Exhibit 10.27
LOAN AGREEMENT
$1,240,000.00 Term Loan
Lender: Regions Bank
Borrower: Pyramid Coach, Inc. and DW Leasing Company, LLC
Dated: As of June,2000
LOAN AGREEMENT
This Loan Agreement ("Agreement") entered into as of the 1St day of June,
2000, by and between Pyramid Coach, Inc., a Tennessee corporation, ("Pyramid")
and DW Leasing Company, LLC, a Mississippi limited liability company ("DW")
(Pyramid and DW are both individually and collectively referred to herein as the
"Borrower"), and Regions Bank ("Lender"), a banking corporation.
WITNESSETH:
WHEREAS, Lender has agreed to extend a term loan to Borrower, on certain
terms and conditions; and
WHEREAS, the proceeds of said term loan are to be paid directly to DW to
refinance and purchase certain buses, which buses will be managed and leased to
third parties by Pyramid; and
WHEREAS, Pyramid will retain a portion of the resulting lease income for
its management fee and remit the remainder to DW, which DW will then use to make
loan payments to Lender hereunder; and
WHEREAS, one condition to Lender's agreement to extend credit to Borrower
is that Lender and Borrower must enter into a comprehensive agreement setting
forth the terms and conditions of Borrower's term loan;
NOW, THEREFORE, as an inducement to cause Lender to extend credit to
Borrower, and for other valuable consideration, the receipt and sufficiency of
which are acknowledged, it is agreed as follows:
ARTICLE I
DEFINITIONS
1.01 Terms Used. As used in this Agreement, the following words have the
definitions indicated below unless context clearly requires otherwise:
(a) Affiliate shall mean with respect to any Person, any other person:(i)
which shares common ownership or control to any degree; or (ii) which
has an ownership interest or control in the former to any degree.
Additionally, in the case of natural Persons, immediate family members
shall be deemed Affiliates;
(b) Business shall mean all of Borrower's assets, both real and personal,
tangible and intangible, now existing or hereafter acquired and
wherever located and all of Borrower's current and future business
operations at all locations and jurisdictions;
(c) Business Day means any day on which Lender is open for business;
(d) Obligations, as used herein, shall mean all present and future debts
and other obligations of Borrower to Lender, whether arising by
contract, tort, guaranty, overdraft, or otherwise; whether or not the
advances or events creating such debts or other obligations are
presently foreseen; whether such obligations were originally payable
to Lender or are acquired by Lender from another person or entity; and
regardless of the class of the debts or other obligations, be they
otherwise secured or unsecured. The Obligations shall specifically
include, without limitation, the indebtedness and obligations
evidenced by that Promissory Note of even date made by Borrower and
payable to the order of Lender in the original principal amount of
$1,240,000.00, together with all modifications, amendments,
extensions, renewals and increases thereof; and
(e) Person means any natural person, corporation, partnership, joint
venture, association, trust or other legal entity.
1.02 Accounting Terms and Determinations. Unless otherwise specified
herein, all accounting terms used herein shall be interpreted, all accounting
determinations hereunder shall be made, and all financial statements required to
be delivered hereunder shall be prepared in accordance with generally accepted
accounting principles as in effect from time to time, consistently applied.
ARTICLE II
TERMS OF TERM LOAN
2.01 Term Loan. Concurrently with the execution of this Agreement, Lender
shall make a term loan (the "Loan") to Borrower on the following terms:
(a) Amount. The principal indebtedness of Borrower to Lender under the
Loan shall be One Million Two Hundred Forty Thousand and No/100
Dollars ($1,240,000.00);
(b) Interest Rate. The principal amount of the Loan outstanding shall bear
interest at the variable rate equal to three hundred basis points, or
three percent (3.0%), over the 30 day London Interbank Offered Rate
("LLBOR") as published in The Wall Street Journal under the section
entitled "Money Rates", as it may change from time to time; provided,
however, at no time will the interest rate be less than seven and
one-half percent (7.50%), per annum, nor greater than eleven and
one-half percent (11.50%) per annum; and further provided, that a
higher interest rate will be determined by Lender in its sole
discretion if both DW and Pyramid do not transfer their operating
accounts to Lender within thirty (30) business days after the closing
date and maintain such accounts with Lender throughout the term of the
Loan. Interest shall be calculated based upon a 360 day year and
actual days elapsed. In no event shall the interest rate charged on
the Loan exceed the maximum rate allowed under applicable law. Any
amounts paid in excess of the maximum lawful rate shall be applied to
reduce the principal amount hereof or shall be refunded to Borrower,
at Lender's election. After maturity (by acceleration or otherwise),
the principal amount under the Loan shall bear interest at the maximum
lawful rate; (c) Principal. Interest and Final Maturity. Payments,
inclusive of both principal and accrued interest, in the initial
amount of $16,120.07 each, shall become due on the 1st day of each
successive month, beginning on July 1, 2000. The amount of each
monthly payment is subject to adjustment and reamortization as
necessary at the end of each calendar quarter to reflect any changes
in the interest rate. All remaining principal and accrued interest
under the Loan shall become due and payable on June 1, 2003; and (d)
Prepayment. Prepayment of principal or accrued interest may be made,
in whole or in part, at any time without penalty. Prepayments shall be
applied to last maturing installments and shall not reduce or defer
payments next due.
2.02 Use of Proceeds. The proceeds of the Loan shall only be used by
Borrower to refinance existing debt and to acquire a bus.
ARTICLE Ill
ADDITIONAL CONDITIONS TO LOAN
3.01 Documentation. Concurrently with the execution hereof, Borrower shall
deliver to Lender the following documents (the "Loan Documents"), in form and
substance acceptable to Lender:
(a) This Agreement;
(b) Promissory Note made by Borrower in the principal amount of One
Million Two Hundred Forty Thousand and No/100 Dollars ($1,240,000.00)
payable to the order of Lender;
(c) Security Agreement granting Lender a first priority security interest
in five (5) luxury motor coaches as further described in Exhibit A,
attached hereto, together with Borrower's delivery to Lender of the
original certificates of title or, as to the one certain coach which
is being purchased by DW with the proceeds of this Loan, evidence
satisfactory to Lender in its sole discretion that the original
certificate of title showing no unreleased liens and a xxxx of sale
together therewith will be immediately forwarded to Lender by the
current owner of said coach upon said owner's receipt of the purchase
price;
(d) Unconditional and Continuing Guaranty Agreements executed by Xxxxxxx
X. Xxxxxx, Xxxxx X. Xxxxxxxxx and Xxxxx Xxxxxxxxx, respectively. (each
individually referred to as a "Guarantor" and collectively referred to
herein as the "Guarantors");
(e) Clean Certificate of Pyramid's Existence under Tennessee law issued by
the Tennessee Secretary of State; (f) Certified Copy of Pyramid's
Corporate Charter and Amendments (if any), issued by the Tennessee
Secretary of State;
(g) Certified copy of Resolution of Pyramid's Board of Directors
authorizing a named officer of Pyramid to enter into this Agreement
and to execute all related documents on Pyramid's behalf;
(h) Clean Certificate of DW's Good Standing under Mississippi law issued
by the Mississippi Secretary of State;
(i) Certified Copy of DW's Articles of Organization and Amendments (if
any), issued by the Mississippi Secretary of State;
(j) Certified copy of the Resolution of DW's Members authorizing a name
officer of DW to enter into this Agreement and to execute all related
documents on DW's behalf; and
(k) Closing Statement listing disbursements for all closing expenses.
3.02 No Material Changes. As of the time of closing, there shall have
occurred no material adverse change in the financial condition, operations, or
prospects of any party liable for the Obligations or affecting any collateral
therefor.
ARTICLE IV
WARRANTIES AND COVENANTS
4.01 Capacity. Pyramid warrants that it is and shall remain a duly
organized Tennessee corporation in good standing under the laws of Tennessee,
and that Pyramid is and shall remain duly qualified to do business in each state
other than Tennessee in which qualification is necessary. Pyramid warrants that
its execution of and performance under this Agreement and all related documents
are permitted under and will not violate any provision of Pyramid's Charter or
By-Laws. Pyramid further warrants that the execution of all necessary
resolutions and other prerequisites of corporate action have been duly performed
so that the individual executing this Agreement and related documents on behalf
of Pyramid is duly authorized to bind Pyramid by his signature. By signing below
on behalf of Pyramid, the individual executing this Agreement on behalf of
Pyramid also personally makes the warranties set forth in the preceding
sentence.
DW warrants that it is and shall remain a duly organized Mississippi
limited liability company in good standing under the laws of Mississippi, and
that DW is and shall remain duly qualified to do business in each state other
than Mississippi in which qualification is necessary. DW warrants that its
execution of and performance under this Agreement and all related documents are
permitted under and will not violate any provision of DW's Article of
Organization or Operating Agreement. DW further warrants that the execution of
all necessary resolutions and other prerequisites of company action have been
duly performed so that the individual executing this Agreement and related
documents on behalf of DW is duly authorized to bind DW by his signature. By
signing below on behalf of DW, the individual executing this Agreement on behalf
of DW also personally makes the warranties set forth in the preceding sentence.
4.02 No Subsidiaries. Each Borrower warrants that it presently has no
subsidiaries or interests in any partnership or other business entity, and each
Borrower covenants that it will not hereafter acquire stock of any other
privately held corporation or acquire an equity interest in any other business
entity, except for publicly traded companies, without the prior written approval
of Lender.
4.03 Corporate Records. Each Borrower covenants to maintain current
corporate minute books and stock ledgers and agrees to allow Lender to inspect
the same at any time.
4.04 ERISA. Neither Borrower has incurred nor shall it incur a material
accumulated funding deficiency within the meaning of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA") and has not incurred any
material liability to the Pension Benefit Guaranty Corporation established under
ERISA (or any successor thereto under ERISA) in connection with any retirement
plan, and no reportable event has occurred and is continuing or shall occur with
respect to any such plans.
4.05 Books and Records. Each Borrower covenants to maintain financial books
and records in accordance with generally accepted accounting principles,
consistently applied, and to allow Lender to inspect such records at any time.
4.06 Insurance. In addition to any specific insurance requirements
contained herein or in any other document pertaining to the Obligations, each
Borrower agrees to generally maintain adequate insurance against casualty and
liability losses in accordance with customary practices in each Borrower's field
of enterprise. Each Borrower agrees to provide Lender with proof of the
existence of such insurance upon demand, and with prompt written notice of any
casualty or liability loss.
4.07 Chief Executive Office. Each Borrower warrants that the address
designated herein to which notices are to be sent to each Borrower is each
Borrower's chief executive office. Each Borrower agrees to notify Lender in
writing of any change thereof and agrees that the same shall not in any event be
moved outside the present county in which it is located without Lender's prior
written consent.
4.08 No Defaults Under Other Agreements. Each Borrower warrants that
neither Borrower nor, to the best of each Borrower's knowledge, information, and
belief, any other party thereto is presently in default under or in breach of
any contract or agreement to which either Borrower is a party, and no condition
presently exists which, with the giving of notice, the passing of time, or both,
would cause such a default or breach.
4.09 Disclosure of Litigation. Each Borrower warrants that each is not
presently a party to any pending litigation, arbitration or administrative
proceeding or the subject of any investigation; that there is no litigation,
arbitration or administrative proceeding or investigation either threatened or
likely to be instituted in which Borrower will be a party; that neither Borrower
is subject to any outstanding court or administrative order; and that, to the
best of each Borrower's knowledge, information and belief, no facts exist which
give rise to claims by third parties against either Borrower which have not yet
been asserted. Each Borrower covenants to give Lender prompt written notice of
any litigation, arbitration, administrative proceeding or investigation that may
hereafter be instituted or threatened in which either Borrower would be a party,
whether or not Borrower's liability under such proceeding would be covered by
insurance.
4.10 Indemnity. Borrower does hereby agree to save, indemnify, and hold
harmless Lender from and against any and all claims, expenses, costs, demands or
liabilities whatsoever, including reasonable attorneys' fees, resulting from, or
in any way related to, the foregoing representations and warranties.
4.11 Financial Statements.
(a) Warranties. Borrower warrants that all financial statements delivered
to Lender in connection with the Obligations have been prepared in
accordance with sound accounting principles, consistently applied, and
are true, accurate and complete in every respect. Without limiting the
foregoing, Borrower warrants that such financial statements disclose
all known contingent liabilities as well as direct liabilities.
Borrower acknowledges that Lender has advanced (or shall advance) the
Obligations in reliance upon such financial statements, and Borrower
warrants that no material adverse change has occurred in the financial
condition of any person or entity as set forth in such financial
statements. Borrower warrants that Borrower has good and absolute
title to the assets disclosed on Borrower's balance sheet disclosed to
Lender, subject only to liens, security interests and other
encumbrances securing liabilities listed thereon; and
(b) Reporting Requirements. Borrower covenants to furnish to Lender, upon
demand, copies of Borrower's tax returns and additional financial
statements in form and substance acceptable to Lender. Lender may
require that any such financial statements be reviewed, at Borrower's
expense, by a certified public accountant acceptable to Lender. Lender
may require that any accountant who reviews, compiles or certifies
such financial statements expressly acknowledge Lender's reliance
thereon;
Without limiting the foregoing, Borrower agrees to provide Lender, without
demand, the following:
(i) On or before 90 days after the end of each fiscal year of each
Borrower, each Borrower's financial statements as well as
consolidated financial statements for both Borrowers jointly,
audited by a Certified Public Accountant acceptable to Lender;
(ii) On or before 10 days after the end of each calendar month, each
Borrower shall deliver to Lender each Borrower's internally
prepared financial statements, as well as consolidated financial
statements for both Borrowers jointly, including balance sheet
and income statement, all of which shall be certified to Lender
by each Borrower's president or managing member as applicable;
(iii)Within 5 days of the applicable filing date, and in no event
later than August 20, copies of each Borrower's tax returns for
such ended calendar year; and
(iv) On or before 120 days after the end of each calendar year, each
Guarantor's current personal financial statements and copies of
each Guarantor's personal tax returns for such ended calendar
year.
4.12 Notice of Changes in Financial Condition and Defaults. Each Borrower
covenants to give Lender prompt written notice of (i) the creation or discovery
of any material additional contingent liability or the occurrence of any other
material adverse change in the financial condition of either Borrower or of any
guarantor or other person or entity presently or hereafter liable for payment of
all or part of the Obligations, and (ii) the occurrence of any event, or
presence of any condition, which constitutes a default hereunder or which with
the giving of notice, the passing of time, or both, would constitute a default.
DW represents that its fiscal year is January 1 to December 31; and Pyramid
represents that its fiscal year is January 1 to December 31 and each Borrower
covenants that it will not change its fiscal year without obtaining the prior
written consent of Lender.
4.13 Contracts of Sale. Borrower covenants to provide Lender with prompt
written notice of all future contracts for sale of any of the assets listed on
Exhibit A, cancellation of any such existing contracts of sale, or the
occurrence of a material breach of any such contract for sale, whether such
contract is currently existing or hereafter executed, and whether the breach
occurs on the part of Borrower or any other party.
