BANK CREDIT AGREEMENT
BY AND BETWEEN
XXXXXXX LEASING CORP.
FIRST UNION NATIONAL BANK
AS ADMINISTRATIVE AGENT
AND
BANKBOSTON, N.A.
AS DOCUMENTATION AGENT
DATED AS OF DECEMBER 11, 1998
TABLE OF CONTENTS
PAGE
ARTICLE ONE
AMOUNT AND TERMS OF CREDIT 1
Section 1.1 Amount and Terms of Credit
Section 1.2 Place of Loans
Section 1.3 Loan Request
Section 1.4 Interest
Section 1.5 Loan Account
Section 1.6 Statement of Loan Account
ARTICLE TWO
LOAN PAYMENTS 3
Section 2.1 Repayment of Principal/Schedule Amortization
Section 2.2 Interest Periods and Payments
Section 2.3 Optional Prepayment
Section 2.4 Mandatory Prepayment
Section 2.5 Place and Form of Payments
Section 2.6 Repayment Restrictions
Section 2.7 Additional Compensation
ARTICLE THREE
DEFAULT 5
Section 3.1 Default by Lenders
ARTICLE FOUR
COLLATERAL SECURITY 5
Section 4.1 Agreement to Secure
Section 4.2 Agent for Lenders
Section 4.3 Instruments of Security; Perfection of Security
Interests;
Further Assurance
Section 4.4 Provisions of Collateral Security
Section 4.4.1 Assigned Eligible Equipment Information
Section 4.4.2 Eligible Equipment Insurance
Section 4.4.3 Procedural Changes
Section 4.4.4 Releases
Section 4.4.5 Termination of Security Interest
Section 4.4.6 Waivers of Demands, Notices, Etc.
Section 4.5 Lenders' Rights in Deposits and Other Property;
Set-Off
Section 4.6 Pro Rata Payments
Section 4.7 Administrative Expenses
ARTICLE FIVE
APPOINTMENT OF FIRST UNION AS ATTORNEY 8
Section 5.1 Appointment of First Union as Attorney
ARTICLE SIX
REPRESENTATIONS AND WARRANTIES OF XXXXXXX 9
Section 6.1 Valid Organization, Good Standing and
Qualifications
Section 6.2 Business of Xxxxxxx
Section 6.3 No Pending Material Litigation or Proceedings
Section 6.4 No Adverse Contracts or Restrictions
Section 6.5 No Legal Restrictions on Performance
Section 6.6 No Default under Other Obligations
Section 6.7 Government Consents
Section 6.8 Tax Status
Section 6.9 ERISA
Section 6.10 Financial Condition
Section 6.11 Environmental Matters
Section 6.12 Title to Properties
Section 6.13 Regulation U
Section 6.14 Investment Company, Public Utility and Holding
Company
Section 6.15 Accurate and Complete Disclosure
Section 6.16 Year 2000 Program
ARTICLE SEVEN
AFFIRMATIVE COVENANTS OF XXXXXXX 11
Section 7.1 Payment of Principal and Interest
Section 7.2 Payment of Taxes
Section 7.3 Corporate Existence
Section 7.4 Maintenance of Properties
Section 7.5 Insurance
Section 7.6 Accounts and Financial Statements
Section 7.7 Default Under Other Indebtedness
Section 7.8 Inspection
Section 7.9 Liens
Section 7.10 Borrowing Base Certificate
Section 7.11 Performance of Lease Obligations; Collections
Section 7.12 Certification of Independent Public Accountants
Section 7.13 Certificate of Xxxxxxx as to Title Certificates
Section 7.14 Commitment Fee
Section 7.15 Maintenance of Working Capital
Section 7.16 Maintenance of Net Worth
Section 7.17 Current Ratio
Section 7.18 Further Assurance
ARTICLE EIGHT
NEGATIVE COVENANTS OF XXXXXXX 15
Section 8.1 Indebtedness to Net Worth Ratio
Section 8.2 Disposition of Properties or Assets
Section 8.3 Merger, Consolidation
Section 8.4 Business Acquisitions
Section 8.5 Business of Xxxxxxx
Section 8.6 Limitation on Payments to Stockholder
Section 8.7 Leases to Affiliates
Section 8.8 Restricted Payments
Section 8.9 Negative Pledge
Section 8.10 Limitation on Liens
ARTICLE NINE
CONDITIONS OF CLOSING 16
Section 9.1 First Loan
Section 9.2 First and Subsequent Loans
Section 9.3 Facility B Loans
ARTICLE TEN
DEFAULTS AND REMEDIES 17
Section 10.1 Events of Default
Section 10.2 Effect of Event of Default
Section 10.3 Uniform Commercial Code
Section 10.4 Delay or Omission Not Waiver
Section 10.5 Remedies Cumulative
ARTICLE ELEVEN
TERMINATION 19
Section 11.1 Termination by Xxxxxxx
ARTICLE TWELVE
PAYMENTS OF CERTAIN EXPENSES BY XXXXXXX 19
Section 12.1 Expenses in Connection with Enforcement
ARTICLE THIRTEEN
SURVIVAL OF COVENANTS; SUCCESSORS AND ASSIGNS 20
Section 13.1 Survival of Covenants, Etc.
Section 13.2 No Assignment by Xxxxxxx
ARTICLE FOURTEEN
MODIFICATIONS; WAIVER 20
Section 14.1 Modification of this Agreement
ARTICLE FIFTEEN
COMMUNICATIONS AND NOTICES 20
Section 15.1 Form, Address, Etc.
ARTICLE SIXTEEN
DEFINITIONS 21
Section 16.1 Acquisition Cost
Section 16.2 Affiliate
Section 16.3 Aggregate Amortization
Section 16.4 Amortized Value
Section 16.5 Amortization Period
Section 16.6 Assigned Eligible Equipment
Section 16.7 Borrowing Base
Section 16.8 Combined Debt
Section 16.9 Commitment Amount
Section 16.10 Corporation
Section 16.11 Current Assets
Section 16.12 Current Liabilities
Section 16.13 Default
Section 16.14 Commercial Rental Fleet
Section 16.15 Eligible Equipment
Section 16.16 Event of Default
Section 16.17 Indebtedness
Section 16.18 Lease
Section 16.19 Lease in Good Standing
Section 16.20 Lenders
Section 16.21 LIBOR
Section 16.22 Loan
Section 16.23 Loan Account
Section 16.24 Loan Date
Section 16.25 Loan Request
Section 16.26 Maturity Date
Section 16.27 Monthly Amortization Figure
Section 16.28 Mortgage
Section 16.29 Motor Vehicle
Section 16.30 Net Book Value
Section 16.31 Net Worth
Section 16.32 Person
Section 16.33 Prime Rate
Section 16.34 Revolving Expiration Date
Section 16.35 Senior Indebtedness
Section 16.36 Subordinated Indebtedness
Section 16.37 Subsidiary
Section 16.38 Working Capital
Section 16.39 Year 2000 Problem
Section 16.40 Agent for the Lenders
Section 16.41 Facility A
Section 16.42 Facility B
ARTICLE SEVENTEEN
HOLIDAYS 25
Section 17.1 Holidays
ARTICLE EIGHTEEN
LAW GOVERNING 25
Section 18.1 Pennsylvania Law
ARTICLE NINETEEN
WAIVER 25
Section 19.1 Waiver of Jury Trial
ARTICLE TWENTY
HEADINGS 25
Section 20.1 Headings Not Part of Agreement
ARTICLE TWENTY-ONE
COUNTERPARTS 25
Section 21.1 Counterparts
BANK CREDIT AGREEMENT
THIS BANK CREDIT AGREEMENT dated as of December 11, 1998, by and
between XXXXXXX LEASING CORP., a Delaware corporation ("Xxxxxxx") and
FIRST UNION NATIONAL BANK, a national banking association ("First
Union") and BANKBOSTON, N.A., a national banking association
("BankBoston"), (each such financial institution being hereinafter
called a "Lender" and collectively called the "Lenders").
Capitalized terms used herein without definition shall have the
meanings specified in Article 16 hereof.
1. AMOUNT AND TERMS OF CREDIT.
1.1 Amount of Credit. Subject to and upon the terms and
conditions hereof, the Lenders will lend to Xxxxxxx, at any time and
from time to time before the Revolving Expiration Date, sums which
shall not exceed
(a) Committed Loans ("Facility A") in an aggregate
outstanding principal amount of up to the lesser of (i) the
Commitment Amount; and (ii) the Borrowing Base in effect from time to
time (the "Borrowing Base Amount") less the amount of the Loans
outstanding under Facility B, if any (hereinafter the "Commitment").
The Facility A Commitment shall be divided equally between the
Lenders such that each Lender's commitment under Facility A shall be
an amount equal to the lesser of (x) $25,000,000 less such Lender's
Loans outstanding under Facility A or (y) one half of the Borrowing
Base Amount less the amount of Loans outstanding or that Lender under
Facility A and B,
(b) uncommitted lines of credit up to $50,000,000 in the
aggregate ("Facility B"). The Facility B Commitment shall be divided
equally among the Lenders such that each Lender's availability under
Facility B shall be an amount equal to the lesser of (x) $25,000,000,
less such Lender's outstandings under Facility B or (y) one half of
the Borrowing Base, less the amount of Loans of the Lender under
Facility A and B, if any, to be offered separately by each Lender;
provided, however, that under no circumstances shall the aggregate
outstanding principal amount of Facility A Loans and Facility B
Loans, if any, at any time exceed the Borrowing Base Amount.
Notwithstanding any other provision of this Agreement or any course
of dealing which may now or hereafter arise, it is acknowledged and
agreed that (i) Facility B is an uncommitted line of credit; (ii)
each request for a Loan under Facility B is subject to the prior
approval of each Lender; and (iii) each Lender may, in its sole and
absolute discretion and without notice of any kind, decline to permit
any borrowing under Facility B notwithstanding the approval or denial
of any other Lender under Facility B. To the extent that any Loan is
made pursuant to Facility B the interest rate and term thereof shall
be as mutually agreed at the time such Loan is made.
(c) Notwithstanding any other provision hereof, the
obligation of each Lender to make any Facility A Loan pursuant hereto
shall be several, and not joint or joint and several.
(d) Xxxxxxx may, by written notice to the Lenders, not more
than 60 days or less than 45 days prior to the then effective
Revolving Expiration Date, request an extension of the Revolving
Expiration Date for an additional period of 364 days from the then
current Revolving Expiration Date. Each Lender shall notify Xxxxxxx
of its approval or denial of such extension request (which approval
or denial shall be in the sole and absolute discretion of such
Lender) no later than 30 days prior to the then effective Revolving
Expiration Date. The extension of the Revolving Expiration Date
shall be effective only if approved by both Lenders. Any extension
so approved shall become effective beginning on the date next
following the then effective Revolving Expiration Date.
