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Exhibit 10.4
Re: XTRA, Inc. and XTRA International Ltd./Marine Container Fleet
FLEET FINANCE SERVICES AGREEMENT
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This Fleet Finance Services Agreement (the "Agreement") made as of the
first day of July, 0000,
X X X X X X X:
XTRA, INC., a Maine corporation, ("XTRA"),
- and -
XTRA INTERNATIONAL LTD., a Delaware corporation, ("XTRA International"),
WHEREAS XTRA and XTRA International are members of an affiliated group
of corporations (the "Affiliated Group") controlled by XTRA Corporation, a
Delaware corporation, ("Parent Corporation");
AND WHEREAS XTRA is engaged in providing financing services for the
Affiliated Group and owns transportation equipment consisting of marine
containers (hereinafter referred to as XTRA's Container Fleet );
AND WHEREAS XTRA International is engaged in the business of providing
international transportation leasing services, on an operating basis, of marine
containers (hereinafter referred to as XTRA International's Leasing
Business );
AND WHEREAS XTRA International wishes to engage XTRA to provide it with
fleet finance services in the U.S. in connection with XTRA International's
Leasing Business as more particularly described herein;
AND WHEREAS XTRA wishes to provide such fleet finance services and make
available XTRA's Container Fleet to XTRA International for use in connection
with XTRA International's Leasing Business as more particularly described
herein;
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AND WHEREAS the parties wish to enter into this Agreement to define the
terms upon which XTRA will provide such fleet finance services and XTRA's
Container Fleet to XTRA International;
NOW THEREFORE in consideration of the mutual covenants contained herein
and other good and valuable consideration, the receipt and sufficiency whereof
each of the parties hereto hereby acknowledges, the parties hereto covenant and
agree as follows:
I. CONTAINER FLEET MANAGEMENT:
1. SERVICES. XTRA International for a period of ten (10) years from
July 1, 1995, subject to earlier termination as hereinafter set forth, shall be
entitled to operate XTRA's Container Fleet in XTRA International s Leasing
Business in accordance with the terms and conditions of this Agreement,.
2. FUNCTIONS. In connection with the operation of XTRA's Container
Fleet, XTRA International shall:
(a) lease the equipment, as lessor, in a manner consistent with XTRA
International's Leasing Business;
(b) employ and be responsible for the activities of all personnel
required for the daily operation of XTRA's Container Fleet;
(c) supervise customer relations and arrange for advertising, sales,
and solicitations;
(d) pay and be responsible for all operating expenses associated with
the operation of XTRA International's Leasing Business, including
XTRA's Container Fleet; and
(e) take such further action as deemed necessary for the efficient and
economical functioning of XTRA's Container Fleet including the repair
and maintenance of XTRA s Container Fleet.
XTRA shall not solicit business for XTRA International from its
customers or prospective customers or enter into contracts of sale or lease (or
comparable arrangements) with any customers on behalf of XTRA International.
3. REVENUES. All receipts, income and revenues derived from XTRA's
Container Fleet by XTRA International shall be the sole and exclusive property
of XTRA International.
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4. In no event will XTRA International incur any indebtedness for
money borrowed or subject XTRA's Container Fleet to any lien, security interest
or encumbrance, except for third party leases in the ordinary course of XTRA
International's Leasing Business.
II. ANNUAL COMPENSATION:
In return for the right to operate XTRA's Container Fleet and receive
fleet financing services XTRA International shall pay to XTRA compensation for
the use of XTRA's Container Fleet an amount equal to equipment depreciation
expense calculated each fiscal year in accordance with the Internal Revenue
Code of 1986 on equipment additions to XTRA's Container Fleet, plus allocated
interest expense and other associated financing costs related to XTRA s
Container Fleet. Such amounts shall be paid by the last day of the month
following the end of each fiscal quarter which ends on the last day of
December, March, June, and September.
III. AUTHORITY:
XTRA International shall have full right and authority, in its own name
and on its own behalf, to sign and enter into lease contracts with respect to
XTRA's Container Fleet in connection with XTRA International's Leasing
Business.