4.14 No Unpaid Taxes. Each Borrower warrants that neither Borrower is
presently delinquent in the payment of any taxes imposed by any governmental
authority or in the filing of any tax return and that neither Borrower is
involved in a dispute with any taxing authority over tax amounts due. Each
Borrower covenants that all future taxes due from either Borrower shall be
timely paid and that all tax returns required of either Borrower shall be timely
filed.
4.15 Ownership of Patents. Licenses. Etc. Each Borrower warrants that it
owns all licenses, permits, franchises, registrations, patents, copyrights,
trademarks, tradenames or service marks, or the rights to use the foregoing,
that are necessary for the continued operation of either Borrower's business.
4.16 No Untrue or Misleading Representations. Borrower warrants that no
information, exhibit or report furnished to Lender nor any statement or
representation made by Borrower to Lender in connection with the Obligations
contains any untrue statement of material fact or omits to state a material fact
necessary to make the foregoing not misleading.
4.17 Compliance with Law. Borrower- warrants that Borrower's business
activities are conducted in accordance with all applicable federal, state and
local laws and regulations, specifically including, without limitation, the
Americans with Disabilities Act, and all state and local building, zoning and
sanitary codes, and Borrower covenants that such activities shall continue to be
so conducted.
4.18 Assistance in Litigation. Borrower covenants to, upon request,
cooperatively participate in any proceeding in which Borrower is not an adverse
party to Lender and which concerns Lender's rights regarding the Obligations or
any collateral securing its payment.
4.19 Security Interest: Setoff. In order to further secure the payment of
the Obligations, Borrower hereby grants to Lender a security interest and right
of setoff against all of Borrower's presently owned or hereafter acquired
monies, items, credits, deposits and instruments (including certificates of
deposit) presently or hereafter in the possession of Lender. By maintaining any
such accounts or other property at Lender, Borrower acknowledges that Borrower
voluntarily subjects the property to Lender's rights hereunder. Lender may
exercise its rights under this Paragraph without prior notice following default.
Borrower agrees that Lender shall not be liable for the dishonor of any
instrument resulting from Lender's exercise of its rights under this Paragraph.
4.20 Expenses. Upon demand, Borrower will advance to Lender or, at Lender's
option, reimburse Lender for, the following expenses:
(a) Taxes. All taxes that Lender may be required to pay because of
the Obligations or because of Lender's interest in any property
securing the payment of the Obligations, except for taxes based
upon the general income of Lender;
(b) Administration. All expenses that Lender may incur in connection
with the preparation, execution, or enforcement of this Agreement
or of any other document pertaining to the Obligations;
(c) Protection of Collateral. All costs of preserving, insuring,
preparing for sale (whether by improvement, repair or otherwise)
or selling any collateral securing the Obligations;
(d) Costs of Collection. All court costs and other costs of
collecting any debt, overdraft or other obligation included in
the Obligations, including compensation for time spent by
employees of Lender;
(e) Litigation. All costs arising from any litigation, investigation,
or administrative proceeding (whether or not Lender is a party
thereto) that Lender may incur as a result of the Obligations or
as a result of Lender's association with Borrower, including, but
not limited to, expenses incurred by Lender in connection with a
case or proceeding involving Borrower under any chapter of the
Bankruptcy Code or any successor statute thereto; and
(f) Attorneys Fees. Reasonable attorneys' fees incurred in connection
with any of the foregoing.
If Lender pays any of the foregoing expenses, they shall become a part of the
Obligations and shall bear interest at the highest lawful rate, which is
currently 24% per annum. This Paragraph shall remain in full effect regardless
of the full payment of the Obligations, the purported termination of this
Agreement, the delivery of the executed original of this Agreement to Borrower,
or the content or accuracy of any representation made by Borrower to Lender;
provided, however, Lender may terminate this Paragraph by executing and
delivering to Borrower a written instrument of termination specifically
referring to this Paragraph.
4.21 Further Assurances. Borrower covenants to execute such other
assignments, security agreements, financing statements, and other documents
and/or pay such necessary expenses that Lender may deem necessary to further
evidence the obligations provided for herein or to perfect, extend, or clarify
Lender's rights in any property securing or intended to secure the Obligations.
Lender is hereby appointed as Borrower's attorney-in-fact for the signing of
such documents. Borrower acknowledges that this power of attorney is coupled
with an interest and is irrevocable.
4.22 Estoppel Letters. Borrower covenants to provide Lender, within five
(5) days after request, an estoppel letter stating (i) the balance of the
Obligations, (ii) whether Borrower has any defenses to payment of the
Obligations, and (iii) the nature of any defenses to payment of the Obligations.
Such balance as presented for confirmation and the nonexistence of defenses
shall be presumed if Borrower fails to respond to such a request within the
required period.
4.23 Default Certificates. Borrower covenants to deliver to Lender, within
two (2) business days after request, the certificate of Borrower or of
Borrower's appropriate representative (as specified by Lender) stating whether,
to the best of the person's knowledge, information, and belief and after due
investigation, a default exists under this Agreement. The certificate shall
describe with particularity any default and shall address with particularity any
circumstances or subjects described by Lender in its request.
4.24 Recitals. Borrower warrants and agrees that the recitals set forth at
the beginning of this Agreement are true.
4.25 No Burdensome Agreements. Borrower warrants that, to the best of its
knowledge, information and belief, Borrower is not a party to any contract or
agreement and is not subject to any contingent liability that does or may impair
Borrower's ability to perform under the terms of this Agreement. Borrower
further warrants that the execution and performance of this Agreement will not
cause a default, acceleration or other event under any other contract or
agreement to which Borrower or any property of Borrower is subject, and will not
result in the imposition of any charge, penalty, lien or other encumbrance
against any of Borrower's property, except in favor of Lender.
4.26 Legal and Binding Agreement. Borrower warrants that the execution,
delivery and performance of this Agreement will not violate any judicial or
administrative order or governmental law or regulation, and that this Agreement
is valid, binding and enforceable in every respect according to its terms.
4.27 No Consent Required. Borrower warrants that Borrower's execution,
delivery and performance of this Agreement do not require the consent of or the
giving of notice to any third party including, but not limited to, any other
lender, governmental body or regulatory authority.
4.28 No Default. Borrower warrants that, as of the execution of this
Agreement, no default exists hereunder and no condition exists which, with the
giving of notice, the passing of time, or both, would constitute such a default.
4.29 Negative Covenants. Without Lender's prior written consent, neither
Borrower shall do any of the following:
(a) Distributions. Declare a distribution or dividend (of cash,
property, stock or financial rights) in excess of net profit for
any fiscal year;
(b) Reorganization. Enter into any agreement to merge, consolidate,
or otherwise reorganize or recapitalize;
(c) Change of Business. Engage in any business other than the
business presently engaged in by Borrower;
(d) Disposition of Assets. Sell or otherwise transfer a substantial
amount of its assets;
(e) Change in Ownership or Management. Change the identity of company
majority ownership or management, including, without limitation,
any change in the occupancy of the positions of president, vice
president, secretary, treasurer, chief executive officer and
managing members;
(f) Insider Contracts. Enter into or permit to exist any management,
consulting or employment contract or other contract (except for
those terminable without premium or penalty upon no more than
sixty (60) days notice) with any director, shareholder, or
officer of Borrower, except for Xxxxxxxx Xxxxxx;
(g) Amendments. Amend its corporate Charter or By-Laws or its
Articles of Organization or Operating Agreement;
(h) Guaranties. Guarantee any obligations of any other business or
individual;
(i) Loans. Make any loan to any other party, except for the granting
of unsecured trade credit in the ordinary course of business;
(j) Additional Locations. Open any additional offices; and
(k) Action Outside Ordinary Course. Take any other action outside the
ordinary course of its business.
4.30 Financial Covenants. Borrower shall maintain the following financial
requirement as determined in accordance with Generally Accepted Accounting
Principles ("GAAP"), to be calculated monthly on a rolling twelve month basis
(except throughout calendar year 2000, which will be calculated on the months
that Borrower has been in existence) and on a consolidated basis based on the
consolidated financial statements provided to Lender by Borrower:
Debt Coverage Ratio. Borrower's Consolidated Debt Coverage Ratio, defined as the
ratio of (i) consolidated earnings before interest, taxes, depreciation and
amortization expense to (ii) the sum of consolidated current maturities of long
term debt plus consolidated interest expense, shall not fall below 1.30 to 1.00
throughout the term of the Loan.
ARTICLE V
DEFAULTS AND REMEDIES
5.01 Default Defined. The occurrence of any one or more of the following
events shall constitute a default under this Agreement:
(a) Monetary Default. The failure of Borrower to timely pay any
amount due Lender under the Obligations or under any other
obligation to Lender;
(b) Breach of Covenant. The failure of Borrower or any other party to
perform or observe any obligation or covenant made with respect
to the Obligations;
(c) Breach of Warranty. Lender's discovery that any representation or
warranty made in connection with this Agreement or the
Obligations is materially false;
(d) Default Under Other Document. The occurrence of a default under
the terms of any document evidencing, securing, or otherwise
pertaining to the Obligations;
(e) Hazardous Waste Liability. The incurrence of any liability for
hazardous waste for which either Borrower is responsible for
cleaning up, if such cleanup liability is in excess of
$25,000.00; and
(f) The decline in the market value of unencumbered liquid assets of
all Guarantors jointly to an amount less than $500,000.00.
5.02 Remedies Upon Default. Upon the occurrence of a default hereunder,
Lender may exercise any or all of the following remedies:
(a) Security Documents. Lender may exercise any right that it may
have under any document evidencing or securing the Obligations;
(b) Setoff. Lender may exercise its lien upon and right of setoff
against any monies, items, credits, deposits or instruments that
Lender may have in its possession and which belong to Borrower or
to any other person or entity liable for the payment of any or
all of the Obligations;
(c) Other Remedies. Lender may exercise any right that it may have at
law or equity; and
(d) Application of Proceeds. All amounts received by Lender for
Borrower's account by exercise of its remedies hereunder shall be
applied as follows: First, to the payment of all expenses
incurred by Lender in exercising its rights hereunder, including
attorney's fees, and any other expenses due Lender from Borrower;
Second, to the payment of all interest included in the
Obligations, in such order as Lender may elect; Third, to the
payment of all principal included in the Obligations, in such
order as Lender may elect; and Fourth, surplus to Borrower or
other party entitled thereto.
ARTICLE VI
GENERAL PROVISIONS
6.01 Consent to Jurisdiction. Borrower hereby irrevocably consents to the
jurisdiction of the United States District Court for the Middle District of
Tennessee and of all Tennessee state courts sitting in Davidson County,
Tennessee, for the purpose of any litigation to which Lender may be a party and
which concerns this Agreement or the Obligations. It is further agreed that
venue for any such action shall lie exclusively with courts sitting in Davidson
County, Tennessee, unless Lender agrees to the contrary in writing.
6.02 Not Partners: No Third Party Beneficiaries. Nothing contained herein
or in any related document shall be deemed to render Lender a partner of
Borrower for any purpose. This Agreement has been executed for the sole benefit
of Lender, and no third party is authorized to rely upon Lender's rights
hereunder or to rely upon an assumption that Lender has or will exercise its
rights under this Agreement or under any document referred to herein.
6.03 No Marshalling of Assets. Lender may proceed against collateral
securing the Obligations and against parties liable therefor in such order as it
may elect, and neither Borrower nor any surety or guarantor for Borrower nor any
creditor of Borrower shall be entitled to require Lender to xxxxxxxx assets. The
benefit of any rule of law or equity to the contrary is hereby expressly waived.
6.04 Impairment of Collateral. Lender may, in its sole discretion, release
any collateral securing the Obligations or release any party liable therefor.
The defenses of impairment of collateral and impairment of recourse and any
requirement of diligence on Lender's part in collecting the Obligations are
hereby waived.
6.05 Regulation U. Borrower warrants that none of the proceeds of the loan
evidenced by the Note will be used to purchase or carry "margin stock," as
defined in Regulation / U issued by the Federal Reserve Board.
6.06 Business Days. If any payment date under the Obligations falls on a
day that is not a business day of Lender, or if the last day of any notice
period falls on such a day, the payment shall be due and the notice period shall
end on the following Lender business day.
6.07 Notices. Any communications concerning this Agreement or the credit(s)
described herein shall be addressed as follows:
As to Borrower: Pyramid Coach, Inc.
0000 Xxx Xxxx Xxxx
Xxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
XX Leasing Company, LLC
000 Xxxxxxxx Xxxx Xxxxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
With a copy to: Durham Xxxxxxxxx and Associates
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
As to Lender: Regions Bank
000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxxx X. Sparta
With a copy to: Xxxxx X. Xxxx, Attorney
Xxx Xxxx & Xxxxxx, PLLC
315 Xxxxxxxxx Street
Suite 0000 XxXxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Communications shall be effective when set forth in writing and actually
received or when set forth in writing and mailed (postage prepaid) or delivered
to the receiving party's address stated above. Any party may change its address
for receipt of notices by submitting the change in writing to the other party.
6.08 Participations. Lender may, from time to time, in its sole discretion
and without notice to Borrower, sell participations in any credit subject hereto
to such other investors or financial institutions as it may elect. Lender may
from time to time disclose to any participant or prospective participant such
information as Lender may have regarding the financial condition, operations,
and prospects of Borrower.
6.09 Notice to Lender Upon Perceived Breach. Borrower agrees to give Lender
written notice of any action or inaction by Lender in connection with this
Agreement or the Obligations that Borrower believes may be actionable against
Lender or a defense to payment for any reason, including, but not limited to,
commission of a tort or violation of any contractual duty or duty implied by
Law. Borrower agrees that unless such notice is duly given as promptly as
possible (and in any event within ten (10) days ) after Borrower learns of any
such action or inaction, Borrower shall not assert against Lender, and Borrower
shall be deemed to have waived, any claim or defense arising therefrom.
6.10 Incorporation of Exhibits. All Exhibits referred to in this Agreement
are incorporated herein by this reference.
6.11 Indulgence Not Waiver. Lender's indulgence in the existence of a
default hereunder or any other departure from the terms of this Agreement shall
not prejudice Lender's rights to declare a default or otherwise demand strict
compliance with this Agreement.
6.12 Cumulative Remedies. The remedies provided Lender in this Agreement
are not exclusive of any other remedies that may be available to Lender under
any other document or at law or equity.
6.13 Amendment and Waiver in Writin2. No provision of this Agreement can be
amended or waived, except by a statement in writing signed by the party against
which enforcement of the amendment or waiver is sought.
6.14 Assignment. This Agreement shall be binding upon and inure to the
benefit of the respective heirs, successors and assigns of Borrower and Lender,
except that Borrower shall not assign any rights or delegate any obligations
arising hereunder without the prior written consent of Lender. Any attempted
assignment or delegation by Borrower without the required prior consent shall be
void.