1.2 Place of Loans. Each Loan will be made to Xxxxxxx at the
office of First Union at 0000 Xxxxxxxx Xxxxxx, Xxxxxxxxxxxx, XX 00000
or the office of BankBoston, 000 Xxxxxxx Xxxxxx, Xxxxxx, XX 00000, as
the case may be, in such principal amount as Xxxxxxx may request by
notice (in the form and subject to the limitations herein provided)
received by the Lenders at least one (1) business day prior to the
Loan Date therefor.
1.3 Loan Request. Each Loan Request will be substantially in
the form of Exhibit "A" attached hereto, signed on Xxxxxxx' behalf by
a person thereunto duly authorized by it, setting forth (each a "Loan
Request"):
(a) The amount of the Loan requested;
(b) The requested interest rate option to apply thereto;
(c) The Loan Date therefor;
(d) The principal amount of Loans outstanding hereunder at
the date of such Loan Request;
(e) Such other matters as are called for by the form of
Exhibit "A" or as may be reasonably requested by the Lenders;
(f) Interest Period;
(g) reference to whether it is under Facility A or Facility
B.
Absent a contrary Loan Request by Xxxxxxx prior to the last
day of the Interest Period applicable to any As-Offered Rate Loan,
Xxxxxxx shall be deemed to have requested a Prime Rate Loan equal to
such As-Offered Rate Loan effective as of the last day of such
Interest Period.
1.4 Interest. Outstanding amounts under Facility A shall
accrue interest according to the following options, as selected by
the Borrower and Facility B Loans, if any, shall accrue interest at
the option described in (b) below:
(a) Prime Rate Option
A rate per annum (computed on the basis of the actual number
of days elapsed in a year of 365 or 366 days) for each day equal to
the Prime Rate.
(b) As-Offered Rate Option
A per annum rate of interest fixed in reference to LIBOR as
quoted separately by each Lender and acceptable to the Borrower as of
the date of each Loan. Interest at the As-Offered Rate Option quoted
by each Lender shall accrue on each Lender's portion of the entire
outstanding principal balance of each As-Offered Rate Loan and shall
be calculated on the actual number of days elapsed in a year of 360
days.
1.5 Loan Account. Each Lender will maintain on its books a Loan
Account for Xxxxxxx in which will be recorded the Loans made by such
Lender pursuant hereto, interest accrued thereon, payments made on
account of the principal of and interest on such Loans and other
appropriate debits and credits as provided by this Agreement which
records of each Lender shall be conclusive absent manifest error.
All Facility A indebtedness incurred by Xxxxxxx hereunder will be
governed exclusively by the terms hereof, including the additional
documents and instruments provided herein to be executed and
delivered to each Lender, and the Facility A Loans made hereunder may
at the request of a Lender be evidenced by notes or other evidences
of indebtedness. The debit balance of the Loan Account maintained by
each Lender will reflect the amount of Xxxxxxx' indebtedness to such
Lender from time to time by reason of transactions occurring pursuant
hereto.
1.6 Statement of Loan Account. On or before the 10th day of
each month each Lender will use its best efforts to render to Xxxxxxx
a statement of the Loan Account maintained by such Lender, as of the
close of business on the last day of the preceding month, showing
separately the unpaid balance of principal of the Loans and the
interest accrued thereon. Such statement will be deemed to be
correct and accepted by Xxxxxxx and conclusively binding upon it
unless Xxxxxxx notifies the Lenders to the contrary, specifying in
detail the nature of any claimed error or discrepancy, within twenty
(20) days after Xxxxxxx' receipt thereof.
2. LOAN PAYMENTS
2.1 Repayment of Principal/Scheduled Amortization. (a) The
aggregate outstanding principal amount of all Facility A Loans as of
the Revolving Expiration Date shall be due and payable in sixteen
(16) equal quarterly installments (each an "Installment") commencing
the last business day of the calendar quarter following the Revolving
Expiration Date and continuing on the last business day of each
consecutive September, December, March and June thereafter to and
including the Maturity Date (each an "Installment Payment Date"). To
the extent not due and payable earlier, the outstanding principal
balance of the Facility A Loans, together with all interest accrued
thereon, shall be due and payable on the Maturity Date. All
prepayments, if any, made by the Borrower during the Amortization
Period, shall be applied against Installments in the inverse order of
their maturity.
(b) The outstanding principal balance of each Facility B
Loan shall be due and payable at such time or times as is specified
by each Lender and agreed upon by Xxxxxxx at the time such Facility B
Loans, if any, are made.
2.2 Interest Periods. (a) Loans bearing interest at the Prime
Rate Option shall have an interest period of up to 90 days as
selected by Xxxxxxx. Loans bearing interest at the As-Offered Rate
Option shall have such interest period as may be prescribed by each
Lender and agreed to by Xxxxxxx at the time such Loan is made (each
hereinafter an "Interest Period").
(b) Interest Payments. Interest accrued on each Facility A
Loan made pursuant hereto shall be due and payable on the last
business day of each calendar quarter during which any such Loan is
outstanding, on each Installment Payment Date, on the last day of the
Interest Period applicable thereto and on the date of repayment,
prepayment or conversion thereof and on the Maturity Date. After the
principal amount of any Loan shall have become due and payable on any
Installment Payment Date, the Maturity Date, by acceleration or
otherwise, interest shall accrue on all outstanding principal amounts
at a per annum rate equal to the Prime Rate plus 2%, and shall be due
and payable on demand.
2.3 Optional Prepayment. Prime Rate Loans may be prepaid
at any time on one business day's notice. As-Offered Rate Loans may
be prepaid prior to the last day of the Interest Period applicable
thereto on not less than 3 days prior written notice thereof to the
Lenders and subject to Section 2.7(b) hereof.
2.4 Mandatory Prepayment. If at any time the aggregate
outstanding principal amount of Facility A Loans and Facility B Loans
exceeds the Borrowing Base Amount, Borrower shall, within one
business day, prepay such amount as is necessary to cause the
aggregate outstanding principal balance of all such Loans, after
giving effect to such prepayment, to be less than the Borrowing Base
Amount as of such date. Prepayment shall be first of Facility B
Loans and then Facility A Loans.
2.5 Place and Form of Payments. All payments to be made by
Xxxxxxx pursuant hereto will be paid in lawful money of the United
States of America, in immediately available funds, at the office of
First Union, 0000 Xxxxxxxx Xxxxxx, Xxxxxxxxxxxx, XX, or BankBoston,
000 Xxxxxxx Xxxxxx, Xxxxxx, XX, as the case may be, or at such other
place as either Lender may designate in written notice to Xxxxxxx.
2.6 Repayment Restrictions. Amounts repaid in respect of
Facility A Loans from and after the Revolving Expiration Date,
whether as scheduled Installments, by prepayment or otherwise, may
not be reborrowed hereunder.
2.7 Additional Compensation in Certain Circumstances.
(a) Increased Costs or Reduced Return Resulting from Taxes,
Reserves, Capital Adequacy Requirements, Expenses, etc. If (i) the
introduction of or any change in any law or regulation or in the
interpretation or application thereof by any governmental or
regulatory authority ("Official Body") charged with the
interpretation or administration thereof, or (ii) compliance with any
guideline or request or directive of any Official Body (whether or
not having the force of law) hereafter:
(i) subjects any Lender to any tax or changes the
basis of taxation with respect to this Agreement, any Loan made
pursuant hereto or payments by Xxxxxxx of principal, interest or
other amounts due from Xxxxxxx hereunder or under any note made in
connection herewith (except for taxes on the overall net income of
any Lender imposed by the jurisdiction in which such Lender's
principal office is located),
(ii) imposes, modifies or deems applicable any
reserve, special deposit or similar requirement against assets held
by, credit extended by, deposits with or for the account of, or other
acquisition of funds by, any Lender,
(iii) imposes, modifies or deems applicable any
capital adequacy or similar requirement (A) against assets (funded or
contingent) of, or credits by, any Lender or (B) otherwise applicable
to the obligations of any Lender under this Agreement, or
(iv) imposes upon any Lender any other condition
or expense with respect to this Agreement, any note held by any
Lender pursuant hereto or its making, maintenance or funding of any
Loan
and the result of any of the foregoing is to increase the cost to,
reduce the income receivable by, or impose any expense, including
loss of margin, upon the Lender with respect to this Agreement, or
the making, maintenance or funding of any part of any Loan(s) or, in
the case of any capital adequacy or similar requirement, has the
effect of increasing the amount of capital required or expected to be
maintained by any Lender or any Corporation controlling any such
Lender as a result of such Lender's commitment to lend hereunder or
the Loan(s) made by such Lender pursuant hereto (taking into account
the Lender's policies with respect to capital adequacy) by an amount
which the Lender deems to be material such Lender shall from time to
time notify Xxxxxxx of the amount determined (using any averaging and
attribution methods) by such Lender in good faith (which
determination shall be conclusive) to be necessary to compensate such
Lender for such increase in cost, reduction in income or additional
expense reasonably allocable to the making, maintenance or funding of
the Loan or any portion thereof hereunder provided, however, that no
Lender shall be entitled to demand such compensation more than 180
days following the last day of the Interest Period in respect of
which such demand is made; provided further, however, that the
foregoing proviso shall in no way limit the right of any Lender to
demand or receive such compensation to the extent that such
compensation relates to the retroactive application of any law,
regulation, guideline or request described in (i) or (ii) above if
such demand is made within 180 days after the implementation or
application of such retroactive law, interpretation, guideline or
request. Such amount shall be due and payable by Xxxxxxx to the
applicable Lender ten (10) Business Days after such notice is given.
(b) Indemnity. In addition to the compensation required by
subsection (a) of this Section 2.7, Xxxxxxx shall indemnify each
Lender against any loss or expense (including loss of margin) which
any Lender has sustained or incurred as a consequence of any
(i) payment, prepayment or conversion of any Loan, if
maintained at the As-Offered Rate Option, on a day other than the
last day of the corresponding Interest Period (whether or not such
payment, prepayment or conversion is mandatory and whether or not
such payment, prepayment or conversion is then due),
(ii) attempt by Xxxxxxx to revoke (expressly, by
later inconsistent notices or otherwise) in whole or part any notice
stated herein to be irrevocable (each Lender having in its discretion
the options (A) to give effect to any such attempted revocation and
obtain indemnity under this Section 2.7(b) or (B) to treat such
attempted revocation as having no force or effect, as if never made),
or
(iii) claims, demands, losses or expenses incurred
by or asserted against any Lender in connection with Xxxxxxx' use of
the proceeds of any Loan and/or any Lender's role as a lender
hereunder except to the extent caused by the Lender's gross
negligence or willful misconduct.
