied.
(ii) to the best of my knowledge, and after review of the Agreement,
Borrower has kept, observed, performed and fulfilled each and every covenant,
obligation and agreement binding upon Borrower under the Agreement and that no
Default has occurred.
Xxxxxx Boats & Motors, Inc.
a Texas corporation
On Behalf of Itself and the Other Borrowers
By:________________________________________
Title:_____________________________________
82
Confidential Treatment Requested.
Confidential portions of this documents have been redacted and filed separately
with the Commission.
EXHIBIT 9.3
COVENANT COMPLIANCE CERTIFICATE
[To be provided by DFS]
83