6.15 Entire Agreement. This Agreement and the other written agreements
between Borrower and Lender represent the entire agreement between the parties
concerning the subject matter hereof, and all oral discussions and prior
agreements are merged herein. Provided, if there is a conflict between this
Agreement and any other document executed contemporaneously herewith with
respect to the Obligations, the provision most favorable to Lender shall
control.
6.16 Severability. Should any provision of this Agreement be invalid or
unenforceable for any reason, the remaining provisions hereof shall remain in
full effect.
6.17 Time of Essence. Time is of the essence of this Agreement, and all
dates and time periods specified herein shall be strictly observed, except that
Lender may permit specific deviations therefrom by its written consent.
6.18. Waiver of Trial By Jury. The parties hereto waive any right to trial
by jury of any claim, demand, action or cause of action (1) arising hereunder or
any other instrument, document or agreement executed or delivered in connection
herewith or in connection with the Obligations, or (2) in any way connected with
or related or incidental to the dealings of the parties hereto or any of them
with respect hereto or any other instrument, document or agreement executed or
delivered in connection herewith or in connection with the Obligations, or the
transactions related hereto or thereto, in each case whether now existing or
hereafter arising, and whether sounding in contract or tort or otherwise; and
each party hereby agrees and consents that any such claim, demand, action or
cause of action shall be decided by court trial without a jury, and that any
party hereto may file an original counterpart or a copy of this section with any
court as written evidence of the consent of the parties hereto to the waiver of
their right to trial by jury.
6.19 Applicable Law. The validity, construction and enforcement of this
Agreement and all other documents executed with respect to the Obligations shall
be determined according to the laws of Tennessee applicable to contracts
executed and performed entirely within that state, in which state this Agreement
has been executed and delivered.
6.20 Gender and Number. Words used herein indicating gender or number shall
be read as context may require. All agreements, representations, warranties and
covenants made herein by Borrower are expressly made by each Borrower
individually and both Borrowers jointly, and all liability of Borrower hereunder
is joint and several as to Pyramid and DW.
6.21 Captions Not Controlling. Captions and headings have been included in
this Agreement for the convenience of the parties, and shall not be construed as
affecting the content of the respective paragraphs.
EXECUTED the date first written above.
THE UNDERSIGNED ACKNOWLEDGE A THOROUGH UNDERSTANDING OF THE
TERMS OF THIS AGREEMENT AND AGREE TO BE BOUND THEREBY:
REGIONS BANK, Lender
By: ___________________________________________________
Title: ________________________________________________
PYRAMID COACH, INC., Borrower
By: ___________________________________________________
XXXXXXX X. XXXXXX, President
DW LEASING COMPANY, LLC, Borrower
By: ___________________________________________________
XXXXXXX X. XXXXXX, Member
By: ___________________________________________________
XXXXX X. XXXXXXXXX, Member
EXHIBIT A
Five (5) luxury motor coaches with vehicle identification numbers as follows:
1996 Prevost Conversion VIN #0XXX0000XX0000000
1996 Eagle 15-45 Conversion VIN #0XXXX0X00XX000000
1995 Eagle 15-45 Conversion VIN #1EUBM6A13SBOO4O63
1996 Eagle 15-45 Conversion VIN #1EUBM6A13TBOO4O81
1997 Eagle 15-45 Conversion VIN #XXXXX0X00XX000000
PROMISSORY NOTE
$1,240,000.00 As of June 1, 2000
FOR VALUE RECEIVED, Pyramid Coach, Inc. and DW Leasing Company, LLC
("Makers") jointly and severally promise to pay to the order of Regions Bank, a
banking corporation ("Payee"), the sum of One Million Two Hundred Forty Thousand
and No/100 Dollars ($1,240,000.00), together with interest thereon at the
variable rate of equal to three hundred basis points, or three percent (3.0%)
over the 30 day London Interbank Offered Rate ("LIBOR") as published in The Wall
Street Journal under the section entitled "Money Rates", as it may change from
time to time; provided, however, at no time will the interest rate be less than
seven and one-half percent (7.50%), per annum, nor greater than eleven and
one-half percent (11.50%) per annum. Payments, inclusive of both principal and
accrued interest, in the initial amount of $16,120.07 each, shall become due on
the 1S~ day of each successive month, beginning on July 1, 2000. The amount of
each payment is subject to adjustment and reamortization as necessary at the end
of each calendar quarter to reflect any changes in the interest rate. All
remaining principal and accrued interest under the Note shall become due and
payable on June 1, 2003.
Interest hereunder shall be calculated based upon a 360 day year and actual
days elapsed. The interest rate required hereby shall not exceed the maximum
rate permissible under applicable law, and any amounts paid in excess of such
rate shall be applied to reduce the principal amount hereof or shall be refunded
to Makers, at the option of the holder of this Note.
All amounts due under this Note are payable at par in lawful money of the
United States of America, at the principal place of business of Payee in
Nashville, Tennessee, or at such other address as the Payee or other holder
hereof (herein "Holder") may direct.
Any payment not made within fifteen (15) days of its due date will be
subject to assessment of a late charge equal to five percent (5%) of such
payment or such lesser amount as permitted by applicable law. Holder's right to
impose a late charge does not evidence a grace period for the making of payments
hereunder.
The occurrence of any of the following shall constitute an event of default
under this Note: (a) the failure of any Maker to make any payment when due under
this or any other obligation to Holder (time is of the essence of this Note);
(b) the institution of proceedings by any Maker under any state insolvency law
or under any federal bankruptcy law; (c) the institution of proceedings against
any Maker under any state insolvency law or under any federal bankruptcy law, if
such proceedings are not dismissed within thirty (30) days; (d) any Maker's
becoming insolvent or generally failing to pay its debts as they become due; (e)
the discovery by Holder that any Maker has made a material misrepresentation of
financial condition in any oral or written statement made to any present or
previous Holder; (t) the instigation of legal proceedings against any Maker for
the violation of a criminal statute or for failure to pay state or federal
taxes; (g) the decline of the market value of collateral securing this Note
below the amount outstanding hereunder, unless Makers tender sufficient
additional collateral acceptable to Holder; (h) the issuance of an attachment
against property of any Maker unless removed, by bond or otherwise, within ten
(10) days; (i) the entry of a final judgment against any Maker that remains
unsatisfied for five (5) days after execution may first issue; (j) any Maker's
liquidation or cessation of business; (k) the occurrence of a material change in
the control or ownership of any Maker; (1) the occurrence of a default under the
terms of any loan agreement, security agreement, deed of trust, or similar
document to which any Maker is a party or to which any property securing this
Note is subject; (in) if any Maker is an individual, the death, adjudication of
insanity of, or appointment of a conservator for, such Maker, or such Maker's
becoming a party to a divorce proceeding; (n) the occurrence of any of the
foregoing with regard to any surety, guarantor, endorser, or other person or
entity primarily or secondarily liable for the payment of the indebtedness
evidenced by this Note; (o) any material adverse change in the financial
condition of any Maker or Guarantor of this Note; or (p) the occurrence of any
event or presence of any condition that causes Holder in good faith to feel
insecure regarding the likelihood of its receiving orderly and complete payment
according to the terms of this Note.
Upon the occurrence of an event of default, as defined above, Holder may,
at its option and without notice, declare all principal and interest provided
for under this Note, and any other obligations of any or all Makers to Holder,
to be presently due and payable, and Holder may enforce any remedies available
to Holder under any documents securing or evidencing such obligations. Holder
may waive any default before or after it occurs and may restore this Note in
full effect without impairing the right to declare it due for a subsequent
default, this right being a continuing one. Upon default, the remaining unpaid
principal balance of the indebtedness evidenced hereby and all expenses due
Holder shall bear interest at the highest rate permissible under applicable law.
All amounts received for payment of this Note shall be first applied to any
expenses due Holder under this Note or under any other documents evidencing or
securing obligations of any Maker to Holder, then to accrued interest, and
finally to the reduction of principal. Prepayment of principal or accrued
interest may be made, in whole or in part, at any time without penalty. Any
prepayment(s) shall reduce the final payment(s) and shall not reduce or defer
installments next due.
This Note may be freely transferred by Holder.
Makers and all sureties, guarantors, endorsers and other parties to this
instrument hereby consent to any and all renewals, waivers, modifications, or
extensions of time (of any duration) that may be granted by Holder with respect
to this Note and severally waive demand, presentment, protest, notice of
dishonor, and all other notices that might otherwise be required by law. All
parties hereto waive the defense of impairment of collateral and all other
defenses of suretyship.
Makers' performance under this Note is secured by various property, as
further described in that Loan Agreement of even date executed by Makers and
Payee, pursuant to which this Note is executed.
Makers and all sureties, guarantors, endorsers and other parties hereto
agree to pay reasonable attorneys' fees and all court and other costs that
Holder may incur in the course of efforts to collect the debt evidenced hereby
or to protect Holder's interest in any collateral securing the same.
The validity and construction of this Note shall be determined according to
the laws of Tennessee applicable to contracts executed and performed with that
state. If any provision of this Note should for any reason be invalid or
unenforceable, the remaining provisions hereof shall remain in full effect.
The provisions of this Note may be amended or waived only by instrument in
writing signed by the Holder and Makers and attached to this Note.
Words used herein indicating gender or number shall be read as context may
require.
PYRAMID COACH, INC., Maker
By:_______________________________________
XXXXXXX X. XXXXXX, President
DW LEASING COMPANY, LLC, Maker
By:_______________________________________
XXXXXXX X. XXXXXX, Member
By:_______________________________________
XXXXX X. XXXXXXXXX, Member
VEHICLE SECURITY AGREEMENT
This Vehicle Security Agreement ("Agreement") entered into as of the
1st day of June, 2000, by and between DW Leasing Company, LLC, a Mississippi
limited liability company ("Grantor") and Regions Bank ("Lender"), a banking
corporation.
WITNESSETH
WHEREAS, Lender has agreed to extend credit to DW Leasing Company, LLC and
Pyramid Coach, Inc. (collectively the "Borrower"), on certain terms and
conditions; and
WHEREAS, one condition to Lender's agreement to extend credit to Borrower
is that Lender must be provided a first priority perfected security interest in
certain of Grantor's property;
NOW, THEREFORE, as an inducement to cause Lender to extend credit to
Borrower, and for other valuable consideration, the receipt and sufficiency of
which are acknowledged, it is agreed as follows:
a. Definition of Secured Indebtedness. As used herein, "Secured
Indebtedness" shall mean all present and future debts and other obligations of
Borrower and/or Grantor to Lender, whether arising by contract, tort, guaranty,
overdraft, or otherwise; whether or not the advances or events creating such
debts or other obligations are presently foreseen; whether such obligations were
originally payable to Lender or are acquired by Lender from another person or
entity; and regardless of the class of the debts or other obligations, be they
otherwise secured or unsecured. Without limiting the foregoing, the "Secured
Indebtedness" specifically includes the obligations of Grantor under this
Agreement and the indebtedness and obligations evidenced by that Promissory Note
made by Borrower m the original principal amount of $1,240,000.00, payable to
the order of Lender and all modifications, amendments, extensions, renewals and
increases thereof.
x. Xxxxx of Security Interest. To secure the payment of the Secured
Indebtedness, Grantor hereby grants to Lender a security interest in those five
(5) luxury model motor coaches as further described on Exhibit A, attached
hereto and incorporated herein, and all products and proceeds thereof (all as
defined in the Uniform Commercial Code as adopted in Tennessee), including
insurance proceeds, and all parts, attachments, additions, replacements,
components and accessions thereto, all records pertaining thereto and all
leases, warranties and other rights pertaining thereto (collectively the
"Collateral").
c. Warranties. Grantor warrants to Lender the following:
(1) Title. Grantor is the sole legal and equitable owner of the
Collateral.
(2) No Other Encumbrances. The Collateral is not subject to any
security interest, lien, option or other encumbrance, except for
the security interest provided for in the Agreement.
(3) Valid Lien. This Agreement grants to Lender a valid first
priority security interest in the Collateral which will be
properly perfected upon Lender's lien being noted on the
certificates of title pertaining to each vehicle.
d. Maintenance of Collateral. Grantor shall take all reasonable measures to
protect the Collateral and to maintain the Collateral in good condition. Grantor
shall notify Lender of any event or condition that materially impairs the value
of the Collateral.
e. Insurance. Grantor shall obtain and keep current comprehensive casualty
insurance and such other insurance as Lender may require on the Collateral in an
amount equal to its maximum insurable value, with insurers and insurance
policies that are acceptable to Lender. Grantor shall deliver copies of all
insurance policies covering the Collateral to Lender. All such policies shall
name Lender as loss payee and shall provide that coverage shall not be
terminated or amended without at least twenty (20) days prior written notice to
Lender. If Grantor fails to provide evidence that it has obtained the required
insurance or if Grantor fails to pay the premiums therefor, Lender may, at its
option, obtain or bring current insurance coverage on the Collateral. Any
insurance obtained by Lender may, at Lender's option, insure only its interest
in the Collateral. Grantor hereby assigns to Lender any claim settlements,
unearned premiums or other payments that may be made by or on behalf of an
insurer under a policy covering the Collateral, and Grantor hereby directs such
insurer(s) to pay Lender any amount so due. Lender is hereby appointed Grantor's
attorney-in-fact to endorse with Grantor's name any draft or check that may be
issued by or on behalf of the issuer of any insurance policy covering the
Collateral. All proceeds, unearned premiums, or other sums received by Lender as
a result of said insurance policies may be applied by Lender, at its option and
in its sole discretion, and in whole or in part, to the reduction of the Secured
Indebtedness, in such manner as Lender may determine, or may be paid to Grantor
with or without restrictions.
f. Compliance With Law; Taxes. Grantor shall comply with all laws,
regulations and other requirements of governmental bodies or agencies having
jurisdiction pertaining to the ownership or operation of the Collateral, and
Grantor shall pay all taxes and fees assessed on account of the Collateral as
they become due.
g. Sale or Encumbrance Prohibited. Grantor shall not sell the Collateral
nor shall Grantor grant or allow any security interest, lien, attachment or
other encumbrance to attach to the Collateral, except in favor of Lender,
without the prior written consent of Lender.
h. Inspection. Agents of Lender shall be allowed to inspect the Collateral
at anytime.
i. Availability Upon Default. Grantor covenants that if Lender declares a
default hereunder and so requests, Grantor shall make the Collateral and all
records pertaining thereto available to Lender at a reasonable time and place.
j. Rental Proceeds. The security interest granted herein extends to all of
Grantor's rights as lessor under any present or future lease of any of the
Collateral. Grantor acknowledges and agrees that all rental proceeds of the
Collateral constitute "cash collateral" under the Bankruptcy Code, as it may be
amended. Notwithstanding Lender's consent to any proposed lease, such lease
shall be subordinate to Lender's security interest in the Collateral unless
Lender specifically agrees to the contrary in writing.
k. Warranties and Other Rights. The security interest granted herein
extends to all of Grantor's rights under warranties pertaining to the Collateral
and also includes all rights of Grantor against any third party arising from
damage to any Collateral. Grantor agrees to give Lender prompt written notice of
any warranty claim or other claim that Grantor may have against a third party as
a result of the condition or performance of the Collateral or as a result of any
damage caused thereto. No such claim shall be settled without the prior written
consent of Lender.