If any Lender sustains or incurs any such loss or expense, it shall
from time to time notify Xxxxxxx of the amount determined by such
Lender in good faith (which determination shall be conclusive) to be
necessary to indemnify such Lender for such loss or expense (such
Lender being deemed for this purpose to have made, maintained or
funded the Loan to the extent maintained at the As-Offered Rate
Option from a corresponding source of funds). Such amount shall be
due and payable by Xxxxxxx to the Lender ten Business Days after such
notice is given.
3. Intentionally Left Blank
4. COLLATERAL SECURITY.
4.1 Agreement to Secure. At any time after the date of this
Agreement any of the Lenders may, by written notice to Xxxxxxx,
require that all of Xxxxxxx' liability and obligations hereunder be
fully secured by Xxxxxxx. Upon delivery of such notice by any Lender
to Xxxxxxx, the Lenders shall have, and Xxxxxxx shall and does hereby
(effective upon the delivery of such notice), assign, transfer and
grant to the Lenders, jointly, a security interest and first priority
lien in and to the following and all proceeds thereof, to secure the
payment of the principal of and interest on the Loans which at any
time may be outstanding hereunder or pursuant hereto and the
performance of all other obligations of Xxxxxxx hereunder; (i) all
Eligible Equipment which is at any time described, referred to or
reflected in any Loan Request or Borrowing Base Certificate, or
otherwise identified in any manner on the books or records of Xxxxxxx
as an item of Eligible Equipment included in Xxxxxxx' Borrowing Base,
and all parts, fittings, accessories, accessions, substitutions and
replacements therefor or thereof, and all proceeds of any therefor,
and (ii) all Leases now or hereafter in effect with respect to such
Eligible Equipment (and such other property as may be subject to any
such Lease) and all rentals and other moneys, including all proceeds
of insurance, condemnation and requisition proceedings and sales or
other dispositions of any such Eligible Equipment (and such other
property) payable to or receivable by Xxxxxxx under or in connection
with any such Lease and all instruments, accounts, general
intangibles and/or chattel paper relating thereto or forming a part
thereof, and all Xxxxxxx' rights and powers therein and thereunder,
including all rights of Xxxxxxx to give and receive any notice,
consent, waiver, demand or approval under or in respect of any such
Lease, to exercise any election or option thereunder or in respect
thereof, to accept any surrender of such Eligible Equipment (and such
other property), to execute and deliver any xxxx of sale for any such
Eligible Equipment (and such other property), and to do all other
things which Xxxxxxx is entitled to do under any such Lease, Xxxxxxx
hereby irrevocably constituting and appointing each of the Lenders as
its attorney-in-fact for such purposes, with full power of
substitution, together with full power and authority, in the name of
Xxxxxxx, the Lenders or otherwise, to do, enforce, collect, receive
and receipt for any and all of the foregoing.
4.2 Agent for Lenders. At the request of the Lenders, Xxxxxxx
will execute, acknowledge and deliver to such agent for the Lenders
as the Lenders may designate such instruments of assignment,
conveyance, mortgage and appointment, as the Lenders may request, to
grant, perfect and confirm the grant, to such agent of such rights
and powers referred to in Section 4.1 as the Lenders may request.
4.3 Instruments of Security; Perfection of Security Interests;
Further Assurance. Within 7 days after the delivery to Xxxxxxx of
the notice of any Lender provided for in Section 4.1, Xxxxxxx will
execute, acknowledge, deliver, file and record all such documents,
including mortgages, instruments of assignment and transfer,
financing statements, certificates of title (with encumbrances noted
thereon) as the Lenders or the agent for the Lenders may request to
effect, grant and convey, perfect and continue perfected under
applicable law, the security interests provided for in Section 4.1 as
first lien security interests in the property subject, or to be
subject, thereto.
4.4 Provisions of Collateral Security. The provisions of
Section 4.4.1 through 4.4.6, inclusive, shall be applicable only if
any of the Lenders shall exercise its rights to require security
pursuant to Section 4.1.
4.4.1 Assigned Eligible Equipment Information. Xxxxxxx shall
furnish at monthly intervals, such information concerning Assigned
Eligible Equipment and Leases assigned as security hereunder as any
Lender may request and will show with respect to the period for which
such report is made all net proceeds received from the sale,
destruction, commandeering, conversion, loss of or damage to,
prevention or use of, attachment of, or insurance on or with respect
to Assigned Eligible Equipment or other property and assets
encumbered hereunder and a schedule of all changes of principal
garaging of Eligible Equipment made during the period.
4.4.2 Eligible Equipment Insurance. The insurance
arrangements required by Section 7.5 shall be for the benefit of
Xxxxxxx and Lenders as their interests may appear and all insurance
policies shall provide for a ten (10) day written minimum
cancellation notice to Xxxxxxx and Lenders; and in the event of any
such cancellation and failure on the part of Xxxxxxx to provide
adequate insurance arrangements satisfactory to Lenders, Lenders may,
at their option, provide such insurance and charge the cost thereof
to Xxxxxxx as security administration charges hereunder.
4.4.3 Procedural Changes. If, in the opinion of the Lenders
or its counsel, changes or modifications in the procedures governing
titling, registration, mortgaging of, the recording of Mortgages on,
or other action with respect to Assigned Eligible Equipment are
necessary or desirable to better perfect or otherwise protect the
Lenders' security interest, Xxxxxxx, upon request of such Lenders
will exert its best efforts to cause such changes or modifications to
be made or adopted.
4.4.4 Releases. If Xxxxxxx is not in default under Section
10.1 hereof, the Lenders shall release from the lien of any Mortgage
or other security instrument held by them any Assigned Eligible
Equipment or other encumbered property and assets which Xxxxxxx
wishes to sell upon payment to the Lenders of the Net Book Value of
such Eligible Equipment or book value of such other property. If and
when this Agreement has been terminated and all indebtedness and
liabilities of Xxxxxxx hereunder shall have been paid in full, the
Lenders shall discharge all Mortgages and release to Xxxxxxx all
other security, if any, then held by it.
4.4.5 Termination of Security Interest. When and only when
(i) Xxxxxxx shall have paid in full the principal of all outstanding
Loans hereunder, interest thereon and all other amounts to be paid by
Xxxxxxx hereunder, pursuant hereto or to any transaction contemplated
hereby, and all other obligations of Xxxxxxx secured by the security
interest provided for in Section 4.1 shall have been fully performed,
and (ii) the obligation of the Lenders to make Loans hereunder shall
have terminated pursuant to Section 11.1, then the security interest
of the Lenders provided for in Section 4 hereof shall terminate, and
at the request and expense of Xxxxxxx, the Lenders will execute and
deliver to Xxxxxxx such written evidence thereof, including
termination statements, and take such other action as Xxxxxxx may
reasonably request.
4.4.6 Waivers of Demands, Notices, Etc. Xxxxxxx waives any
requirement of law for the making or giving of any demand or notice
of any default hereunder or under any Lease and, in general, for all
other notices and formalities relating to this Agreement or any
security therefor, other than notices specifically required hereby.
Xxxxxxx consents to, and waives notice of, the granting by the
Lenders or the Agent for the Lenders of indulgences or extensions of
time of payment under any Lease, the taking or releasing of any
security for the obligations of any lessee under any Lease, the
addition or release of persons primarily or secondarily liable on or
with respect to liabilities of any lessee under any Lease, the
acceptance of partial payments under any Lease or the settlement,
compromising or compounding of any thereof, all in such manner and at
such time as the Lenders or the Agent for the Lenders may deem
advisable. The Lenders and the Agent for the Lenders shall not be
required to prosecute collection or other remedies against any person
primarily or secondarily liable on or with respect to the obligations
of any lessee under any Lease assigned to the Lenders or the Agent
for the Lenders pursuant hereto, or to enforce or resort to any
security, liens, collateral or other remedies appertaining to
obligations of any such person before calling Xxxxxxx for payment or
otherwise, nor shall any act or omission of any Lender or the Agent
for the Lenders in any way impair or affect any of the indebtedness
of liabilities of Xxxxxxx to any Lender hereunder or the rights of
the Lenders and the Agent for the Lenders in any security.
4.5 Lenders' Rights in Deposits and Other Property; Set-Off.
Upon the occurrence of any Event of Default the Lenders, or any of
them, may without notice or further action (i) set-off against and
apply and appropriate to the liabilities of Xxxxxxx hereunder,
whether or not due, any amounts of money and all property which may
now or at any time hereafter be held by such Lender or owing or due
by such Lender in any capacity, to Xxxxxxx, including, but not
limited to any balance or share belonging to Xxxxxxx of any deposit
or other account with such Lender or sums or property in transit to
such Lender or securities or other properties of Xxxxxxx which at any
time are in the possession of such Lender ("Liened Property"), and
the Lenders, and each of them, shall be deemed to have exercised such
right and to have set-off, applied and appropriated any such Liened
Property immediately upon any Event of Default occurring,
irrespective of when any record of the same may thereafter be entered
on the books of any such Lender, and (ii) the Lenders, and each of
them, shall at all times have, with respect to the Liened Property
all the rights of a secured party under the Uniform Commercial Code
and other applicable law.
4.6 Pro Rata Payments. If, after an Event of Default shall have
occurred and while it shall be continuing, any Lender receives any
payment in respect of the obligations of Xxxxxxx hereunder (whether
by set-off, exercise of rights under any security interest, or
otherwise) in an amount which is greater than the proportionate share
(determined on the basis of the respective outstanding balances of
principal of Loans made by the Lenders) of all payments made to the
Lenders at such time, the Lender so receiving such greater
proportionate payment (the "Receiving Lender") will purchase a
portion of the obligations of Xxxxxxx hereunder held by each other
Lender so that after such purchase there shall be held by each Lender
an unpaid balance of principal of such obligations bearing the same
proportion to the outstanding balance of principal of the Combined
Debt as existed immediately prior to the Receiving Lender's receipt
of such payment.
4.7 Administrative Expenses. If any Lender shall exercise its
rights to acquire security pursuant to Section 4.1, Xxxxxxx will pay
to each of the Lenders and the Agent for the Lenders such reasonable
fees, charges and expenses, as any such Lender or the Agent for the
Lenders may request as compensation for the administration of
collateral pursuant hereto; provided only that such fees and charges
shall be consistent with fees and charges imposed by such Lender or
the Agent for the Lenders for similar services provided by it in
other transactions in the ordinary course of its business.