IV. RECORDS AND ACCOUNTING:
XTRA International shall keep and maintain full and complete books,
records, and accounts in a manner consistent with Generally Accepted Accounting
Principles. XTRA International shall render to XTRA upon its request complete
quarterly and annual operating and financial statements, with such information
with respect to XTRA's Container Fleet as XTRA shall request and such other
reports pertaining to XTRA International's Leasing Business as XTRA may from
time to time reasonably request and in the form so requested.
V. INSURANCE:
To the extent not otherwise provided XTRA shall maintain in force all
necessary insurance.
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VI. TERMINATION:
Either party may terminate this Agreement immediately upon thirty (30)
days written notice to the other party.
VII. ASSIGNMENT OF LEASES:
XTRA International hereby assigns to XTRA all of XTRA International's
right, title, and interest in all leases entered into by XTRA International
relating to XTRA's Container Fleet; provided however, that prior to the
termination of this Agreement pursuant to the terms of Section VI above, XTRA
International shall have the right to collect and retain all amounts payable
under such leases as they become due and payable. Upon termination of this
Agreement for any reason, XTRA shall be entitled to operate the XTRA s
Container Fleet and collect all amounts due under the Leases, including those
past due.
VIII. GENERAL CLAUSES:
1. ASSIGNMENT. The parties hereto agree that this Agreement
shall not be assignable by either party without the prior written consent of
the other party hereto.
2. AMENDMENT. This Agreement may be amended at any time by mutual
consent of the parties.
3. NOTICE. Any demand, notice or other communication (hereinafter
referred to as a "Communication") to be given in connection with this Agreement
shall be given in writing and shall be given by personal delivery, by
registered mail or by transmittal by telex or telecopier or other form of
recorded Communication addressed to the recipient as follows:
To XTRA:
Pierce, Atwood, Scribner, Allen, Xxxxx & Xxxxxxxxx
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxx 00000
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To XTRA International:
000 Xxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxxxxxx X. Xxxxxxxxx
or to such other address, telex or telecopier number or individual as may be
designated by notice given by either party to the other. Any Communication
given by personal delivery shall be conclusively deemed to have been given on
the day of actual delivery thereof and, if given by registered mail, on the
fifth business day following the deposit thereof in the mail and, if given
by telex or other form of recorded Communication, shall be deemed given and
received on the date of such transmission if received during the normal
business hours of the recipient and on the next business day if it is received
after the end of such normal business hours on the date of its transmission.
If the party given the Communication knows or ought reasonably to know of any
difficulties with the postal system which might affect the delivery of mail,
any such Communication shall not be mailed but shall be given by personal
delivery or by telex or telecopier transmittal.
4. TIME OF THE ESSENCE. Time shall be of the essence hereof.
5. FURTHER ASSURANCES. The parties agree to sign or execute all
such other documents and such other things as may be necessary or desirable for
more completely and effectually carrying out the terms and intentions of this
Agreement. Furthermore, the parties shall act, and shall use their best
efforts to cause their nominees to act, to carry out the terms and spirit and
purpose of this Agreement.
6. WAIVER. The failure of any party to enforce any rights or
obligations under this Agreement shall not constitute a waiver of that or any
other right or obligation hereunder.
7. SEVERABILITY. Any provision or provisions of this Agreement
which contravene any applicable law or which are found to be unenforceable
shall, to the extent of such contravention or unenforceability, be deemed
severable and shall not cause this Agreement to be held invalid or
unenforceable or affect any other provision or provisions of this Agreement.
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8. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties and there are no representations, warranties,
conditions, or collateral agreements relating to the subject matter hereof,
except as herein contained or as may be consented to as provided herein.
9. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of Delaware.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by an officer, as of the date set forth above, each pursuant to
due corporate authority.
XTRA, Inc.
By /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx, Vice President,
General Counsel and
Asst. Clerk
XTRA International Ltd.
By /s/ Xxxxxxxxx X. Xxxxxxxxx
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Xxxxxxxxx X. Xxxxxxxxx, President
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