1. Recitals. Grantor warrants and agrees that the recitals set forth at the
beginning of this Agreement are true.
m. No Burdensome Agreements. Grantor warrants that Grantor is not a party
to any contract or agreement and is not subject to any contingent liability that
does or may impair Grantor's ability to perform under the terms of this
Agreement. Grantor further warrants that the execution and performance of this
Agreement will not cause a default, acceleration or other event under any other
contract or agreement to which Grantor or any property of Grantor is subject,
and will not result in the imposition of any charge, penalty, lien or other
encumbrance against any of Grantor's property except m favor of Lender.
n. Legal and Binding Agreement. Grantor warrants that the execution and
performance of this Agreement will not violate any judicial or administrative
order or governmental law or regulation, and that this Agreement is valid,
binding and enforceable in every respect according to its terms.
o. No Consent Required. Grantor warrants that Grantor's execution, delivery
and performance of this Agreement do not require the consent of or the giving or
notice to any third party including, but not limited to, any other lender,
governmental body or regulatory authority.
p. No Default. Grantor warrants that, as of the execution of this
Agreement, no default exists hereunder and no condition exists which, with the
giving of notice, the passing of time, or both, would constitute such a default.
q. Default Defined. The occurrence of any one or more of the following
events shall constitute a default under this Agreement:
(1) Monetary Default. The failure of Grantor to timely pay any amount
due Lender under the Secured Indebtedness or under any other
obligation to Lender.
(2) Breach of Covenant. The failure of Grantor or any other party to
perform or observe any obligation or covenant made with respect
to the Secured Indebtedness.
(3) Breach of Warranty. Lender's discovery that any representation or
warranty in connection with this Agreement or the Secured
Indebtedness is materially false.
(4) Default Under Other Document. The occurrence of a default under
the terms of any document evidencing, securing, or otherwise
pertaining to the Secured Indebtedness.
r. Remedies Upon Default. Upon default, Lender may pursue any of all of the
following remedies, without any notice to Grantor except as required below:
(1) Repossession. Lender may take possession of the Collateral
without prior notice to Grantor. Such repossession may be
accomplished wherever the Collateral might be found and
regardless of whether Grantor, a lessee, repair shop, or any
other party is then in possession of the Collateral. Lender may
take any measure necessary to render the Collateral inoperable
pending disposition by Lender. Lender is hereby authorized to
obtain the key code for the Collateral from any person or entity
and to obtain from any repair shop or other bailee any keys for
the Collateral in their possession, and any such person or entity
is hereby directed to comply with Lender's demand for such code
or keys without any duty of inquiry and without any liability to
Grantor. Grantor consents to Lender's entry on Grantor's premises
to repossess the Collateral provided that Lender causes no
significant damage to the premises in the process of entry
(drilling of locks, cutting of chains and the like do not in
themselves cause "significant" damage for the purposes hereof)
and provided that Lender accomplishes such entry without a breach
of peace.
(2) Recovery of Proceeds of Leases. Lender may recover any and all
proceeds of leases of the Collateral from Grantor's bank or from
any other custodian thereof.
(3) Enforcement of Rights under Leases. Lender may, but shall not be
obligated to, take such measures as Lender may deem necessary in
order to collect any or all amounts due under any leases of the
Collateral and/or to perform or have performed any remaining
obligations of Grantor under any leases of the Collateral.
Without limiting the foregoing, Lender may institute any
administrative or judicial action that it may deem necessary in
the course of collecting and enforcing any or all of Grantor's
rights under such lease(s). Any administrative or judicial action
or other action taken by Lender may be taken by Lender in its own
name or in Grantor's name. Lender may compromise any disputed
claims and may otherwise enter into settlements with respect to
such lease(s), which compromises or settlements shall be binding
upon Grantor. Grantor hereby appoints Lender as Grantor's
attorney-in-fact for the purpose of taking any action in
connection with such lease(s), including the institution of
administrative or judicial proceedings and the compromising of
claims.
(4) Repair and Improvement of Collateral. Lender may make such
repairs or improvements to the Collateral as it may deem
appropriate to prepare the Collateral for sale.
(5) Sale of Collateral. Pursuant to its rights under the Uniform
Commercial Code as adopted in Tennessee, Lender may sell the
Collateral at either public or private sale. Any required notice
of sale shall be deemed commercially reasonable if given at least
five (5) days prior to sale. Lender may adjourn any public or
private sale to a different time or place without notice or
publication of such adjournment, and may adjourn any sale either
before or after offers are received.
(6) Setoff. Lender may exercise its lien upon and right of setoff
against any monies, items, credits, deposits or instruments that
Lender may have in its possession and which belong to Grantor or
to any other person or entity liable for the payment of any or
all of the Secured Indebtedness.
(7) Other Remedies. Lender may exercise any right that it may have
under any other document evidencing or securing the Secured
Indebtedness or otherwise available to Lender at law or equity.
(8) Application of Proceeds. All amounts received by Lender for
Grantor's account by exercise of its remedies hereunder shall be
applied as follows: First, to the payment of all expenses
incurred by Lender in exercising its rights hereunder, including
attorney's fees, and any other expenses due Lender from Grantor;
Second, to the payment of all interest included in the Secured
Indebtedness, in such order as Lender may elect; Third, to the
payment of all principal included in the Secured Indebtedness, in
such order as Lender may elect; and Fourth, surplus to Grantor or
other party entitled thereto.
s. Incorporation of Exhibits. All Exhibits referred to in this Agreement
are incorporated herein by this reference.
t. Indulgence Not Waiver. Lender's indulgence in the existence of a default
hereunder or any other departure from the terms of this Agreement shall not
prejudice Lender's rights to declare a default or otherwise demand strict
compliance with this Agreement.
u. Cumulative Remedies. The remedies provided Lender in this Agreement are
not exclusive or any other remedies that may be available to Lender under any
other document or at law or equity.
v. Amendment and Waiver in Writing. No provision of this Agreement can be
amended or waived, except by a statement in writing signed by the party against
which enforcement of the amendment or waiver is sought.
w. Assignment. This Agreement shall be binding upon and inure to the
benefit of the respective heirs, successors and assigns of Grantor and Lender,
except that Grantor shall not assign any rights or delegate any obligations
arising hereunder without the prior written consent of Lender. Any attempted
assignment or delegation by Grantor without the required prior consent shall be
void.
x. Entire Agreement. This Agreement and the other written agreements
between Grantor and Lender represent the entire agreement between the parties
concerning the subject matter hereof, and al oral discussions and prior
agreements are merged herein. Provided, if there is a conflict between this
Agreement and any other document executed contemporaneously herewith with
respect to the Secured Indebtedness, the provision most favorable to Lender
shall control.
y. Severability. Should any provisions of this Agreement be invalid or
unenforceable for any reason, the remaining provisions hereof shall remain in
full effect.
z. Time of Essence. Time is of the essence of the Agreement, and all dates
and time periods specified herein shall be strictly observed, except that Lender
may permit specific deviations therefrom by its written consent.
aa. Applicable Law. The validity, construction and enforcement of this
Agreement and all other documents executed with respect to the Secured
Indebtedness shall be determined according to the laws of Tennessee applicable
to contracts executed and performed entirely within that state, in which state
this Agreement has been executed and delivered.
ab. Gender and Number. Words used herein indicating gender or number shall
be read as context may require.
ac. Captions Not Controlling. Captions and headings have been included in
this Agreement for the convenience of the parties, and shall not be construed as
affecting the content of the respective paragraphs.
Executed the date first written above.
THE UNDERSIGNED ACKNOWLEDGE
A THOROUGH UNDERSTANDING OF
THE TERMS OF THIS AGREEMENT
AND AGREE TO BE BOUND
THEREBY:
DW LEASING COMPANY, LLC, Grantor
By: _______________________________
XXXXXXX X. XXXXXX, Member
By: _______________________________
XXXXX X. WIIITESELL, Member
REGIONS BANK, Lender
By: _____________________________
Title: ____________________________
STATE OF INDIANA
COUNTY OF ___________
Before me, a Notary Public of the State and County aforesaid, personally
appeared Xxxxxxx X. Xxxxxx, with whom I am personally acquainted (or proved to
me on the basis of satisfactory evidence) and who, upon oath, acknowledged
himself to be a member of DW Leasing Company, LLC, the within named bargainor, a
Mississippi limited liability company, and that he as such member, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the limited liability company by himself as member.
WITNESS my hand and seal, this _____ day of May, 2000.
-----------------------------------
NOTARY PUBLIC
My Commission Expires:___________________
STATE OF INDIANA
COUNTY OF ___________
Before me, a Notary Public of the State and County aforesaid, personally
appeared Xxxxx X. Xxxxxxxxx, with whom I am personally acquainted (or proved to
me on the basis of satisfactory evidence) and who, upon oath, acknowledged
himself to be a member of DW Leasing Company, LLC, the within named bargainor, a
Mississippi limited liability company, and that he as such member, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the limited liability company by himself as member.
WITNESS my hand and seal, this _____ day of May, 2000.
-----------------------------------
NOTARY PUBLIC
My Commission Expires:_____________________
STATE OF INDIANA COUNTY OF
Before me, a Notary Public of the State and County aforesaid, personally
appeared _________________, with whom I am personally acquainted (or proved to
me on the basis of satisfactory evidence) and who, upon oath, acknowledged
himself to be _____________________ of Regions Bank, the within named bargainor,
a banking corporation, and that he as such ______________________, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the banking corporation by himself as
WITNESS my hand and seal, this _____ day of May, 2000.
-----------------------------------
NOTARY PUBLIC
My Commission Expires:_____________________
EXHIBIT A
Five (5) luxury motor coaches with vehicle identification numbers as follows:
1996 Prevost Conversion VIN #0XXX0000XX0000000
1996 Eagle 15-45 Conversion VIN #LEUBM6A12TBOO4O86
1995 Eagle 15-45 Conversion VIN #1EUBM6A13SBOO4O63
1996 Eagle 15-45 Conversion VIN #1EUBM6A13TBOO4O81
1997 Eagle 15-45 Conversion VIN #1EUBM6A12VBOO4O91
UNCONDITIONAL AND CONTINUING GUARANTY
THIS UNCONDITIONAL AND CONTINUING GUARANTY ("Guaranty") is executed as of
the 1St day of June, 2000, by Xxxxx Xxxxxxxxx ("Guarantor"), an individual, in
favor of Regions Bank ("Lender"), a banking corporation.
WITNESSETH:
WHEREAS, Lender has agreed to extend credit to Pyramid Coach Inc., a
Tennessee corporation and DW Leasing Company, LLC, a Mississippi limited
liability company (collectively the "Borrower"), on certain terms and
conditions; and
WHEREAS, one condition to Lender's agreement to extend credit to Borrower
is that Guarantor must unconditionally guarantee all present and future
obligations of Borrower to Lender;
NOW, THEREFORE, as an inducement to cause Lender to extend credit to
Borrower, and for other valuable consideration, the receipt and sufficiency of
which are acknowledged, it is agreed as follows:
1. Definition of Obligations. As used herein, the "Obligations" shall mean
all present and future debts and other obligations of Borrower or any successor
thereof to Lender, whether arising by contract, tort, guaranty, overdraft, or
otherwise; whether direct or indirect, absolute or contingent; whether arising
from an original obligation of Borrower; whether such debts or obligations are
from time to time increased, reduced, or entirely extinguished or reincurred;
whether or not the advances or events creating such debts or other obligations
are presently foreseen or are incurred with or without notice to Guarantor; and
regardless of the class of the debts or other obligations, be they otherwise
secured or unsecured.
2. Guaranty of Payment. Guarantor hereby guarantees to Lender the timely
payment and performance of the Obligations.
3. Solvency of Guarantor. Guarantor warrants to Lender that Guarantor is
not insolvent and that Guarantor's execution hereof does not render Guarantor
insolvent for the purpose of State or Federal fraudulent transfer laws or other
avoidance laws.
4. Prospective Cancellation of Guaranty. Guarantor's guarantee of the
Obligations is irrevocable, except that Guarantor may at any time by written
notice to Lender prospectively terminate Guarantor's liability for any advances
made by Lender subsequent to Lender's receipt of the termination notice, except
for any advance that Lender had previously committed to make. After the delivery
of such notice to Lender, Guarantor shall remain fully liable for all principal,
interest and expenses outstanding as of the time of Lender's receipt of the
cancellation hereof; for all interest subsequently accruing thereon and for all
expenses subsequently incurred by Lender with respect thereto; and for all
subsequent principal advances that Lender may have previously committed to make
regardless of whether Lender waived any default or condition precedent in
actually making the advance(s), together with all interest thereon and expenses
related thereto.
5. Guaranty Unconditional. Guarantor's guarantee of the Obligations is
absolute and unconditional. The validity of this Guaranty shall not be impaired
by any event whatsoever, including, but not limited to, the merger,
consolidation, dissolution, cessation of business or liquidation of Borrower;
the financial decline or bankruptcy of Borrower; the failure of any other party
to guarantee the Obligations or to provide collateral therefore; Lender's
compromise or settlement with or without release of Borrower or any other party
liable for the Obligations; Lender's release of any collateral for the
Obligations; Lender's failure to file suit against Borrower (regardless of
whether Borrower is becoming insolvent, if believed to be about to leave the
State or any other circumstance); Lender's failure to give Guarantor notice of
default by Borrower; the unenforceability of the Obligations against Borrower,
due to bankruptcy discharge, counterclaim or for any other reason; Lender's
acceleration of the Obligations at any time; the extension, modification or
renewal of the Obligations; Lender's failure to undertake or exercise diligence
in collection efforts against any party or property; the termination of any
relationship of Guarantor with Borrower, including, but not limited to, any
relationship of employment, ownership, commerce or marriage; Borrower's change
of name or use of any name other than the name used to identify Borrower in this
Guaranty; or Borrower's use of the credit extended for any purpose whatsoever.
Each advance of credit by Lender to Borrower following the execution hereof
shall be deemed made in reliance upon the continued operation of this Guaranty
and shall constitute additional consideration for Guarantor's execution of this
Guaranty. Guarantor agrees that this Guaranty shall be valid and binding upon
Guarantor upon the delivery of this executed Guaranty to Lender by any party
whomsoever.