5. APPOINTMENT OF FIRST UNION AS ATTORNEY.
5.1 Xxxxxxx hereby irrevocably appoints First Union its true and
lawful attorney with power of substitution, for it and in its name,
or in the name of First Union or otherwise, for the use and benefit
of Lenders, but at the cost and expense of Xxxxxxx: (a) to do all
acts and things which First Union may deem necessary to perfect and
continue perfected the security interest which Xxxxxxx hereby agrees
to grant to the Lenders pursuant to Article 4, including the
execution on behalf of Xxxxxxx of Mortgages, security agreements,
instruments of assignment or transfer, financing statements and
documents for the notation of encumbrances on certificates of title
for Eligible Equipment; (b) to commence and prosecute in the name of
First Union as agent for the Lenders or in the name of Xxxxxxx any
suits, actions or proceedings at law or in equity, in any court of
competent jurisdiction, but only to enforce any of the rights granted
or agreed to be granted to the Lenders pursuant to Article 4; (c)
collect any sums assigned to the Lenders or to enforce any rights in
respect thereof; and (d) generally to sell, assign, transfer, pledge,
make any agreement with respect to or otherwise deal with any claims,
all Eligible Equipment subject to any Mortgage, grant or security
interest as fully and completely as though First Union were the
absolute owner thereof for all purposes, but only to enforce any of
the rights granted or agreed to be granted to the Lenders pursuant to
Article 4; and for the purpose of realizing its rights therein, First
Union may, in the name of Xxxxxxx, endorse and deliver checks and
other instruments for the payment of money, and endorse and deliver
certificates of title and any and all instruments of title for any
Eligible Equipment owned by Xxxxxxx. The powers conferred on First
Union by this Section are solely to protect the interests of the
Lenders and shall not impose duties upon First Union to exercise any
such powers.
6. REPRESENTATIONS AND WARRANTIES OF XXXXXXX.
6.1 Xxxxxxx represents and warrants that: (a) Valid
Organization, Good Standing and Qualifications. Xxxxxxx is duly and
validly organized and an existing corporation in good standing under
the laws of Delaware, the state of its incorporation. Xxxxxxx is
duly licensed or qualified and in good standing as a foreign
corporation in each jurisdiction where the ownership or leasing of
property or the nature of the business transacted by it makes such
qualification necessary. Xxxxxxx is entitled to own its properties
and assets, and to carry on its business, all as, and in the places
where, such properties and assets are now owned or operated or such
business is now conducted or presently proposed to be conducted.
Xxxxxxx has made payment of all franchise and similar taxes in the
jurisdictions of its incorporation, and in all of the jurisdictions
in which it is qualified as a foreign corporation, insofar as such
taxes are due and payable at the date of this Agreement, except for
any such taxes the validity of which is being contested in good faith
and for which proper reserves have been set aside on the books of
Xxxxxxx.
(b) Xxxxxxx has all necessary corporate power and authority
to make and carry out this Agreement, to make the borrowings provided
for herein, to take all action contemplated hereby or required
hereunder, to execute and deliver this Agreement and any other
documents delivered or to be delivered in connection herewith and to
perform its obligations hereunder; and all such action has been duly
authorized by all necessary corporate proceedings on its part.
6.2 Business of Xxxxxxx. Xxxxxxx is engaged in the businesses
of leasing transportation equipment and providing logistics services.
6.3 No Pending Material Litigation or Proceedings. Except as
set forth in Exhibit B, there are no actions, suits or proceedings
pending or, to the knowledge and belief of Xxxxxxx, threatened
against or affecting Xxxxxxx or any of its Subsidiaries at law or in
equity or before or by any federal, state, municipal or other
governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, which involve the possibility
of any judgment or liability, not fully covered by insurance or by
reserves maintained pursuant to a self-insurance program, in excess
of $500,000 per occurrence, or which may materially or adversely
affect the business, properties or assets or the condition, financial
or otherwise, of Xxxxxxx or any of its Subsidiaries or the right of
any of them to carry on its business as now conducted. None of
Xxxxxxx or any of its Subsidiaries is, to the knowledge and belief of
Xxxxxxx, (i) in default with respect to any order, writ, injunction
or decree of any court or (ii) in default in any material respect
under any order, regulation or demand of any federal, state,
municipal or other government or agency thereof, default under which
might have consequences which would materially and adversely affect
the business, properties or assets or the condition, financial or
otherwise, of Xxxxxxx or any of its Subsidiaries.
6.4 No Adverse Contracts or Restrictions. Xxxxxxx is not a
party to, or bound by, any contract or agreement or instrument, or
subject to any charter or other corporate restriction, materially and
adversely affecting its business, property, assets, operations or
conditions, financial or otherwise.
6.5 No Legal Restrictions on Performance. The execution and
delivery of this Agreement, the consummation of the transactions
contemplated hereby, the fulfillment of the terms hereof, and the
compliance with the respective terms, conditions and provisions of
this Agreement by Xxxxxxx will not conflict with or result in a
breach of, or constitute a default (or might, upon the passage of
time or the giving of notice or both, constitute a default) under,
any of the terms, conditions or provisions of any corporate
restriction or of any indenture, mortgage, deed of trust, pledge,
Loan or credit agreement, corporate charter, by-laws or any other
agreement or instrument to which Xxxxxxx is a party or by which it or
its properties may be bound or affected, or any judgment or order,
writ, injunction, decree or demand of any court or federal, state,
municipal or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, or result in
the creation or imposition of any lien, charge or encumbrance of any
nature whatsoever upon any of the property or assets of Xxxxxxx under
the terms or provisions of any such agreement or instrument.
6.6 No Default under Other Obligations. Xxxxxxx is not in
violation of any term of its charter or by-laws or in default in the
performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any indenture or other agreement
creating, evidencing or securing Indebtedness of Xxxxxxx or pursuant
to which any such Indebtedness is issued, or other agreement or
instrument to which Xxxxxxx is a party or by which it or its
properties may be bound or affected.
6.7 Governmental Consents. No consent, approval or
authorization of or designation, declaration or filing with any
governmental authority on the part of Xxxxxxx, is required in
connection with the execution, delivery or performance of this
Agreement by it or the consummation by it of the transactions
contemplated hereby.
6.8 Tax Status. Xxxxxxx has filed all United States income tax
returns and all state and municipal tax returns which are required to
be filed by it, and has paid, or made provision for the payment of,
all taxes which have or may have become due pursuant to said returns
or pursuant to any assessment received by Xxxxxxx, except such taxes,
if any, as are being contested in good faith and as to which adequate
reserves have been provided.
6.9 ERISA. Each pension, profit sharing and other employee
benefit plan maintained for the benefit of Xxxxxxx or for any
Subsidiary is in compliance with the Employee Retirement Income
Security Act ("ERISA") and all applicable rules and regulations
adopted by regulatory authorities pursuant thereto, and all reports
required to be filed by ERISA and such rules and regulations have
been filed.
6.10 Financial Condition.
The audited consolidated financial statements of Xxxxxxx
dated September 30, 1997, and the related consolidated statements of
operations, shareholders' equity and cash flows for the fiscal year
ended on that date:
(a) Were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise
expressly noted therein, subject to ordinary, good faith year-end
audit adjustments;
(b) Fairly present the financial condition of Xxxxxxx as of
the date thereof and results of operations for the period covered
thereby, and since September 30, 1997, there has been no material
adverse change in the business, performance, operations or condition
(financial or otherwise) of Xxxxxxx.
6.11 Environmental Matters. Xxxxxxx conducts in the
ordinary course of business a review of the effect of existing
environmental laws and existing environmental claims on its business,
operations and properties, and as a result thereof Xxxxxxx has
reasonably concluded, such Environmental Laws and environmental
claims could not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on its financial
condition.
6.12 Title to Properties. Xxxxxxx has good record and
marketable title in fee simple to, or valid leasehold interests in,
all real property necessary or used in the ordinary conduct of its
businesses. As of the Closing Date, the property of Xxxxxxx that is
subject to Liens does not exceed $1,000,000 in the aggregate.
6.13 Regulation U. Neither Xxxxxxx nor any Subsidiary of
Xxxxxxx is engaged in the business of extending credit for the
purpose of purchasing or carrying margin stock, within the meaning of
Regulation U issued by the Board of Governors of the Federal Reserve
System ("Margin Stock"), and no proceeds of the Loans will be used to
purchase or carry any margin stock or to extend credit to others for
the purpose of purchasing or carrying any margin stock.
6.14 Investment Company, Public Utility Holding Company.
Neither Xxxxxxx nor any Subsidiary of Xxxxxxx (i) is subject to
regulation under the provisions of the Public Utility Holding Company
Act of 1935, as amended, or (ii) is an "investment company" or a
company "controlled" by an "investment company" within the meaning of
the Investment Company Act of 1940, as amended.
6.15 Accurate and Complete Disclosure. Xxxxxxx has
disclosed to the Lenders in writing every fact which materially and
adversely affects, or which so far as Xxxxxxx can reasonably foresee
would materially and adversely affect, the business, operations or
financial condition of Xxxxxxx or its Subsidiaries or the ability of
Xxxxxxx to perform its obligations under this Agreement.
6.16 Year 2000 Program. Xxxxxxx will use its best efforts
to monitor the potential impact of the Year 2000 problem and, if any
problem is determined to exist, to develop and implement a
comprehensive detailed program to address on a timely basis such
problem.
7. AFFIRMATIVE COVENANTS OF XXXXXXX. Xxxxxxx covenants and agrees
that until the obligation of Lenders to make Loans pursuant hereto
shall have terminated and thereafter so long as any Loan made
pursuant hereto shall be outstanding or any amount shall be payable
hereunder by Xxxxxxx, except as Lenders may otherwise consent or
agree in writing:
7.1 Payment of Principal and Interest. Xxxxxxx will duly and
punctually pay all amounts of principal of and interest on Loans made
hereunder and all other amounts payable by it hereunder when such
payments are due in accordance with the terms hereof.
7.2 Payment of Taxes. Xxxxxxx will promptly pay and discharge
or cause to be paid and discharged all taxes, assessments,
governmental charges or levies imposed upon it, or upon its income
and profits, or upon any property belonging to it, or upon any part
thereof, before the same shall become in default, as well as all
claims for labor, materials and supplies which, if unpaid, might
become a lien or charge upon such properties or any part thereof;
provided, however, that Xxxxxxx shall not be required to pay and
discharge any such tax, assessment, charge, levy or claim so long as
the validity thereof shall be contested in good faith by appropriate
proceedings promptly initiated and diligently conducted by Xxxxxxx,
no foreclosure, sale or similar proceeding shall have been commenced
in respect thereof (or such proceeding shall have been stayed pending
the disposition of such contest of validity), and Xxxxxxx shall have
set aside on its books adequate reserves with respect thereto.
7.3 Corporate Existence. Xxxxxxx will do or cause to be done
all things necessary to preserve and keep in full force and effect
its corporate existence, rights and franchises and comply with the
requirements of all applicable laws and all lawful rules, regulations
and orders of regulatory agencies and authorities having jurisdiction
over it.
7.4 Maintenance of Properties. Xxxxxxx will at all times
maintain, preserve, protect and keep or cause to be maintained,
preserved, protected and kept, its property and every part thereof
used or useful in the conduct of its business (including without
limitation the Eligible Equipment) in good repair, working order and
condition, and from time to time make, or cause to be made, all
necessary and proper repairs, renewals, replacements, betterments and
improvements thereto, so that the business carried on in connection
therewith may be properly and advantageously conducted at all times.
7.5 Insurance. Xxxxxxx will keep adequately insured by
financially sound and reputable insurers, all property of a character
usually insured by corporations engaged in the same or a similar
business similarly situated against loss or damage of the kinds
customarily insured against by such corporation, and carry such
liability and other insurance as is usually carried by corporations
engaged in a similar business. Xxxxxxx will maintain or cause to be
maintained the insurance in respect of each unit of Eligible
Equipment required by the related Lease, and will deliver to the
Lenders such evidence thereof as they may from time to time request;
provided, however, that (i) the self-insurance program of Xxxxxxx,
shall, to the extent of the coverage of such program and so long as
it shall be maintained, be an adequate substitute for such insurance
and (ii) Xxxxxxx may enter into other self-insurance programs if any
such program is first approved by the Lenders in writing.
7.6 Accounts and Financial Statements. Xxxxxxx will keep proper
books of record and account in which full, true and correct entries
will be made of all its dealings, business and affairs in accordance
with generally accepted accounting principles, and deliver to Lenders
as soon as available, and in any event:
(a) within sixty (60) days after the end of each of the
first three quarterly accounting periods in each fiscal year of
Xxxxxxx, (i) the consolidating and the consolidated income and
retained earnings statements of Xxxxxxx and its Subsidiaries, for
such quarterly period and for the expired portion of the fiscal year
ending with the end of such period, setting forth in comparative form
the corresponding figures for the corresponding period of the
previous fiscal year, and (ii) the consolidating and consolidated
balance sheets of Xxxxxxx and its Subsidiaries as at the end of such
quarterly period, setting forth in comparative form the corresponding
figures as at the end of the corresponding period of the previous
fiscal year, (iii) consolidating and consolidated statement of cash
flows for such quarterly period and for the expired portion of the
fiscal year ending with the end of such period, setting forth in
comparative form the corresponding figures for the corresponding
period of the previous fiscal year, all in reasonable detail, subject
to audited year-end adjustments, and certified by a principal
financial officer of Xxxxxxx to have been prepared in accordance with
generally accepted accounting principles consistently maintained by
Xxxxxxx and its Subsidiaries since the beginning of the fiscal year
immediately preceding the period covered by each quarterly statement
except for inconsistencies explained in such certificate.
(b) within ninety (90) days after the end of each fiscal
year of Xxxxxxx (i) the consolidating and the consolidated income and
retained earnings statements of Xxxxxxx and its Subsidiaries for such
year, setting forth in comparative form the corresponding figures for
the previous fiscal year and (ii) the consolidating and the
consolidated balance sheets of Xxxxxxx and its Subsidiaries as at the
end of such fiscal year, setting forth in comparative form the
corresponding figures as at the end of the previous fiscal year,
(iii) consolidating and consolidated statement of cash flows of
Xxxxxxx and its Subsidiaries for such year, setting forth in
comparative form the corresponding figures for the previous fiscal
year all such statements referred to in subsections (i), (ii) and
(iii) to be in reasonable detail, including all supporting schedules
and comments, and in the case of all such consolidated statements,
certified by independent public accountants of recognized standing
satisfactory to the Lenders, to have been prepared in accordance with
generally accepted accounting principles consistently maintained by
Xxxxxxx and its Subsidiaries since the beginning of the fiscal year
preceding that for which such statement is furnished and such
independent public accountants shall also certify that they have
reviewed the terms of this Agreement and that in making the
examinations necessary to their certification they have reviewed the
accounts and condition of Xxxxxxx and its Subsidiaries during the
accounting period covered by their certificate and that such review
did not disclose the existence of any condition or event which
constitutes a Default or would, upon giving notice or the passage of
time, or both, constitute such a Default (or if such conditions or
events existed, describing them);
(c) within ninety (90) days after the end of each fiscal
year of Xxxxxxx and within 60 days after the end of each of the first
three quarters of each fiscal year (and in any event not later than
simultaneously with the delivery of the financial statements required
pursuant to Sections 7.6(a) and (b) hereof), a certificate dated as
of the end of such fiscal year or quarter, signed on behalf of
Xxxxxxx by its chief financial officer, (i) stating that as of the
date thereof no Event of Default or Default has occurred and is
continuing or exists, specifying in detail the nature and period of
existence thereof, if any, and any action with respect thereto taken
or contemplated to be taken by Xxxxxxx; (ii) stating in reasonable
detail the information and calculations necessary to establish
compliance with the provisions of Section 7.15, 7.16, 7.17, and 8.1
hereof; and (iii) stating that the signer has reviewed this Agreement
and that such certificate is based on an examination made by or under
the supervision of the signer sufficient to assure that such
certificate is accurate.
(d) all such other data and information in respect of the
conditions, operations and affairs of Xxxxxxx and its Subsidiaries as
any Lender may reasonably request from time to time. Such
information shall also be furnished to the other Lenders.
7.7 Default Under Other Indebtedness. If any Indebtedness of
Xxxxxxx is declared or becomes due and payable before its expressed
maturity by reason of default, or the holder of any such Indebtedness
shall have the right (or upon the giving of notice, shall have the
right) to declare such Indebtedness to be so due and payable by
reason of default, Xxxxxxx will immediately give the Lenders written
notice of such declaration, acceleration or right of declaration.
7.8 Inspection. Any Lender or such persons as it may designate,
may visit and inspect any of the properties of Xxxxxxx, examine
(either by its employees or by independent accountants employed by
it) the books of account and other records, including without
limitation, title certificates and Lease(s) of Xxxxxxx and discuss
the affairs, finances and accounts of Xxxxxxx with its officers and
with its independent accountants, all at such reasonable times and as
often as such Lender may desire.
7.9 Liens. Except for the security interests which may be
granted to the Lenders hereby or pursuant hereto, Xxxxxxx will keep
the Eligible Equipment reflected in the latest Borrowing Base
Certificate delivered to the Lenders and all Leases thereof free and
clear of all liens, security interests and encumbrances.
7.10 Borrowing Base Certificate. Xxxxxxx will deliver to
each Lender, on or before the 25th day of each calendar quarter, a
Borrowing Base Certificate in substantially the form of Exhibit B
attached hereto setting forth the information as to its Borrowing
Base and other matters called for thereby as of the last day of the
preceding calendar quarter accompanied by a schedule describing in
reasonable detail each item of Eligible Equipment. Each Borrowing
Base Certificate shall be accompanied by (i) a schedule, describing
in such detail, as any Lender may reasonable require, each item of
Eligible Equipment reflected in the Borrowing Base Certificate, (ii)
a schedule describing in reasonable detail, each item of Eligible
Equipment described in a previously delivered Borrowing Base
Certificate since disposed of by Xxxxxxx; (iii) a schedule describing
in reasonable detail (x) each existing Lease of Eligible Equipment
not described in a previously delivered schedule to the Lenders and
(y) each previously described Lease which has since terminated and
which termination has not been previously reported to any Lender.
7.11 Performance of Lease Obligations; Collections. Xxxxxxx
will perform, or cause to be performed, all the obligations to be
performed by the lessor under the terms of all leases which may be
assigned to the Lenders pursuant hereto (or intended so to be).
7.12 Certification by Independent Public Accountants. On or
before December 31 of each year, Xxxxxxx will deliver to the Lenders
the certificate of independent public accountants of recognized
standing, selected by Xxxxxxx and satisfactory to the Lenders to the
effect (a) that such accountants have, as of September 30 of such
year, (i) physically examined title certificates (or copies of filed
financing statements with respect to non title states) for Eligible
Equipment on a statistical sampling basis, identifying them in
reasonable detail including a description of the Motor Vehicle
described thereon, the registered owner thereof and all liens, if
any, noted thereon, and setting forth in reasonable detail such
information as the books and records of Xxxxxxx may disclose
(including any reports to such accountants by Xxxxxxx' employees) as
to the whereabouts of all such title certificates of Xxxxxxx and (ii)
compared Xxxxxxx' detailed vehicle listing of Motor Vehicles which
are Eligible Equipment with summaries of revenue by vehicle on a test
basis and (b) that the Borrowing Base Certificate as of September 30
of such year, delivered by Xxxxxxx to the Lenders, presents fairly
the status of the Net Book Value of Eligible Equipment reflected
thereon as of such date as evidenced by the books and records of
Xxxxxxx.
7.13 Certificate of Xxxxxxx as to Title Certificates. On or
before May 15 of each year, Xxxxxxx will deliver to the Lenders its
certificate, signed by its President or any Vice President,
identifying all title certificates for Eligible Equipment on March 31
of such year and the whereabouts of all such title certificates which
should, pursuant hereto, have been in the possession of Xxxxxxx on
such date but were not so held, all in the same detail as is required
for the certificate referred to in clause (a) of Section 7.12.
7.14 Commitment Fee. On or before the last business day of
each calendar quarter, Xxxxxxx will pay to each Lender for Facility
A, a commitment fee in the amount of 12.5 basis points (1/8 of 1%)
per annum of the excess, if any, of such Lender's Facility A
Commitment Amount over the daily average aggregate principal amount
of Facility A Prime Rate Loans of each such Lender outstanding
hereunder.
7.15 Maintenance of Working Capital. Xxxxxxx will at all
times maintain Working Capital in an amount greater than $7,000,000.
Together with the financial statements which Xxxxxxx is required to
deliver to the Lenders pursuant to Section 7.6, Xxxxxxx shall deliver
to the Lenders a certificate, certified to be correct by the
principal financial officer of Xxxxxxx, which shall set forth the
amount of Working Capital required to be maintained by this Section,
the calculations upon which such determination is based and the
amount of Working Capital actually maintained by Xxxxxxx as of the
date of the financial statements upon which such determination is
based.
7.16 Maintenance of Net Worth. Xxxxxxx will at all times
maintain a Net Worth greater than the sum of $200,000,000 plus 50%
cumulative quarterly positive net income subsequent to September 30,
1997.
7.17 Current Ratio. Xxxxxxx will at all times maintain
Current Assets of no less than 150% of Current Liabilities.