6. Primary Liability of Guarantor. This Guaranty constitutes a guarantee of
payment and performance and not of collection. Accordingly, Lender may enforce
this Guaranty against Guarantor without first making demand upon or instituting
collection proceedings against Borrower. Guarantor's liability for the
Obligations is hereby declared to be primary, and not secondary, and Guarantor
may be called upon hereunder to make any payment when due under the Obligations.
Each document presently or hereafter executed by Borrower to evidence or secure
an obligation to Lender is incorporated herein by reference and shall be fully
enforceable against Guarantor.
7. Death of Guarantor. In the event of the death of Guarantor, the
obligation of Guarantor shall continue in full force and effect against
Guarantor's estate, and the executor or administrator of such estate shall be
obligated and authorized to pay such debt and otherwise honor this Guaranty,
and, if acceptable to Lender, to execute renewal Guaranties or endorsements or
notes or other evidences of indebtedness, from time to time, with respect to any
unpaid obligations hereunder.
8. Disclosure of Litigation. Guarantor warrants that Guarantor is not
presently a party to any pending litigation, arbitration or administrative
proceeding or the subject of any investigation; that there is not litigation,
arbitration or administrative proceeding or investigation threatened in which
Guarantor will be a party; that Guarantor is not subject to any outstanding
court or administrative order; and that, to the best of Guarantor's knowledge,
information and belief, no facts exist which give rise to claims by third
parties against Guarantor which have not yet been asserted. Guarantor covenants
to give Lender prompt written notice of any litigation, arbitration,
administrative proceeding or investigation that may hereafter be instituted or
threatened in which Guarantor would be a party, whether or not Guarantor's
liability under such proceeding would be covered by insurance.
9. Financial Statements.
a. Warranties. Guarantor warrants that Guarantor's financial
statements delivered to Lender in connection with the Obligations
have been prepared in accordance with generally accepted
accounting principles, consistently applied, and are true,
accurate and complete in every respect. Without limiting the
foregoing, Guarantor warrants that such financial statements
disclose all known contingent liabilities as well as direct
liabilities. Guarantor acknowledges that Lender has relied upon
such financial statements, and Guarantor warrants that no
material adverse change has occurred in the financial condition
reflected in such financial statements. Guarantor warrants that
Guarantor has good and absolute title to the assets disclosed on
Guarantor's balance sheet disclosed to Lender, subject only to
liens, security interests and other encumbrances securing
liabilities listed thereon; and
(b) Reporting Requirements. Guarantor covenants to furnish to Lender,
copies of Guarantor's tax returns and additional financial
statements in form and substance acceptable to Lender both upon
demand and annually without demand, on or before April 30 of each
year. Lender may require that any such financial statements be
audited, at Guarantor's expense, by a certified public accountant
acceptable to Lender. Lender may require that any accountant who
reviews, compiles or certifies such financial statements
expressly acknowledge Lender's reliance thereon.
10. Bankruptcy of Borrower. If proceedings are instituted by Borrower under
any State insolvency law or under any Federal bankruptcy law, or if such
proceedings are instituted against Borrower and are not dismissed within thirty
(30) days, Lender may, at its option, without notice and notwithstanding any
limitation on Lender's ability to use such proceedings as the basis of a default
against Borrower, declare all the Obligations presently due and payable by
Guarantor.
11. No Marshalling of Assets. Lender may proceed against any collateral
securing the Obligations and against parties liable therefor in such order as it
may elect, and Guarantor shall not be entitled to require Lender to marshal
assets. The benefit of any rule of law or equity to the contrary is hereby
expressly waived.
12. Impairment of Collateral; Release of Liable Parties. Lender may, in its
sole discretion and with or without consideration, release any collateral
securing the Obligations or release any party liable therefor. The defenses of
impairment of collateral and impairment of recourse and any requirement of
diligence on Lender's part in collecting the Obligations are hereby waived.
13. Amendment of Obligations. Lender may, without notice to or the joinder
of Guarantor and without affecting Guarantor's liability hereunder, modify,
extend, accelerate, reinstate, refinance, or renew the Obligations (with or
without the execution of new promissory notes) and grant any consent or
indulgence with respect thereto.
14. Waivers of Notice. Guarantor hereby waives any requirement of
presentment, protest, notice of dishonor, notice of default, demand, and all
other actions or notices that may be otherwise required on Lender's part in
connection with the Obligations.
15. Subordination. Guarantor agrees that any existing or future loan made
by Guarantor to Borrower and any other existing or future obligation of Borrower
to Guarantor shall be subordinate to the Obligations as to both payment and
collection. Accordingly, Guarantor agrees not to accept any payment whatsoever
from Borrower (except for reasonable salary and reimbursement of necessary and
reasonable business expenses, unless Lender notifies Guarantor to the contrary)
or to allow any payment by Borrower on Guarantor's behalf until this Guaranty
has been terminated in full. Guarantor hereby grants Lender a security interest
in all obligations now or hereafter owed Guarantor by Borrower and in all
instruments, chattel paper and other property now or hereafter evidencing
obligations of Borrower to Guarantor, together with all collateral therefor.
Guarantor shall advise Lender of the status of such obligations and shall
provide a payment history therefor upon request. Lender may file this Guaranty
(or a copy hereof) as a financing statement with respect thereto, or Lender may
require Guarantor to execute a separate financing statement with respect
thereto, or Lender may require Guarantor to take any other action necessary to
perfect Lender's security interest therein, at Guarantor's expense. Without
limiting the foregoing, all such property owned by Guarantor in which a security
interest may be perfected by possession shall be delivered to Lender immediately
as made available to Guarantor. Guarantor agrees that, in the event of a
bankruptcy or other insolvency proceeding involving Borrower, Guarantor will
timely file a claim for the amount of the subordinated debt, in form approved by
Lender. Guarantor agrees to pursue said claim with diligence and to comply with
any instructions from Lender pertaining to the pursuit of the claim. The
proceeds of any such claim shall be delivered to Lender for application to the
Obligations.
16. Waiver of Rights Against Borrower. Guarantor hereby waives any right of
subrogation to the rights of Lender against Guarantor and agrees to exercise no
right of indemnity, contribution or other right of reimbursement from any party
whatsoever until and unless the Obligations have been satisfied in full.
17. Application of Funds. Lender may apply amounts received for Borrower's
account first to pay any indebtedness of Borrower that is not guaranteed by
Guarantor, if any, before reducing the Obligations.
18. Statute of Limitations. Guarantor acknowledges and agrees that the
statute of limitation applicable to this Guaranty shall begin to run only upon
Lender's accrual of a cause of action against Guarantor hereunder caused by
Guarantor's refusal to honor a demand for performance hereunder made by Lender
in writing; provided, however, if, subsequent to the demand upon Guarantor,
Lender reaches an agreement with Borrower on any terms causing Lender to forbear
in the enforcement of its demand upon Guarantor, the statute of limitation shall
be reinstated for its full duration until Lender subsequently again makes demand
upon Guarantor.
19. Cancellation by Lender. Lender may evidence its cancellation of this
Guaranty and the release of Guarantor from liability hereunder by delivering to
Guarantor an instrument of release, or by delivering this Guaranty to Guarantor,
or both. Unless Lender delivers this original Guaranty to Guarantor with a
notation on its face signed and dated by an authorized officer of Lender stating
"Canceled in Full As To All Obligations", however, the purported cancellation
hereof and release of Guarantor shall not impair Guarantor's continuing
liability for: (i) any amount of principal, interest, or expenses that was
mistakenly omitted by Lender in calculating the final payment due under the
Obligations, if the release of Guarantor was based upon Lender's belief that it
had been paid in full; (ii) any surviving liability of Borrower to reimburse
Lender for expenses or to indemnify Lender provided for in any document executed
prior to the purported cancellation hereof evidencing or securing the
Obligations; and (iii) liability for avoided payments and expenses related
thereto (as provided in detail below). Lender shall not be obligated to release
any collateral securing this Guaranty until after all applicable time periods
have expired regarding bankruptcy preferences or other avoidance actions that
may be applicable to the circumstances of payment of any or all of the
Obligations.
20. Recovery of Avoided Payments. If any amount applied by Lender to the
Obligations is subsequently challenged by k bankruptcy trustee or
debtor-in-possession as an avoidable transfer on the grounds that the payment
constituted a preferential payment or a fraudulent conveyance under State law or
the Bankruptcy Code or any successor statute thereto or on any other grounds,
Lender may, at its option and in its sole discretion, elect whether to contest
such challenge. If Lender contests the avoidance action, all costs of the
proceeding, including Lender's attorneys fees, will become part of the
Obligations. If the contested amount is nevertheless successfully avoided, the
avoided amount will become part of the Obligations hereunder. If Lender elects
not to contest the avoidance action, Lender may tender the amount subject to the
avoidance action to the bankruptcy court, trustee or debtor-in-possession and
the amount so advanced shall become part of the Obligations hereunder
Guarantor's obligation to reimburse Lender for amounts due under this paragraph
shall survive the purported cancellation hereof except as otherwise provided
above.
21. Costs of Collection Against Guarantor. Guarantor agrees to pay all
costs of collection, including, without limitation, court costs, attorney's fees
and compensation for time spent by Lender employees, that Lender may incur in
enforcing the terms of this Guaranty against Guarantor.
22. Changes in Financial Condition. Guarantor covenants to give Lender
prompt written notice of the creation or discovery of any additional contingent
liability or the occurrence of any other material adverse change in the
financial condition of Guarantor.
23. No Unpaid Taxes. Guarantor warrants that Guarantor is not presently
delinquent in the payment of any taxes imposed by any governmental authority or
in the filing of any tax return and that Guarantor is not involved in a dispute
with any taxing authority over tax amounts due. Guarantor covenants that all
future taxes assessed against Guarantor shall be timely paid and that all tax
returns required of Guarantor shall be timely filed.
24. Compliance with Law. Guarantor warrants that Guarantor's business
activities are conducted in accordance with all applicable laws and regulations,
and Guarantor covenants that such activities shall continue to be so conducted.
25. Assistance in Litigation. Guarantor covenants to, upon request,
cooperatively participate in any proceeding in which Guarantor is not an adverse
party to Lender and which concerns Lender's rights regarding the Obligations or
any collateral securing its payment.
26. Security Interest; Setoff. In order to further secure the payment of
the Obligations, Guarantor hereby grants to Lender a security interest and right
of setoff against all of Guarantor's presently owned or hereafter acquired
monies, items, credits, deposits and instruments (including certificates of
deposit) presently or hereafter in the possession of Lender. By maintaining any
such accounts or other property at Lender, Guarantor acknowledges that Guarantor
voluntarily subjects the property to Lender's rights hereunder.
27. Recitals. Grantor warrants and agrees that the recitals set forth at
the beginning of this Guaranty are true.
28. No Burdensome Agreement. Guarantor warrants that Guarantor is not a
party to any contract or agreement and is not subject to any contingent
liability that does or may impair Guarantor's ability to perform under the terms
of this Guaranty. Guarantor further warrants that the execution and performance
of this Guaranty will not cause a default, acceleration or other event of
default under any other contract or agreement to which Guarantor or any property
of Guarantor is subject, and will not .result in ~he imposition of any charge,
penalty, lien or other encumbrance against any of Guarantor's property, except
in favor of Lender.
29. Legal and Binding Agreement. Guarantor warrants that the
execution, delivery and performance of this Guaranty will not violate any
judicial or administrative order or governmental law or regulation, and that
this Guaranty is valid, binding and enforceable in every respect according to
its terms.
30. No Consent Required. Guarantor warrants that Guarantor's execution,
delivery and performance of this Guaranty do not require the consent of or the
giving of notice to any third party including, but not limited to, any other
lender, governmental body or regulatory authority.
31. Consent to Jurisdiction and Venue. Guarantor hereby irrevocably
consents to the jurisdiction of the United States District Court for the Middle
District of Tennessee and of all Tennessee State Courts sitting in Davidson
County, Tennessee, for the purpose of any litigation to which Lender may be a
party and which concerns this Guaranty or the Secured Indebtedness. It is
further agreed that venue for any such action shall lie exclusively with Courts
sitting in Davidson County, Tennessee, unless Lender agrees to the contrary in
writing.
32. Not Partners; No Third Party Beneficiaries. Nothing contained herein or
in any related document shall be deemed to render Lender a partner of Guarantor
for any purpose. This Guaranty has been executed for the sole benefit of Lender,
and no third party is authorized to rely upon Lender's rights hereunder or to
rely upon an assumption that Lender has or will exercise its rights under this
Guaranty or under any document referred to herein.
33. Notices. Any communications concerning this Guaranty or the credit
described herein shall be addressed as follows:
As to Guarantor: Xxxxx Xxxxxxxxx
0000 Xxxxxxxx Xxx Xxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
As to Lender: Regions Bank
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
ATTENTION: Xxxxxxx X. Sparta
With a copy to: Xxx Xxxx & Xxxxxx, PLLC
315 Xxxxxxxxx Street
Suite 0000 XxXxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
ATTENTION: Xxxxx X. Xxxx
Communications shall only be effective when set forth in writing and mailed or
delivered to the receiving party's address stated above. Lender or Guarantor may
change its address for receipt of notices by submitting the change in writing to
the other party.
34. Indulgence Not Waiver. Lender's indulgence in any departure from the
terms of this Guaranty or any other document shall not prejudice Lender's rights
to make demand and recover from Guarantor in accordance with this Guaranty, or
otherwise demand strict compliance with this Guaranty.
35. Cumulative Remedies. The remedies provided Lender in this Guaranty are
not exclusive of any other remedies that may be available to Lender under any
other document or at law or equity.
36. Amendment and Waiver in Writing. No provision of this Guaranty can be
amended or waived, except by a statement in writing signed by the party against
which enforcement of the amendment or waiver is sought.
37. Assignment. This Guaranty shall be binding upon and inure to the
benefit of the respective heirs, successors and assigns of Guarantor and Lender,
except that Guarantor shall not assign any rights or delegate any obligations
arising hereunder without the prior written consent of Lender. Any attempted
assignment or delegation by Guarantor without the required prior consent shall
be void.
38. Severability. Should any provision of this Guaranty be invalid or
unenforceable for any reason, the remaining provisions hereof shall remain in
full effect.
39. Applicable Law. The validity, construction and enforcement of this
Guaranty and all other documents executed with respect to the Obligations shall
be determined according to the laws of Tennessee applicable to contracts, in
which State this Guaranty has been executed and delivered.
40. Gender and Number. Words used herein indicating gender or number shall
be read as context may require.
41. Captions Not Controlling. Captions and headings have been included in
this Guaranty for the convenience of the parties, and shall not be construed as
affecting the content of the respective paragraphs.