7.18 Further Assurance. Xxxxxxx will execute and deliver
all such instruments and take all such other action as the Lenders
may reasonably require to effectuate the purposes of this Agreement
and to secure the rights and remedies conferred upon the Lenders
hereunder.
8. NEGATIVE COVENANTS OF XXXXXXX. Xxxxxxx covenants and agrees
that until the obligation of Lenders to make Loans pursuant hereto
shall have terminated pursuant to Section 11.1 and thereafter so long
as any Loan made pursuant hereto shall be outstanding or any amount
shall be payable hereunder by Xxxxxxx, except as the Lenders may
otherwise consent or agree in writing:
8.1 Indebtedness to Net Worth Ratio. Xxxxxxx will not have
outstanding at any time Senior Indebtedness which in the aggregate
exceeds 375% of Net Worth of Xxxxxxx. For purposes of this Section
8.1, Net Worth, as defined in Section 16.29, shall include 50% of
Xxxxxxx' Deferred Income Taxes.
8.2 Disposition of Properties or Assets. Xxxxxxx will not sell,
lease, transfer or otherwise dispose of all or any substantial part
of its property or assets otherwise than in the ordinary course of
business, to any Person.
8.3 Merger, Consolidation. Xxxxxxx will not merge into or,
except as provided in Section 8.4, consolidate with any Corporation.
8.4 Business Acquisitions. Xxxxxxx will not acquire any of the
voting stock or any of the substantial assets or business of any
Person, or permit any Corporation to merge into or consolidate with
Xxxxxxx, if the consideration payable by Xxxxxxx therefor or in
connection therewith exceeds or may exceed an amount equal to fifteen
percent (15%) of the Net Worth of Xxxxxxx as set forth in the latest
report furnished pursuant to Section 7.6 herein. If such
consideration shall be payable in securities or property other than
cash, the value thereof shall be determined in any reasonable manner
approved by the Lenders; provided that if such consideration shall be
payable in securities of an issuer of a class which is listed on a
national securities exchange, the value thereof, for the purpose of
this Agreement, will be the last sale price thereof on the principal
securities exchange on which such securities are listed on the day as
of which the amount of such consideration is fixed, or if no such
sale takes place on such day, the closing bid price therefor on such
exchange. If the amount of such consideration is not fixed on or
before the time for the first payment of any thereof, then, for the
purposes of this Section 8.4 such amount will be deemed to be the
maximum amount payable pursuant to the agreement therefor and shall
be deemed to have been "fixed" as of the date of such agreement.
8.5 Business of Xxxxxxx. Xxxxxxx will not engage directly or
indirectly through any Subsidiary in any business other than set
forth in Section 6.2.
8.6 Limitation on Payments to Stockholder. Xxxxxxx will not,
directly or indirectly, after the date hereof, make any distribution,
advance, investment or other payment to any Person who is, either
directly or through any Subsidiary thereof, a stockholder of Xxxxxxx,
or to any Subsidiary of any such Person (other than Subsidiaries of
Xxxxxxx) including any payment by way of any Loan, acquisition of any
security, dividend, redemption or other acquisition of shares of its
capital stock, consulting or management fees, or otherwise which
would, in the aggregate, exceed the sum of the amount of advances by
such Person to Xxxxxxx made after September 30, 1976, plus interest
thereon at a rate not in excess of the rate provided for in the first
sentence of Section 1.4. However, the foregoing will not preclude
the declaration and payment of any dividend or distribution on the
capital stock of Xxxxxxx, provided that such dividend or distribution
will not cause Xxxxxxx to be in non-compliance with any provision of
Article Seven or Article Eight of this Agreement immediately after
such distribution.
8.7 Leases to Affiliates. Xxxxxxx will not, directly or
indirectly, lease to Affiliates Motor Vehicles having a Net Book
Value in the aggregate of more than five percent (5%) of the Net Book
Value of all Motor Vehicles owned by Xxxxxxx.
8.8 Use of Proceeds. Xxxxxxx will not use, or permit the use
of, the proceeds of any Loan hereunder for the purpose of buying or
carrying any "margin stock" as such term is used in Regulation U of
the Board of Governors of the Federal Reserve System.
8.9 Double Negative Pledge. Xxxxxxx will not, directly or
indirectly, incur or assume any obligations to any third party which
would prohibit or restrict the ability of Xxxxxxx to grant any lien
in favor of the Lenders.
8.10 Restriction on Liens. Xxxxxxx shall not, create,
incur, assume or suffer to exist, or permit any of its Subsidiaries
to create, incur, assume or suffer to exist, any lien on its
respective property, revenues or assets, whether now owned or
hereafter acquired except:
(a) liens upon or in any property acquired by Xxxxxxx or
any of its Subsidiaries in the ordinary course of business to secure
the purchase price of such property or to secure any obligation
incurred solely for the purpose of financing the acquisition of such
property;
(b) easements, right-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in
the aggregate, are not substantial in amount, and which do not in any
case materially detract from the value of the property subject
thereto or interfere with the conduct of the businesses of Xxxxxxx
and its Subsidiaries.
9. CONDITIONS OF CLOSING.
9.1 First Loan. The obligation of the Lenders to make the first
Loan requested by Xxxxxxx hereunder shall be subject to the
following:
(a) With respect to Facility A Loans, the Lenders shall
have received counterparts of this Agreement, each duly executed by
Xxxxxxx and with respect to Facility B Loans, if any, each Lender
shall have received such documentation relating thereto as each such
Lender may, in its discretion, require in connection therewith.
(b) Resolutions. The Board of Directors of Xxxxxxx shall
have adopted appropriate resolutions authorizing the execution and
delivery of this Agreement and the taking of all actions called for
herein and certified copies of same shall have been furnished to the
Lenders.
(c) Opinion Letter. Counsel for Xxxxxxx shall have
furnished opinions in form and substance satisfactory to the Lenders
covering the following matters:
(i) Xxxxxxx is duly incorporated and in good standing
and validly existing under the laws of the State of Delaware and has
corporate power to carry on its business as described in Section 6.2
herein.
(ii) This Agreement has been duly authorized,
executed and delivered by Xxxxxxx and is a valid instrument legally
binding upon Xxxxxxx and enforceable in accordance with its terms.
(iii) The execution and performance of this
Agreement does not violate the articles of incorporation or by-laws
of Xxxxxxx or, to the knowledge of counsel, any agreement to which
Xxxxxxx is a party.
(iv) The representations and warranties contained
in Sections 6.1, 6.3, 6.4, 6.5, 6.6, 6.7, 6.8 and 6.9 are true and
correct in all material respects. In this regard, Counsel may rely
upon the certificates of the President and Chief Financial Officer of
Xxxxxxx with respect to that portion of Section 6.1 dealing with
franchise and similar taxes and Section 6.8.
(d) Prior Loans. On the date of the execution of this
Agreement, the existing indebtedness of Xxxxxxx pursuant to the Bank
Credit Agreement dated as of April 1, 1995, as amended shall be
repaid in full from the proceeds of the credit available under this
Agreement.
9.2 First and Subsequent Loans. The obligation of the Lenders
to make any Facility A Loan requested by Xxxxxxx hereunder (including
the first such Loan) shall be subject to the fulfillment at or prior
to the Loan Date thereof of the following conditions:
(a) Representations Correct. All the representations and
warranties of Xxxxxxx set forth herein or made hereunder shall be
correct as of such Loan Date except for such changes therein as may
be satisfactory to Lenders (and the making by Xxxxxxx of a Loan
Request therefor shall be deemed a certificate by it to the foregoing
effect).
(b) No Default. No condition or event shall exist (before
or after giving effect to any such Loan Request) or have occurred
which constitutes an Event of Default or a Default, and the making by
Xxxxxxx of a Loan Request for such Loan shall be deemed a certificate
by it to the foregoing effect).
(c) Principal Place of Business. The principal place of
business of Xxxxxxx shall be located in the State of Delaware.
9.3 Facility B Loans. The Lenders shall have no obligation to
make any Facility B Loan notwithstanding the satisfaction of the
conditions set forth in Sections 9.1 and 9.2 hereof but may do so or
decline to do so in their sole individual discretion and may, in
agreeing to make any Facility B Loans, if at all, impose conditions
to such Loan or Loans in addition to those set forth in Sections 9.1
and 9.2.
10. DEFAULTS AND REMEDIES.
10.1 Events of Default. The occurrence of any one or more
of the following events shall constitute an Event of Default
hereunder:
(a) The failure of Xxxxxxx to pay any amount of principal
of any Loan as and when due or any interest on any Loan made
hereunder or any other amount payable pursuant hereto within 3 days
after such payment may be due, whether at the maturity thereof or by
reason of any requirement for the prepayment thereof, by acceleration
or otherwise;
(b) Xxxxxxx shall default in the performance, observance or
fulfillment of any covenant contained in Sections 7.1, 7.15, 7.16,
7.17 or Section 8.1 through 8.10 hereof, or Xxxxxxx shall default in
the performance, observance or fulfillment of any other covenant
contained herein and such later default shall continue for ten days
unremedied;
(c) The adjudication of Xxxxxxx or any of its Subsidiaries
as a bankrupt or insolvent, or the entry of an order appointing a
receiver or trustee for any such Person or any of its property or
approving a petition seeking reorganization or other similar relief
under the bankruptcy or other similar laws of the United States or
any state or any other competent jurisdiction, or the filing by any
such Person of a petition, answer or other document seeking or
consenting to any of the foregoing, or the filing by any such Person
of a petition to take advantage of any debtor's act, or the making by
any such Person of a general assignment for the benefit of creditors
or admitting in writing its inability to pay its debts as they
mature;
(d) The entry of a final judgment for the payment of money
against Xxxxxxx or any of its Subsidiaries, which, to the extent not
covered by insurance or cash reserved therefor pursuant to a self-
insurance program exceeds $500,000 in any one case or in the
aggregate for all such judgments and, within 60 days after such
entry, shall not have been discharged or execution thereof stayed
pending appeal or which shall not have been discharged within 60 days
after the expiration of any such stay;
(e) The issue of attachment, garnishment or any execution
process or the making of any levy against, any property of Xxxxxxx or
any of its Subsidiaries which, except in the case of such property
held by, or owed to such Person by, any of the Lenders, within 60
days (but prior to any sale or other disposition pursuant to such
process) thereafter shall not have been discharged;
(f) The occurrence of any event in respect of any
Indebtedness, having an aggregate principal amount (including undrawn
committed or available amounts and including amounts owing to all
creditors under any combined or syndicated credit arrangement) of
$10,000,000 or more which causes or permits the holder thereof to
cause such Indebtedness to become due prior to its stated maturity.