42. Notice to Lender Upon Perceived Breach. GUARANTOR AGREES TO GIVE LENDER
WRITTEN NOTICE OF ANY ACTION OR INACTION BY LENDER IN CONNECTION WITH THE
OBLIGATIONS THAT GUARANTOR BELIEVES MAY BE ACTIONABLE AGAINST LENDER OR A
DEJ~ENSE TO PAYMENT FOR ANY REASON, INCLUDING, BUT NOT LIMITED TO, COMMISSION OF
A TORT OR VIOLATION OF ANY CONTRACTUAL DUTY OR DUTY IMPLIED BY LAW. GUARANTOR
AGREES THAT UNLESS SUCH NOTICE IS DULY GIVEN AS PROMPTLY AS POSSIBLE (AND IN ANY
EVENT WITHIN TEN (10) DAYS AFTER GUARANTOR LEARNS OF ANY SUCH ACTION OR
INACTION), GUARANTOR SHALL NOT ASSERT AGAINST LENDER, AND GUARANTOR SHALL BE
DEEMED TO HAVE WAIVED, ANY CLAIM OR DEFENSE ARISING THEREEROM.
43. No Oral Representations Limiting Enforcement. Guarantor acknowledges
Lender's intention to enforce this Guaranty to the fullest extent possible and
Guarantor acknowledges that Lender had made no oral statements to Guarantor that
could be construed as a waiver of Lender's right to enforce this Guaranty by all
available legal means.
EXECUTED the date first written above.
THE UNDERSIGNED ACKNOWLEDGES A THOROUGH UNDERSTANDING OF THE TERMS OF THIS
GUARANTY AND AGREES TO BE BOUND THEREBY.
-----------------------------------------
XXXXX XXXXXXXXX
STATE OF_______________
COUNTY OF _____________
Personally appeared before me, a Notary Public, Xxxxx Xxxxxxxxx, with whom
I am personally acquainted (or proved to me on the basis of satisfactory
evidence), and who acknowledged that she executed the within instrument for the
purposes therein contained.
WITNESS my hand and seal, this ______ day of _______________________,
2000.
-----------------------------------
Notary Public
My Commission Expires:__________________
NOTICE TO GUARANTOR
You are being asked to guarantee all existing and future debts of the
Borrower entered into with this bank. Think carefully before you do. If the
Borrower does not pay the debt, you will have to. Be sure you can afford to pay
if you have to, and that you want to accept this responsibility.
You may have to pay up to the full amount of the debt if the Borrower does
not pay. You may also have to pay late fees or collection costs which increase
this amount.
The bank can collect the Obligations from you without first trying to
collect from the Borrower. The Bank can use the same collection methods against
you that can be used against the Borrower, such as suing you, garnishing your
wages, etc. If this debt is ever in default, that fact may become part of your
credit record.
This notice is not the contract that makes you liable for the debt.
I have read the above notice, understand its contents, and acknowledge
receipt of a copy of this notice this 30th day of May, 2000.
-----------------------------
XXXXX XXXXXXXXX
UNCONDITIONAL AND CONTINUING GUARANTY
THIS UNCONDITIONAL AND CONTINUING GUARANTY ("Guaranty") is executed as of
the 1St day of June, 2000, by Xxxxx X. Xxxxxxxxx ("Guarantor"), an individual,
in favor of Regions Bank ("Lender'), a banking corporation.
WITNESSETH:
WHEREAS, Lender has agreed to extend credit to Pyramid Coach Inc., a
Tennessee corporation and DW Leasing Company, LLC, a Mississippi limited
liability company (collectively the "Borrower"), on certain terms and
conditions; and
WHEREAS, one condition to Lender's agreement to extend credit to Borrower
is that Guarantor must unconditionally guarantee all present and future
obligations of Borrower to Lender;
NOW, THEREFORE, as an inducement to cause Lender to extend credit to
Borrower, and for other valuable consideration, the receipt and sufficiency of
which are acknowledged, it is agreed as follows:
1. Definition of Obligations. As used herein, the "Obligations" shall mean
all present and future debts and other obligations of Borrower or any successor
thereof to Lender, whether arising by contract, tort, guaranty, overdraft, or
otherwise; whether direct or indirect, absolute or contingent; whether arising
from an original obligation of Borrower; whether such debts or obligations are
from time to time increased, reduced, or entirely extinguished or reincurred;
whether or not the advances or events creating such debts or other obligations
are presently foreseen or are incurred with or without notice to Guarantor; and
regardless of the class of the debts or other obligations, be they otherwise
secured or unsecured.
2. Guaranty of Payment. Guarantor hereby guarantees to Lender the timely
payment and performance of the Obligations.
3. Solvency of Guarantor. Guarantor warrants to Lender that Guarantor is
not insolvent and that Guarantor's execution hereof does not render Guarantor
insolvent for the purpose of State or Federal fraudulent transfer laws or other
avoidance laws.
4. Prospective Cancellation of Guaranty. Guarantor's guarantee of the
Obligations is irrevocable, except that Guarantor may at any time by written
notice to Lender prospectively terminate Guarantor's liability for any advances
made by Lender subsequent to Lender's receipt of the termination notice, except
for any advance that Lender had previously committed to make. After the delivery
of such notice to Lender, Guarantor shall remain fully liable for all principal,
interest and expenses outstanding as of the time of Lender's receipt of the
cancellation hereof; for all interest subsequently accruing thereon and for all
expenses subsequently incurred by Lender with respect thereto; and for all
subsequent principal advances that Lender may have previously committed to make
regardless of whether Lender waived any default or condition precedent in
actually making the advance(s), together with all interest thereon and expenses
related thereto.
5. Guaranty Unconditional. Guarantor's guarantee of the Obligations is
absolute and unconditional. The validity of this Guaranty shall not be impaired
by any event whatsoever, including, but not limited to, the merger,
consolidation, dissolution, cessation of business or liquidation of Borrower;
the financial decline or bankruptcy of Borrower; the failure of any other party
to guarantee the Obligations or to provide collateral therefore; Lender's
compromise or settlement with or without release of Borrower or any other party
liable for the Obligations; Lender's release of any collateral for the
Obligations; Lender's failure to file suit against Borrower (regardless of
whether Borrower is becoming insolvent, if believed to be about to leave the
State or any other circumstance); Lender's failure to give Guarantor notice of
default by Borrower; the unenforceability of the Obligations against Borrower,
due to bankruptcy discharge, counterclaim or for any other reason; Lender's
acceleration of the Obligations at any time; the extension, modification or
renewal of the Obligations; Lender's failure to undertake or exercise diligence
in collection efforts against any party or property; the termination of any
relationship of Guarantor with Borrower, including, but not limited to, any
relationship of employment, ownership, commerce or marriage; Borrower's change
of name or use of any name other than the name used to identify Borrower in this
Guaranty; or Borrower's use of the credit extended for any purpose whatsoever.
Each advance of credit by Lender to Borrower following the execution hereof
shall be deemed made in reliance upon the continued operation of this Guaranty
and shall constitute additional consideration for Guarantor's execution of this
Guaranty. Guarantor agrees that this Guaranty shall be valid and binding upon
Guarantor upon the delivery of this executed Guaranty to Lender by any party
whomsoever.
6. Primary Liability of Guarantor. This Guaranty constitutes a guarantee of
payment and performance and not of collection. Accordingly, Lender may enforce
this Guaranty against Guarantor without first making demand upon or instituting
collection proceedings against Borrower. Guarantor's liability for the
Obligations is hereby declared to be primary, and not secondary, and Guarantor
may be called upon hereunder to make any payment when due under the Obligations.
Each document presently or hereafter executed by Borrower to evidence or secure
an obligation to Lender is incorporated herein by reference and shall be fully
enforceable against Guarantor.
7. Death of Guarantor. In the event of the death of Guarantor, the
obligation of Guarantor shall continue in full force and effect against
Guarantor's estate, and the executor or administrator of such estate shall be
obligated and authorized to pay such debt and otherwise honor this Guaranty,
and, if acceptable to Lender, to execute renewal Guaranties or endorsements or
notes or other evidences of indebtedness, from time to time, with respect to any
unpaid obligations hereunder.
8. Disclosure of Litigation. Guarantor warrants that Guarantor is not
presently a party to any pending litigation, arbitration or administrative
proceeding or the subject of any investigation; that there is not litigation,
arbitration or administrative proceeding or investigation threatened in which
Guarantor will be a party; that Guarantor is not subject to any outstanding
court or administrative order; and that, to the best of Guarantor's knowledge,
information and belief, no facts exist which give rise to claims by third
parties against Guarantor which have not yet been asserted. Guarantor covenants
to give Lender prompt written notice of any litigation, arbitration,
administrative proceeding or investigation that may hereafter be instituted or
threatened in which Guarantor would be a party, whether or not Guarantor's
liability under such proceeding would be covered by insurance.
9. Financial Statements.
(a) Warranties. Guarantor warrants that Guarantor's financial
statements delivered to Lender in connection with the Obligations
have been prepared in accordance with generally accepted
accounting principles, consistently applied, and are true,
accurate and complete in every respect. Without limiting the
foregoing, Guarantor warrants that such financial statements
disclose all known contingent liabilities as well as direct
liabilities. Guarantor acknowledges that Lender has relied upon
such financial statements, and Guarantor warrants that no
material adverse change has occurred in the financial condition
reflected in such financial statements. Guarantor warrants that
Guarantor has good and absolute title to the assets disclosed on
Guarantor's balance sheet disclosed to Lender, subject only to
liens, security interests and other encumbrances securing
liabilities listed thereon; and
(b) Reporting Requirements. Guarantor covenants to furnish to Lender,
copies of Guarantor's tax returns and additional financial
statements in form and substance acceptable to Lender both upon
demand and annually without demand, on or before April 30 of each
year. Lender may require that any such financial statements be
audited, at Guarantor's expense, by a certified public accountant
acceptable to Lender. Lender may require that any accountant who
reviews, compiles or certifies such financial statements
expressly acknowledge Lender's reliance thereon.
10. Bankruptcy of Borrower. If proceedings are instituted by Borrower under
any State insolvency law or under any Federal bankruptcy law, or if such
proceedings are instituted against Borrower and are not dismissed within thirty
(30) days, Lender may, at its option, without notice and notwithstanding any
limitation on Lender's ability to use such proceedings as the basis of a default
against Borrower, declare all the Obligations presently due and payable by
Guarantor.
11. No Marshalling of Assets. Lender may proceed against any collateral
securing the Obligations and against parties liable therefor in such order as it
may elect, and Guarantor shall not be entitled to require Lender to marshal
assets. The benefit of any rule of law or equity to the contrary is hereby
expressly waived.
12. Impairment of Collateral; Release of Liable Parties. Lender may, in its
sole discretion and with or without consideration, release any collateral
securing the Obligations or release any party liable therefor. The defenses of
impairment of collateral and impairment of recourse and any requirement of
diligence on Lender's part in collecting the Obligations are hereby waived.
13. Amendment of Obligations. Lender may, without notice to or the joinder
of Guarantor and without affecting Guarantor's liability hereunder, modify,
extend, accelerate, reinstate, refinance, or renew the Obligations (with or
without the execution of new promissory notes) and grant any consent or
indulgence with respect thereto.
14. Waivers of Notice. Guarantor hereby waives any requirement of
presentment, protest, notice of dishonor, notice of default, demand, and all
other actions or notices that may be otherwise required on Lender's part in
connection with the Obligations.
15. Subordination. Guarantor agrees that any existing or future loan made
by Guarantor to Borrower and any other existing or future obligation of Borrower
to Guarantor shall be subordinate to the Obligations as to both payment and
collection. Accordingly, Guarantor agrees not to accept any payment whatsoever
from Borrower (except for reasonable salary and reimbursement of necessary and
reasonable business expenses, unless Lender notifies Guarantor to the contrary)
or to allow any payment by Borrower on Guarantor's behalf until this Guaranty
has been terminated in full. Guarantor hereby grants Lender a security interest
in all obligations now or hereafter owed Guarantor by Borrower and in all
instruments, chattel paper and .other property now or hereafter evidencing
obligations of Borrower to Guarantor, together with all collateral therefor.
Guarantor shall advise Lender of the status of such obligations and shall
provide a payment history therefor upon request. Lender may file this Guaranty
(or a copy hereof) as a financing statement with respect thereto, or Lender may
require Guarantor to execute a separate financing statement with respect
thereto, or Lender may require Guarantor to take any other action necessary to
perfect Lender's security interest therein, at Guarantor's expense. Without
limiting the foregoing, all such property owned by Guarantor in which a security
interest may be perfected by possession shall be delivered to Lender immediately
as made available to Guarantor. Guarantor agrees that, in the event of a
bankruptcy or other insolvency proceeding involving Borrower, Guarantor will
timely file a claim for the amount of the subordinated debt, in form approved by
Lender. Guarantor agrees to pursue said claim with diligence and to comply with
any instructions from Lender pertaining to the pursuit of the claim. The
proceeds of any such claim shall be delivered to Lender for application to the
Obligations.
16. Waiver of Rights Against Borrower. Guarantor hereby waives any right of
subrogation to the rights of Lender against Guarantor and agrees to exercise no
right of indemnity, contribution or other right of reimbursement from any party
whatsoever until and unless the Obligations have been satisfied in full.
17. Application of Funds. Lender may apply amounts received for Borrower's
account first to pay any indebtedness of Borrower that is not guaranteed by
Guarantor, if any, before reducing the Obligations.
18. Statute of Limitations. Guarantor acknowledges and agrees that the
statute of limitation applicable to this Guaranty shall begin to run only upon
Lender's accrual of a cause of action against Guarantor hereunder caused by
Guarantor's refusal to honor a demand for performance hereunder made by Lender
in writing; provided, however, if, subsequent to the demand upon Guarantor,
Lender reaches an agreement with Borrower on any terms causing Lender to forbear
in the enforcement of its demand upon Guarantor, the statute of limitation,
shall be reinstated for its full duration until Lender subsequently again makes
demand upon Guarantor.
19. Cancellation by Lender. Lender may evidence its cancellation of this
Guaranty and the release of Guarantor from liability hereunder by delivering to
Guarantor an instrument of release, or by delivering this Guaranty to Guarantor,
or both. Unless Lender delivers this original Guaranty to Guarantor with a
notation on its face signed and dated by an authorized officer of Lender stating
"Canceled in Full As To All Obligations", however, the purported cancellation
hereof and release of Guarantor shall not impair Guarantor's continuing
liability for: (i) any amount of principal, interest, or expenses that was
mistakenly omitted by Lender in calculating the final payment due under the
Obligations, if the release of Guarantor was based upon Lender's belief that it
had been paid in full; (ii) any surviving liability of Borrower to reimburse
Lender for expenses or to indemnify Lender provided for in any document executed
prior to the purported cancellation hereof evidencing or securing the
Obligations; and (iii) liability for avoided payments and expenses related
thereto (as provided in detail below). Lender shall not be obligated to release
any collateral securing this Guaranty until after all applicable time periods
have expired regarding bankruptcy preferences or other avoidance actions that
may be applicable to the circumstances of payment of any or all of the
Obligations.
20. Recovery of Avoided Payments. If any amount applied by Lender to the
Obligations is subsequently challenged by a bankruptcy trustee or
debtor-in-possession as an avoidable transfer on the grounds that the payment
constituted a preferential payment or a fraudulent conveyance under State law or
the Bankruptcy Code or any successor statute thereto or on any other grounds,
Lender may, at its option and in its sole discretion, elect whether to contest
such challenge. If Lender contests the avoidance action, all costs of the
proceeding, including Lender's attorneys fees, will become part of the
Obligations. If the contested amount is nevertheless successfully avoided, the
avoided amount will become part of the Obligations hereunder. If Lender elects
not to contest the avoidance action, Lender may tender the amount subject to the
avoidance action to the bankruptcy court, trustee or debtor-in-possession and
the amount so advanced shall become part of the Obligations hereunder.
Guarantor's obligation to reimburse Lender for amounts due under this paragraph
shall survive the purported cancellation hereof except as otherwise provided
above.
21. Costs of Collection Against Guarantor. Guarantor agrees to pay all
costs of collection, including, without limitation, court costs, attorney's fees
and compensation for time spent by Lender employees, that Lender may incur in
enforcing the terms of this Guaranty against Guarantor.
22. Changes in Financial Condition. Guarantor covenants to give Lender
prompt written notice of the creation or discovery of any additional contingent
liability or the occurrence of any other material adverse change in the
financial condition of Guarantor.
23. No Unpaid Taxes. Guarantor warrants that Guarantor is not presently
delinquent in the payment of any taxes imposed by any governmental authority or
in the filing of any tax return and that Guarantor is not involved in a dispute
with any taxing authority over tax amounts due. Guarantor covenants that all
future taxes assessed against Guarantor shall be timely paid and that all tax
returns required of Guarantor shall be timely filed.
24. Compliance with Law. Guarantor warrants that Guarantor's business
activities are conducted in accordance with all applicable laws and regulations,
and Guarantor covenants that such activities shall continue to be so conducted.
25. Assistance in Litigation. Guarantor covenants to, upon request,
cooperatively participate in any proceeding in which Guarantor is not an adverse
party to Lender and which concerns Lender's rights regarding the Obligations or
any collateral securing its payment.
26. Security Interest; Setoff. In order to further secure the payment of
the Obligations, Guarantor hereby grants to Lender a security interest and right
of setoff against all of Guarantor's presently owned or hereafter acquired
monies, items, credits, deposits and instruments (including certificates of
deposit) presently or hereafter in the possession of Lender. By maintaining any
such accounts or other property at Lender, Guarantor acknowledges that Guarantor
voluntarily subjects the property to Lender's rights hereunder.
27. Recitals. Grantor warrants and agrees that the recitals set forth at
the beginning of this Guaranty are true.
28. No Burdensome Agreement. Guarantor warrants that Guarantor is not a
party to any contract or agreement and is not subject to any contingent
liability that does or may impair Guarantor's ability to perform under the terms
of this Guaranty. Guarantor further warrants that the execution and performance
of this Guaranty will not cause a default, acceleration or other event of
default under any other contract or agreement to which Guarantor or any property
of Guarantor is subject, and will not result in the imposition of any charge,
penalty, lien or other encumbrance against any of Guarantor's property, except
in favor of Lender.
29. Legal and Binding Agreement. Guarantor warrants that the execution,
delivery and performance of this Guaranty will not violate any judicial or
administrative order or governmental law or regulation, and that this Guaranty
is valid, binding and enforceable in every respect according to its terms.
30. No Consent Required. Guarantor warrants that Guarantor's execution,
delivery and performance of this Guaranty do not require the consent of or the
giving of notice to any third party including, but not limited to, any other
lender, governmental body or regulatory authority.
31. Consent to Jurisdiction and Venue. Guarantor hereby irrevocably
consents to the jurisdiction of the United States District Court for the Middle
District of Tennessee and of all Tennessee State Courts sitting in Davidson
County, Tennessee, for the purpose of any litigation to which Lender may be a
party and which concerns this Guaranty or the Secured Indebtedness. It is
further agreed that venue for any such action shall lie exclusively with Courts
sitting in Davidson County, Tennessee, unless Lender agrees to the contrary in
writing.
32. Not Partners; No Third Party Beneficiaries. Nothing contained herein or
in any related document shall be deemed to render Lender a partner of Guarantor
for any purpose. This Guaranty has been executed for the sole benefit of Lender,
and no third party is authorized to rely upon Lender's rights hereunder or to
rely upon an assumption that Lender has or will exercise its rights under this
Guaranty or under any document referred to herein.
33. Notices. Any communications concerning this Guaranty or the credit
described herein shall be addressed as follows:
As to Guarantor: Xxxxx X. Xxxxxxxxx
0000 Xxxxxxxx Xxx Xxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
As to Lender: Regions Bank
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
ATTENTION: Xxxxxxx X. Sparta
With a copy to: Xxx Xxxx & Xxxxxx, PLLC
315 Xxxxxxxxx Street
Suite 0000 XxXxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
ATTENTION: Xxxxx X. Xxxx
Communications shall only be effective when set forth in writing and mailed or
delivered to the receiving party's address stated above. Lender or Guarantor may
change its address for receipt of notices by submitting the change in writing to
the other party.
34. Indulgence Not Waiver. Lender's indulgence in any departure from the
terms of this Guaranty or any other document shall not prejudice Lender's rights
to make demand and recover from Guarantor in accordance with this Guaranty, or
otherwise demand strict compliance with this Guaranty.
35. Cumulative Remedies. The remedies provided Lender in this Guaranty are
not exclusive of any other remedies that may be available to Lender under any
other document or at law or equity.
36. Amendment and Waiver in Writing. No provision of this Guaranty can be
amended or waived, except by a statement in writing signed by the party against
which enforcement of the amendment or waiver is sought.
37. Assignment. This Guaranty shall be binding upon and inure to the
benefit of the respective heirs, successors and assigns of Guarantor and Lender,
except that Guarantor shall not assign any rights or delegate any obligations
arising hereunder without the prior written consent of Lender. Any attempted
assignment or delegation by Guarantor without the required prior consent shall
be void.
38. Severability. Should any provision of this Guaranty be invalid or
unenforceable for any reason, the remaining provisions hereof shall remain in
full effect.
39. Applicable Law. The validity, construction and enforcement of this
Guaranty and all other documents executed with respect to the Obligations shall
be determined according to the laws of Tennessee applicable to contracts, in
which State this Guaranty has been executed and delivered.
40. Gender and Number. Words used herein indicating gender or number shall
be read as context may require.
41. Captions Not Controlling Captions and headings have been included in
this Guaranty for the convenience of the parties, and shall not be construed as
affecting the content of the respective paragraphs.
42. Notice to Lender Upon Perceived Breach. GUARANTOR AGREES TO GIVE LENDER
WRITTEN NOTICE OF ANY ACTION OR INACTION BY LENDER IN CONNECTION WITH TILE
OBLIGATIONS THAT GUARANTOR BELIEVES MAY BE ACTIONABLE AGAINST LENDER OR A
DEFENSE TO PAYMENT FOR ANY REASON, INCLUDING, 13UT NOT LIMITED TO, COMMISSION OF
A TORT OR VIOLATION OF ANY CONTRACTUAL DUTY OR DUTY IMPLIED BY LAW. GUARANTOR
AGREES THAT UNLESS SUCH NOTICE IS DULY GIVEN AS PROMPTLY AS POSSIBLE (AND IN ANY
EVENT WITHIN TEN (10) DAYS AFTER GUARANTOR LEARNS OF ANY SUCH ACTION OR
INACTION), GUARANTOR SHALL NOT ASSERT AGAINST LENDER, AND GUARANTOR SHALL BE
DEEMED TO HAVE WAIVED, ANY CLAIM OR DEFENSE ARISING THEREFROM.
43. No Oral Representations Limiting Enforcement. Guarantor acknowledges
Lender's intention to enforce this Guaranty to the fullest extent possible and
Guarantor acknowledges that Lender had made no oral statements to Guarantor that
could be construed as a waiver of Lender's right to enforce this Guaranty by all
available legal means.
EXECUTED the date first written above.
THE UNDERSIGNED ACKNOWLEDGES A THOROUGH UNDERSTANDING OF TILE TERMS OF THIS
GUARANTY AND AGREES TO BE BOUND THEREBY.
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XXXXX X. XXXXXXXXX
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WITNESS
NOTICE TO GUARANTOR
You are being asked to guarantee all existing and future debts of the
Borrower entered into with this bank. Think carefully before you do. If the
Borrower does not pay the debt, you will have to. Be sure you can afford to pay
if you have to, and that you want to accept this responsibility.
You may have to pay up to the full amount of the debt if the Borrower does
not pay. You may also have to pay late fees or collection costs which increase
this amount.
The bank can collect the Obligations from you without first trying to
collect from the Borrower. The Bank can use the same collection methods against
you that can be used against the Borrower, such as suing you, garnishing your
wages, etc. If this debt is ever in default, that fact may become part of your
credit record.
This notice is not the contract that makes you liable for the debt.
I have read the above notice, understand its contents, and acknowledge
receipt of a copy of this notice this 30th day of May, 2000. 1
--------------------------
XXXXX X. XXXXXXXXX
UNCONDITIONAL AND CONTINUING GUARANTY
THIS UNCONDITIONAL AND CONTINUING GUARANTY ("Guaranty") is executed as of
the 1St day of June, 2000, by Xxxxxxx X. Xxxxxx ("Guarantor"), an individual, in
favor of Regions Bank ("Lender'), a banking corporation.
WITNESSETH:
WHEREAS, Lender has agreed to extend credit to Pyramid Coach Inc., a
Tennessee corporation and DW Leasing Company, LLC, a Mississippi limited
liability company (collectively the "Borrower"), on certain terms and
conditions; and
WHEREAS, one condition to Lender's agreement to extend credit to Borrower
is that Guarantor must unconditionally guarantee all present and future
obligations of Borrower to Lender;
NOW, THEREFORE, as an inducement to cause Lender to extend credit to
Borrower, and for other valuable consideration, the receipt and sufficiency of
which are acknowledged, it is agreed as follows:
1. Definition of Obligations. As used herein, the "Obligations" shall mean
all present and future debts and other obligations of Borrower or any successor
thereof to Lender, whether arising by contract, tort, guaranty, overdraft, or
otherwise; whether direct or indirect, absolute or contingent; whether arising
from an original obligation of Borrower; whether such debts or obligations are
from time to time increased, reduced, or entirely extinguished or reincurred;
whether or not the advances or events creating such debts or other obligations
are presently foreseen or are incurred with or without notice to Guarantor; and
regardless of the class of the debts or other obligations, be they otherwise
secured or unsecured.
2. Guaranty of Payment. Guarantor hereby guarantees to Lender the timely
payment and performance of the Obligations.
3. Solvency of Guarantor. Guarantor warrants to Lender that Guarantor is
not insolvent and that Guarantor's execution hereof does not render Guarantor
insolvent for the purpose of State or Federal fraudulent transfer laws or other
avoidance laws.
4. Prospective Cancellation of Guaranty. Guarantor's guarantee of the
Obligations is irrevocable, except that Guarantor may at any time by written
notice to Lender prospectively terminate Guarantor's liability for any advances
made by Lender subsequent to Lender's receipt of the termination notice, except
for any advance that Lender had previously committed to make. After the delivery
of such notice to Lender, Guarantor shall remain fully liable for all principal,
interest and expenses outstanding as of the time of Lender's receipt of the
cancellation hereof; for all interest subsequently accruing thereon and for all
expenses subsequently incurred by Lender with respect thereto; and for all
subsequent principal advances that Lender may have previously committed to make
regardless of whether Lender waived any default or condition precedent in
actually making the advance(s), together with all interest thereon and expenses
related thereto.
5. Guaranty Unconditional. Guarantor's guarantee of the Obligations is
absolute and unconditional. The validity of this Guaranty shall not be impaired
by any event whatsoever, including, but not limited to, the merger,
consolidation, dissolution, cessation of business or liquidation of Borrower;
the financial decline or bankruptcy of Borrower; the failure of any other party
to guarantee the Obligations or to provide collateral therefore; Lender's
compromise or settlement with or without release of Borrower or any other party
liable for the Obligations; Lender's release of any collateral for the
Obligations; Lender's failure to file suit against Borrower (regardless of
whether Borrower is becoming insolvent, if believed to be about to leave the
State or any other circumstance); Lender's failure to give Guarantor notice of
default by Borrower; the unenforceability of the Obligations against Borrower,
due to bankruptcy discharge, counterclaim or for any other reason; Lender's
acceleration of the Obligations at any time; the extension, modification or
renewal of the Obligations; Lender's failure to undertake or exercise diligence
in collection efforts against any party or property; the termination of any
relationship of Guarantor with Borrower, including, but not limited to, any
relationship of employment, ownership, commerce or marriage; Borrower's change
of name or use of any name other than the name used to identify Borrower in this
Guaranty; or Borrower's use of the credit extended for any purpose whatsoever.
Each advance of credit by Lender to Borrower following the execution hereof
shall be deemed made in reliance upon the continued operation of this Guaranty
and shall constitute additional consideration for Guarantor's execution of this
Guaranty. Guarantor agrees that this Guaranty shall be valid and binding upon
Guarantor upon the delivery of this executed Guaranty to Lender by any party
whomsoever.
6. Primary Liability of Guarantor. This Guaranty constitutes a guarantee of
payment and performance and not of collection. Accordingly, Lender may enforce
this Guaranty against Guarantor without first making demand upon or instituting
collection proceedings against Borrower. Guarantor's liability for the
Obligations is hereby declared to be primary, and not secondary, and Guarantor
may be called upon hereunder to make any payment when due under the Obligations.
Each document presently or hereafter executed by Borrower to evidence or secure
an obligation to Lender is incorporated herein by reference and shall be fully
enforceable against Guarantor.
7. Death of Guarantor. In the event of the death of Guarantor, the
obligation of Guarantor shall continue in full force and effect against
Guarantor's estate, and the executor or administrator of such estate shall be
obligated and authorized to pay such debt and otherwise honor this Guaranty,
and, if acceptable to Lender, to execute renewal Guaranties or endorsements or
notes or other evidences of indebtedness, from time to time, with respect to any
unpaid obligations hereunder.
8. Disclosure of Litigation. Guarantor warrants that Guarantor is not
presently a party to any pending litigation, arbitration or administrative
proceeding or the subject of any investigation; that there is not litigation,
arbitration or administrative proceeding or investigation threatened in which
Guarantor will be a party; that Guarantor is not subject to any outstanding
court or administrative order; and that, to the best of Guarantor's knowledge,
information and belief, no facts exist which give rise to claims by third
parties against Guarantor which have not yet been asserted. Guarantor covenants
to give Lender prompt written notice of any litigation, arbitration,
administrative proceeding or investigation that may hereafter be instituted or
threatened in which Guarantor would be a party, whether or not Guarantor's
liability under such proceeding would be covered by insurance.