(g) Any representation or warranty by Xxxxxxx herein is
discovered to be untrue as of the date of this Agreement, or any
statement, certificate or data furnished by Xxxxxxx pursuant hereto
is discovered to be untrue as of the date as of which the facts
therein set forth are stated or certified (or deemed so to be);
(h) Xxxxxxx Truck Leasing Corp. shall cease to be the
owner, of record and beneficially, of at least 80% of the outstanding
shares of capital stock of Xxxxxxx, which shall represent at least
80% of the combined voting power of all classes of capital stock of
Xxxxxxx entitled to vote; and
(i) The voluntary termination of any pension, profit
sharing and other employee benefit plan maintained for the benefit of
Xxxxxxx or any Subsidiary and at such termination, there exists a
funding deficiency.
10.2 Effect of Event of Default. Upon the occurrence of any
Event of Default described in subsections (a), (b) or (d) through (i)
of Section 10.1, the Lenders shall be under no further obligation to
make Loans hereunder, and each Lender may declare the unpaid
principal balance of all Loans made by such Lender then outstanding
and interest accrued thereon and all other liabilities of Xxxxxxx to
such Lender hereunder to be forthwith due and payable, and the same
shall thereupon become and be immediately due and payable without
presentment, demand, protest or notice of any kind, all of which are
expressly waived. Upon the occurrence of an Event of Default
specified in subsection (c) of Section 10.1, the Lenders shall be
under no further obligation to make Loans hereunder and the unpaid
principal balance of all Loans outstanding hereunder and interest
accrued thereon, and all other liabilities of Xxxxxxx hereunder shall
be immediately due and payable, without presentment, demand, protest
or notice of any kind, all of which are hereby expressly waived.
10.3 Uniform Commercial Code. The Lenders and the Agent for
the Lenders shall have and may exercise the rights and remedies of a
secured party under the Pennsylvania Uniform Commercial Code.
10.4 Delay or Omission Not Waiver. No delay or omission on
the part of any of the Lenders to exercise any right upon the
occurrence of any Event of Default shall impair any such right or
shall be construed to be a waiver of any such Default or any
acquiescence therein. No waiver of any Default hereunder shall
affect any later Default or shall impair any of the Lenders' rights
hereunder. No single, partial or full exercise of any right by the
Lenders shall preclude further or other exercise thereof.
10.5 Remedies Cumulative. The remedies provided for herein
shall not be deemed exclusive, but shall be cumulative and shall be
in addition to all other remedies existing, in the Lenders' favor, at
law or in equity.
11. TERMINATION.
11.1 Termination by Xxxxxxx. Xxxxxxx may at any time
terminate all of the Lenders' obligations to make Loans pursuant to
this Agreement by giving notice thereof to the Lenders, stating the
date not less than ten (10) days thereafter when such termination
shall become effective. On the date specified for termination in
said notice, Xxxxxxx shall pay in full the Loans, together with
interest thereon through said date, and all other obligations
outstanding under this Agreement.
12. PAYMENTS OF CERTAIN EXPENSES BY XXXXXXX.
12.1 Expenses in Connection with Enforcement. Xxxxxxx will
pay all reasonable expenses of the Lenders, including attorneys fees,
incurred by Lenders in enforcing their rights and remedies hereunder
or under any Lease assigned to the Lenders pursuant hereto. In the
event that Lenders shall bring suit (or file any claim in any
bankruptcy, reorganization, insolvency or other proceeding) to
enforce any of their rights hereunder or under any such Lease and
shall be entitled to judgment (or other recovery) in such action (or
other proceeding) the Lenders may recover, in addition to all other
amounts payable hereunder or under such Lease, their respective
expenses in connection therewith, including attorneys fees, and the
amount of such expenses shall be included in such judgment (or other
form of award).
13. SURVIVAL OF COVENANTS: SUCCESSORS AND ASSIGNS.
13.1 Survival of Covenants, Etc. All covenants, agreements,
representations and warranties made by Xxxxxxx in this Agreement or
made in writing by or on behalf of Xxxxxxx in connection with any
transaction contemplated hereby shall survive the execution and
delivery of this Agreement, any investigation at any time made by the
Lenders or on its behalf and the making by the Lenders of the Loans
contemplated hereby, and shall continue in full force and effect
until all amounts payable by Xxxxxxx pursuant hereto have been paid
in full. All statements contained in any certificate, statement or
other document delivered by or on behalf of Xxxxxxx pursuant hereto
or in connection with the transactions contemplated hereby shall be
deemed representations and warranties by Xxxxxxx hereunder. All such
covenants, agreements, representations and warranties shall be
binding upon any successors and assigns of Xxxxxxx.
13.2 No Assignment by Xxxxxxx. Xxxxxxx may not assign any
of its rights hereunder without the consent of all Lenders.
14. MODIFICATION: WAIVER.
14.1 Modification of this Agreement. This Agreement may not
be changed orally, but only by an agreement in writing and signed by
the party against whom enforcement of any waiver, change,
modification or discharge is sought. This Agreement may be modified
or any provision hereunder may be waived by the agreement of the
Lenders and Xxxxxxx.
15. COMMUNICATIONS AND NOTICES.
15.1 Form, Addresses, Etc. All notices, requests and other
communications given or made in connection with this Agreement or any
transaction contemplated hereby shall be in writing and, unless
actual receipt is stated herein to be required, shall be deemed to
have been validly given if mailed, first class, postage prepaid,
addressed as follows, or delivered to the individual to whose
attention notices to any party are to be addressed, until some other
address (or individual for attention) shall have been designated by
notice given by a party to the others:
To Xxxxxxx:
Xxxxxxx Leasing Corp.
Xxx Xxxxxxx Xxxxx, X. X. Xxx 0000
Xxxxxxxxxx, XX 00000
Attention: President
To Lenders:
First Union National Bank
0000 Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxxx
BankBoston, N.A.
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxx Xxxxx
16. DEFINITIONS. The following words and phrases as used in
capitalized form in this Agreement and in any amendments hereof,
whether in the singular or plural, shall have the meanings indicated:
16.1 "Acquisition Cost" of any item of Eligible Equipment
means an amount equal to the sum of the factory delivered price,
delivery and handling charges and the cost of any original items
which may be added thereto (including but not limited to tires and
tubes), the cost of labor, materials, parts, accessories in respect
thereto, any excise tax on Eligible Equipment and any sales and use
taxes payable in respect of Xxxxxxx' purchase thereof, and other
similar charges and expenses required to make such Eligible Equipment
ready for use by and to complete delivery thereof to Xxxxxxx.
16.2 "Affiliate", as applied to any Person, means any other
Person which is not a Subsidiary of Xxxxxxx and which directly, or
indirectly through one or more intermediaries, is controlled by
Xxxxxxx Truck Leasing Corp.
16.3 "Aggregate Amortization" of any item of Eligible
Equipment means an amount equal to the product of the Monthly
Amortization Figure of such Eligible Equipment multiplied by the
number of months elapsed since the date of acquisition thereof by
Xxxxxxx.
16.4 "Amortized Value" of any item of Eligible Equipment at
any time means the
Acquisition Cost of such item less the Aggregate Amortization thereof
at such time.
16.5 "Amortization Period" means the period beginning on the
Revolving Expiration Date and ending on the Maturity Date.
16.6 "Assigned Eligible Equipment" is a Vehicle as to which
Xxxxxxx shall have executed and delivered a Mortgage in form and
substance as required by Section 4.
16.7 "Borrowing Base Amount" of Xxxxxxx at any time means an
amount equal to ninety percent (90%) of the aggregate Net Book Value
of all items of Eligible Equipment or Assigned Eligible Equipment, as
the case may be, owned by Xxxxxxx at such time, which are:
(A) Free and clear of all liens, security interests and
encumbrances, except for security interests which may be granted to
Lenders hereby or pursuant hereto;
(B) In reasonably good working order and condition or, if
not in such condition, are repairable to such state within a
reasonable period of time and Xxxxxxx has caused or arranged for such
repairs to be commenced and completed within such time; and
(C) Subject to Leases in Good Standing, except that
"Borrowing Base" may include the Net Book Value of Motor Vehicles in
Xxxxxxx' Commercial Rental Fleet which, in the aggregate, does not
exceed 40% of the aggregate Net Book Value of all Motor Vehicles
included in such "Borrowing Base;" provided that not more than
$5,000,000 aggregate Net Book Value of Eligible Equipment or Assigned
Eligible Equipment as the case may be, of the kind referred to in
clause (iii) of Section 16.15 shall be included in such Borrowing
Base at any time; and provided further that the lessee or other
obligor under any such Lease is not an Affiliate of Xxxxxxx.
16.8 "Combined Debt" means the maximum aggregate principal
amount of the Loans outstanding at any time hereunder.
16.9 "Commitment Amount" means $50,000,000 in the aggregate
and $25,000,000 with respect to each Lender as the same may be
reduced from time to time.
16.10 "Corporation" means a corporation, partnership, trust,
unincorporated organization, association, or joint stock company.
16.11 "Current Assets" of any Person means the current assets
properly appearing as such on a consolidated balance sheet of such
Person and its Subsidiaries prepared in accordance with generally
accepted accounting principles except that Current Assets shall not
include investments in securities other than direct obligations of,
or obligations guaranteed by, the United States of America and
securities which are readily marketable and, in any event, only at
the market value thereof.
16.12 "Current Liabilities" of any Person means the current
liabilities properly appearing as such on a consolidated balance
sheet of such Person and its Subsidiaries prepared in accordance with
generally accepted accounting principles except that in the case of
Xxxxxxx and its Subsidiaries, current liabilities shall not include
indebtedness of Xxxxxxx hereunder, Indebtedness of Xxxxxxx incurred
to a banking institution or to a vendor of equipment (or its finance
affiliate) to finance the acquisition cost of equipment acquired for
leasing and secured by such equipment.
16.13 "Default" means an event specified in Section 10.1
which, but for the lapse of time or the giving of notice or both
would be an Event of Default.
16.14 "Commercial Rental Fleet" means the Motor Vehicles
which are Equipment but are not subject to Leases in Good Standing.
6 16.15 "Eligible Equipment" means (i) Motor Vehicles, (ii)
other equipment used or useful in the transportation of property or
persons by land, sea or air (iii) other commercial and industrial
equipment provided the aggregate Net Book Value of such equipment
leased pursuant to one or more Leases with one lessee and its
affiliates shall not exceed $250,000; and (iv) such other commercial
and industrial equipment as may be agreed upon by Xxxxxxx and Lenders
from time to time; provided that the amortization period for any
equipment referred to in (iii) and (iv) above has been established by
or pursuant to Section 16.25.
16.16 "Event of Default" means each of the events specified
in Section 10.1.
16.17 "Indebtedness", as applied to a Person, means (a) all
items, except items of capital stock or of surplus, which in
accordance with generally accepted accounting principles would be
included in determining total liabilities as shown on the liability
side of a balance sheet of such Person as at the date as of which
Indebtedness is to be determined, excluding all current liabilities
of such Person (except current liabilities which represent
liabilities for borrowed funds), liabilities or reserves for deferred
income tax and reserves for liabilities pursuant to a self-insurance
program of such Person, (b) to the extent not included in the
foregoing, all indebtedness, obligations, and liabilities secured by
any mortgage, pledge, lien, conditional sale or other title retention
agreement or mortgage, pledge, lien, conditional sale or other title
retention agreement or other security interest to which any property
or asset owned or held by such Person is subject, whether or not the
indebtedness, obligations or liabilities secured thereby shall have
been assumed, (c) to the extent not included in the foregoing, all
indebtedness, obligations and liabilities of others which such Person
has directly or indirectly guaranteed, endorsed (other than for
collection or deposit in the ordinary course of business),
discounted, sold with recourse or for less than face value or agreed
(contingently or otherwise) to purchase or repurchase or otherwise
acquire or in respect of which such Person has agreed to supply or
advance funds (whether by way of Loan, stock purchase, capital
contribution or otherwise) or otherwise to become directly or
indirectly liable, and (d) to the extent not included in the
foregoing, lease obligations capitalized according to FASB 13.
16.18 "Lease" means a lease of Equipment, of which Xxxxxxx is
lessor and a responsible commercial user is lessee, pursuant to which
such lessee is obligated to make periodic rent payments to Xxxxxxx
during a fixed minimum term which payments, together with any lump
sum payments which such lessee is obligated to make within such term
on account of a purchase obligation or otherwise, will be (i) each in
an amount no less than the sum of the Monthly Amortization figures of
such Eligible Equipment during each period covered thereby plus an
interest factor at the rate of 7% per annum thereon for such period
and (ii) in the aggregate not less than the Acquisition Cost thereof
plus an interest factor of 7% per annum on the Amortized Value
thereof during such term.
16.19 "Lease in Good Standing" means a Lease under which no
default has occurred which remains uncured for a period of more than
90 days except for defaults or alleged defaults which are subject to
a bona fide dispute by the lessee.
16.20 "Lenders" means First Union National Bank and
BankBoston, N.A.
16.21 "LIBOR" is the rate for U. S. dollar deposits of 1
month as reported by Telerate page 3750 as of 11:00 a.m., London
time, on the second London business day before the relevant interest
period begins (or if not so reported, then as determined by Lender
from another bank or interbank quotation).
16.22 "Loan" means any loan by a Lender to Xxxxxxx under this
Agreement and "Loans" means all loans made by the Lenders or either
of them, as the context may require, under this Agreement.
16.23 "Loan Account" means the account maintained on the
books of each Lender pursuant to Section 1.5.
16.24 "Loan Date" means the date fixed for the making of any
Loan by notice from Xxxxxxx pursuant to Section 1.2.
16.25 "Loan Request" means a request by Xxxxxxx for a Loan
given pursuant to Section 1.3 in the form prescribed by Section 1.3.
16.26 "Maturity Date" means the date which is four (4) years
from the Revolving Expiration Date.
16.27 Monthly Amortization Figure for 90% of Eligible
Equipment means an amount equal to the Acquisition Cost thereof, less
salvage value applicable thereto, divided by the number of months of
the period in which the Acquisition Cost is to be amortized. Unless
otherwise agreed in writing by the Lenders with respect to any item
or type of Eligible Equipment, Acquisition Cost (without any
provision for salvage value) of the following types of Equipment
acquired new and unused by Xxxxxxx will be amortized in a period
which shall be the same period as used in computing depreciation in
its books of record and account provided that such period will not
exceed:
(i) 120 months (10 years) for tractors and straight trucks,
(ii)168 months (14 years) for trailers and bodies,
(iii)180 months (15 years) for standard specification
refrigerated trailers, and
(iv) 96 months (8 years) for pick-up trucks and panel
trucks.
The amortization period and salvage value for any other item of
Eligible Equipment will be such period and percentage of Acquisition
Cost as may be agreed upon in writing by Xxxxxxx and the Lenders from
time to time. If at any time improvements are made to any such item
of Eligible Equipment which are capitalized in accordance with
generally accepted accounting principles, the Monthly Amortization
Figure for such item of Eligible Equipment shall be increased by an
amount equal to the cost of such improvements divided by the number
of months remaining in the amortization period for such item at the
time such improvement is made.
16.28 "Mortgage" shall mean a chattel mortgage of or other
appropriate security agreement confirming the grant of a security
interest in one or more Vehicles to First Union, as collateral
security in accordance with Section 4.
16.29 "Motor Vehicle" means (i) a new and unused automobile,
van, truck, tractor, trailer, bus, or other similar unit, and all
related equipment and accessories, now or hereafter owned by Xxxxxxx
and (ii) a used automobile, van, truck, tractor, trailer, bus, or
other similar unit, and all related equipment and accessories
acquired by Xxxxxxx from one of its customers for the purpose of
leasing such item back to such customer pursuant to a Lease.
16.30 "Net Book Value" of Eligible Equipment or Assigned
Eligible Equipment, as the case may be, at any time means the
Acquisition Cost of such Eligible Equipment plus (i) the cost of
improvements thereto capitalizable in accordance with generally
accepted accounting principles less (ii) the Aggregate Amortization
thereof at such time.
16.31 "Net Worth" of any Person means the excess of all
assets over all liabilities properly appearing on a consolidated
balance sheet of such Person and its Subsidiaries prepared in
accordance with generally accepted accounting principles.
16.32 "Person" means an individual, a corporation or a
government or political subdivision or agency thereof.
16.33 "Prime Rate" means the rate per annum announced from
time to time by each Lender as its Prime Rate, and as to BankBoston,
its "Reference Rate", such rate to change automatically from time to
time effective as of the effective date of any changes in such Prime
Rate or Reference Rate as the case may be.
16.34 "Revolving Expiration Date" shall mean December 10,
1999 or such later date as may be agreed upon pursuant to Section
1.1(d).
16.35 "Senior Indebtedness", as applied to any Person, means
all Indebtedness of such Person other than Subordinated Indebtedness.
16.36 "Subordinated Indebtedness", as applied to any Person,
means any Promissory Note, debenture or other evidence of
indebtedness of such Person for money borrowed which contains
subordination provisions satisfactory in form and substance to the
Lenders (such satisfaction to be evidenced only by the Lenders
consent in writing to such terms).
16.37 "Subsidiary" means, with respect to any Person, (i) a
corporation incorporated within the United States of America or
Canada, (ii) the major portion of whose operations are carried on,
and the major portion of whose property is located, within the United
States of America or Canada, or both, and (iii) all of whose
outstanding shares of capital stock (other than directors' qualifying
shares) are owned by one or more of such Person and corporations
which meet the qualifications of clauses (i) and (ii) of this
sentence and all of whose outstanding shares of capital stock (other
than directors' qualifying shares) are owned by such Person, either
directly or through any corporation or series of corporations.
16.38 "Working Capital", as applied to any Person, means the
excess of Current Assets over Current Liabilities of such Person.
16.39 "Year 2000 Problem" shall mean the risk that computer
applications may be unable to recognize, and perform properly, date-
sensitive functions involving certain dates prior to and after
December 31, 1999.
16.40 "Agent for the Lenders" means the agent for the Lenders
appointed pursuant to Section 4.2.
16.41 "Facility A" means a 364-day revolving credit facility
converting to a four-year, fully amortizing term Loan as defined in
Section 1.
16.42 "Facility B" means uncommitted, as offered line of
credit, subject in all respects to each Lender's respective
discretion. Advances, if any, made under or pursuant to Facility B
shall be subject to the terms and provisions of (i) a Note to be
executed by Borrower evidencing such advance, (ii) this Bank Credit
Agreement; and (iii) such other conditions or provisions as either
Lender may require, in its sole discretion as defined in Section
1.1(b).
17. HOLIDAYS
17.1 Holidays. If the date provided herein for the payment
of any amount or the taking of any action falls on a Saturday, Sunday
or public holiday at the place for such payment or action, then the
due date for such payment or action will be the next preceding
business day.
18. LAW GOVERNING
18.1 Pennsylvania Law. This Agreement shall be construed in
accordance with and governed by the laws of the Commonwealth of
Pennsylvania.
19. WAIVER OF JURY TRIAL
19.1 Waiver of Jury Trial. Each undersigned party hereby
waives, and Lessor by its acceptance hereof thereby waives, trial by
jury in any legal proceeding involving, directly or indirectly, any
matter (whether sounding in tort, contract or otherwise) in any way
arising out of or related to this Agreement or the relationship
established hereunder. This provision is a material inducement for
Lessor to enter into, accept or rely upon this Agreement.
20. HEADINGS.
20.1 Headings Not Part of Agreement. The headings of the
Articles, Sections and paragraphs of this Agreement are inserted for
convenience only and shall not be deemed to constitute a part of this
Agreement.
21. COUNTERPARTS.
21.1 Counterparts. This Agreement may be executed in three
or more counterparts, and all such counterparts shall constitute one
and the same instrument.
EXECUTED as of the date first above written.
CORPORATE SEAL XXXXXXX LEASING CORP.
Attest:___________________________
BY:_______________________________
FIRST UNION NATIONAL BANK
BY:_______________________________
BANKBOSTON, N.A.
BY:_______________________________
EXHIBIT A
LOAN REQUEST
________________________
[Date]
To: First Union National Bank /__/
(Check one)
BankBoston, N.A. /__/
To Whom It May Concern:
The undersigned, ________________________________, refers to the
Bank Credit Agreement, dated as of ________________ (the "Credit
Agreement"; the terms defined therein being used herein as therein
defined), between the undersigned and BankBoston, N.A. or First Union
National Bank and hereby gives you notice pursuant to Section 1.3 of
the Credit Agreement that the undersigned hereby requests a Loan
under the Credit Agreement and, in that connection, sets forth below
the information relating to such Loan, as required by Section 1.3 of
the Credit Agreement. The undersigned also represents that the
requested borrowings will not exceed the Borrowing Base Amount at any
time.
Amount of the Loan requested ________________________
Interest rate option ________________________
________________________
Loan date ________________________
Principal amount of Loans outstanding
at the date of this Loan Request ________________________
Other information requested by Lender ________________________
Interest period ________________________
Reference Facility A /__/
(Check one)
B /__/
Very truly yours,
________________________________
By:_____________________________
Title:
EXHIBIT B
PENDING MATERIAL LITIGATION
None.