9. Financial Statements.
(a) Warranties. Guarantor warrants that Guarantor's financial
statements delivered to Lender in connection with the Obligations
have been prepared in accordance with generally accepted
accounting principles, consistently applied, and are true,
accurate and complete in every respect. Without limiting the
foregoing, Guarantor warrants that such financial statements
disclose all known contingent liabilities as well as direct
liabilities. Guarantor acknowledges that Lender has relied upon
such financial statements, and Guarantor warrants that no
material adverse change has occurred in the financial condition
reflected in such financial statements. Guarantor warrants that
Guarantor has good and absolute title to the assets disclosed on
Guarantor's balance sheet disclosed to Lender, subject only to
liens, security interests and other encumbrances securing
liabilities listed thereon; and
(b) Reporting Requirements. Guarantor covenants to furnish to Lender,
copies of Guarantor's tax returns and additional financial
statements in form and substance acceptable to Lender both upon
demand and annually without demand, on or before April 30 of each
year. Lender may require that any such financial statements be
audited, at Guarantor's expense, by a certified public accountant
acceptable to Lender. Lender may require that any accountant who
reviews, compiles or certifies such financial statements
expressly acknowledge Lender's reliance thereon.
10. Bankruptcy of Borrower. If proceedings are instituted by Borrower under
any State insolvency law or under any Federal bankruptcy law, or if such
proceedings are instituted against Borrower and are not dismissed within thirty
(30) days, Lender may, at its option, without notice and notwithstanding any
limitation on Lender's ability to use such proceedings as the basis of a default
against Borrower, declare all the Obligations presently due and payable by
Guarantor.
11. No Marshalling of Assets. Lender may proceed against any collateral
securing the Obligations and against parties liable therefor in such order as it
may elect, and Guarantor shall not be entitled to require Lender to marshal
assets. The benefit of any rule of law or equity to the contrary is hereby
expressly waived.
12. Impairment of Collateral; Release of Liable Parties. Lender may, in its
sole discretion and with or without consideration, release any collateral
securing the Obligations or release any party liable therefor. The defenses of
impairment of collateral and impairment of recourse and any requirement of
diligence on Lender's part in collecting the Obligations are hereby waived.
13. Amendment of Obligations. Lender may, without notice to or the joinder
of Guarantor and without affecting Guarantor's liability hereunder, modify,
extend, accelerate, reinstate, refinance, or renew the Obligations (with or
without the execution of new promissory notes) and grant any consent or
indulgence with respect thereto.
14. Waivers of Notice. Guarantor hereby waives any requirement of
presentment, protest, notice of dishonor, notice of default, demand, and all
other actions or notices that may be otherwise required on Lender's part in
connection with the Obligations.
15. Subordination. Guarantor agrees that any existing or future loan
made by Guarantor to Borrower and any other existing or future obligation of
Borrower to Guarantor shall be subordinate to the Obligations as to both
payment
and collection. Accordingly, Guarantor agrees not to accept any payment
whatsoever from Borrower (except for reasonable salary and reimbursement of
necessary and reasonable business expenses, unless Lender notifies Guarantor to
the contrary) or to allow any payment by Borrower on Guarantor's behalf until
this Guaranty has been terminated in full. Guarantor hereby grants Lender a
security interest in all obligations now or hereafter owed Guarantor by Borrower
and in all instruments, chattel paper and other property now or hereafter
evidencing obligations of Borrower to Guarantor, together with all collateral
therefor. Guarantor shall advise Lender of the status of such obligations and
shall provide a payment history therefor upon request. Lender may file this
Guaranty (or a copy hereof) as a financing statement with respect thereto, or
Lender may require Guarantor to execute a separate financing statement with
respect thereto, or Lender may require Guarantor to take any other action
necessary to perfect Lender's security interest therein, at Guarantor's expense.
Without limiting the foregoing, all such property owned by Guarantor in which a
security interest may be perfected by possession shall be delivered to Lender
immediately as made available to Guarantor. Guarantor agrees that, in the event
of a bankruptcy or other insolvency proceeding involving Borrower, Guarantor
will timely file a claim for the amount of the subordinated debt, in form
approved by Lender. Guarantor agrees to pursue said claim with diligence and to
comply with any instructions from Lender pertaining to the pursuit of the claim.
The proceeds of any such claim shall be delivered to Lender for application to
the Obligations.
16. Waiver of Rights Against Borrower. Guarantor hereby waives any right of
subrogation to the rights of Lender against Guarantor and agrees to exercise no
right of indemnity, contribution or other right of reimbursement from any party
whatsoever until and unless the Obligations have been satisfied in full.
17. Application of Funds. Lender may apply amounts received for Borrower's
account first to pay any indebtedness of Borrower that is not guaranteed by
Guarantor, if any, before reducing the Obligations.
18. Statute of Limitations. Guarantor acknowledges and agrees that the
statute of limitation applicable to this Guaranty shall begin to run only upon
Lender's accrual of a cause of action against Guarantor hereunder caused by
Guarantor's refusal to honor a demand for performance hereunder made by Lender
in writing; provided, however, if, subsequent to the demand upon Guarantor,
Lender reaches an agreement with Borrower on any terms causing Lender to forbear
in the enforcement of its demand upon Guarantor, the statute of limitation shall
be reinstated for its full duration until Lender subsequently again makes demand
upon Guarantor.
19. Cancellation by Lender. Lender may evidence its cancellation of this
Guaranty and the release of Guarantor from liability hereunder by delivering to
Guarantor an instrument of release, or by delivering this Guaranty to Guarantor,
or both. Unless Lender delivers this original Guaranty to Guarantor with a
notation on its face signed and dated by an authorized officer of Lender stating
"Canceled in Full As To All Obligations", however, the purported cancellation
hereof and release of Guarantor shall not impair Guarantor's continuing
liability for: (i) any amount of principal, interest, or expenses that was
mistakenly omitted b9 Lender in calculating the final payment due under the
Obligations, if the release of Guarantor was based upon Lender's belief that it
had been paid in full; (ii) any surviving liability of Borrower to reimburse
Lender for expenses or to indemnify Lender provided for in any document executed
prior to the purported cancellation hereof evidencing or securing the
Obligations; and (iii) liability for avoided payments and expenses related
thereto (as provided in detail below). Lender shall not be obligated to release
any collateral securing this Guaranty until after all applicable time periods
have expired regarding bankruptcy preferences or other avoidance actions that
may be applicable to the circumstances of payment of any or all of the
Obligations.
20. Recovery of Avoided Payments. If any amount applied by Lender to the
Obligations is subsequently challenged by a bankruptcy trustee or
debtor-in-possession as an avoidable transfer on the grounds that the payment
constituted a preferential payment or a fraudulent conveyance under State law or
the Bankruptcy Code or any successor statute thereto or on any other grounds,
Lender may, at its option and in its sole discretion, elect whether to contest
such challenge. If Lender contests the avoidance action, all costs of the
proceeding, including Lender's attorneys fees, will become part of the
Obligations. If the contested amount is nevertheless successfully avoided, the
avoided amount will become part of the Obligations hereunder. If Lender elects
not to contest the avoidance action, Lender may tender the amount subject to the
avoidance action to the bankruptcy court, trustee or debtor-in-possession and
the amount so advanced shall become part of the Obligations hereunder.
Guarantor's obligation to reimburse Lender for amounts due under this paragraph
shall survive the purported cancellation hereof except as otherwise provided
above.
21. Costs of Collection Against Guarantor. Guarantor agrees to pay all
costs of collection, including, without limitation, court costs, attorney's fees
and compensation for time spent by Lender employees, that Lender may incur in
enforcing the terms of this Guaranty against Guarantor.
22. Changes in Financial Condition. Guarantor covenants to give Lender
prompt written notice of the creation or discovery of any additional contingent
liability or the occurrence of any other material adverse change in the
financial condition of Guarantor.
23. No Unpaid Taxes. Guarantor warrants that Guarantor is not presently
delinquent in the payment of any taxes imposed by any governmental authority or
in the filing of any tax return and that Guarantor is not involved in a dispute
with any taxing authority over tax amounts due. Guarantor covenants that all
future taxes assessed against Guarantor shall be timely paid and that all tax
returns required of Guarantor shall be timely filed.
24. Compliance with Law. Guarantor warrants that Guarantor's business
activities are conducted in accordance with all applicable laws and regulations,
and Guarantor covenants that such activities shall continue to be so conducted.
25. Assistance in Litigation. Guarantor covenants to, upon request,
cooperatively participate in any proceeding in which Guarantor is not an adverse
party to Lender and which concerns Lender's rights regarding the Obligations or
any collateral securing its payment.
26. Security Interest; Setoff. In order to further secure the payment of
the Obligations, Guarantor hereby grants to Lender a security interest and right
of setoff against all of Guarantor's presently owned or hereafter acquired
monies, items, credits, deposits and instruments (including certificates of
deposit) presently or hereafter in the possession of Lender. By maintaining any
such accounts or other property at Lender, Guarantor acknowledges that Guarantor
voluntarily subjects the property to Lender's rights hereunder.
27. Recitals. Grantor warrants and agrees that the recitals set forth at
the beginning of this Guaranty are true.
28. No Burdensome Agreement. Guarantor warrants that Guarantor is not a
party to any contract or agreement and is not subject to any contingent
liability that does or may impair Guarantor's ability to perform under the terms
of this Guaranty. Guarantor further warrants that the execution and performance
of this Guaranty will not cause a default, acceleration or other event of
default under any other contract or agreement to which Guarantor or any property
of Guarantor is subject, and will not result in the imposition of any charge,
penalty, lien or other encumbrance against any of Guarantor's property, except
in favor of Lender.
29. Legal and Binding Agreement. Guarantor warrants that the execution,
delivery and performance of this Guaranty will not violate any judicial or
administrative order or governmental law or regulation, and that this Guaranty
is valid, binding and enforceable in every respect according to its terms.
30. No Consent Required. Guarantor warrants that Guarantor's execution,
delivery and performance of this Guaranty do not require the consent of or the
giving of notice to any third party including, but not limited to, any other
lender, governmental body or regulatory authority.
31. Consent to Jurisdiction and Venue. Guarantor hereby irrevocably
consents to the jurisdiction of the United States District Court for the Middle
District of Tennessee and of all Tennessee State Courts sitting in Davidson
County, Tennessee, for the purpose of any litigation to which Lender may be a
party and which concerns this Guaranty or the Secured Indebtedness. It is
further agreed that venue for any such action shall lie exclusively with Courts
sitting in Davidson County, Tennessee, unless Lender agrees to the contrary in
writing.
32. Not Partners; No Third Party Beneficiaries. Nothing contained herein or
in any related document shall be deemed to render Lender a partner of Guarantor
for any purpose. This Guaranty has been executed for the sole benefit of Lender,
and no third party is authorized to rely upon Lender's rights hereunder or to
rely upon an assumption that Lender `has or will exercise its rights under this
Guaranty or under any document referred to herein.
33. Notices. Any communications concerning this Guaranty or the credit
described herein shall be addressed as follows: As to Guarantor: Xxxxxxx X.
Xxxxxx 0000 Xxxxxxx Xxxxxx Xxxxx Xxxxxxxxxxxx, Xxxxxxx 00000
As to Lender: Regions Bank
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
ATTENTION: Xxxxxxx X. Sparta
With a copy to: Xxx Xxxx & Xxxxxx, PLLC
315 Xxxxxxxxx Street
Suite 0000 XxXxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
ATTENTION: Xxxxx X. Xxxx
Communications shall only be effective when set forth in writing and mailed or
delivered to the receiving party's address stated above. Lender or Guarantor may
change its address for receipt of notices by submitting the change in writing to
the other party.
34. Indulgence Not Waiver. Lender's indulgence in any departure from the
terms of this Guaranty or any other document shall not prejudice Lender's rights
to make demand and recover from Guarantor in accordance with this Guaranty, or
otherwise demand strict compliance with this Guaranty.
35. Cumulative Remedies. The remedies provided Lender in this Guaranty are
not exclusive of any other remedies that may be available to Lender under any
other document or at law or equity.
36. Amendment and Waiver in Writing. No provision of this Guaranty can be
amended or waived, except by a statement in writing signed by the party against
which enforcement of the amendment or waiver is sought.
37. Assignment. This Guaranty shall be binding upon and inure to the
benefit of the respective heirs, successors and assigns of Guarantor and Lender,
except that Guarantor shall not assign any rights or delegate any obligations
arising hereunder without the prior written consent of Lender. Any attempted
assignment or delegation by Guarantor without the required prior consent shall
be void.
38. Severability. Should any provision of this Guaranty be invalid or
unenforceable for any reason, the remaining provisions hereof shall remain in
full effect.
39. Applicable Law. The validity, construction and enforcement of this
Guaranty and all other documents executed with respect to the Obligations shall
be determined according to the laws of Tennessee applicable to contracts, in
which State this Guaranty has been executed and delivered.
40. Gender and Number. Words used herein indicating gender or number shall
be read as context may require.
41. Captions Not Controlling Captions and headings have been included in
this Guaranty for the convenience of the parties, and shall not be construed as
affecting the content of the respective paragraphs.
42. Notice to Lender Upon Perceived Breach. GUARANTOR AGREES TO GIVE LENDER
WRITTEN NOTICE OF ANY ACTION OR INACTION BY LENDER IN CONNECTION WITH THE
OBLIGATIONS THAT GUARANTOR BELIEVES MAY BE ACTIONABLE AGAINST LENDER OR A
DEFENSE TO PAYMENT FOR ANY REASON, INCLUDING, BUT NOT LIMITED TO, COMMISSION OF
A TORT OR VIOLATION OF ANY CONTRACTUAL DUTY OR DUTY IMPLIED BY LAW. GUARANTOR
AGREES THAT UNLESS SUCH NOTICE IS DULY GIVEN AS PROMPTLY AS POSSIBLE (AND IN ANY
EVENT WITHIN TEN (10) DAYS AFTER GUARANTOR LEARNS OF ANY SUCH ACTION OR
INACTION), GUARANTOR SHALL NOT ASSERT AGAINST LENDER, AND GUARANTOR SHALL BE
DEEMED TO HAVE WAIVED, ANY CLAIM OR DEFENSE ARISING THEREFROM.
43. No Oral Representations Limiting Enforcement. Guarantor acknowledges
Lender's intention to enforce this Guaranty to the fullest extent possible and
Guarantor acknowledges that Lender had made no oral statements to Guarantor that
could be construed as a waiver of Lender's right to enforce this Guaranty by all
available legal means.
EXECUTED the date first written above.
THE UNDERSIGNED ACKNOWLEDGES A THOROUGH UNDERSTANDING OF THE TERMS OF THIS
GUARANTY AND AGREES TO BE BOUND THEREBY.
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WITNESS
NOTICE TO GUARANTOR
You are being asked to guarantee all existing and future debts of the
Borrower entered into with this bank. Think carefully before you do. If the
Borrower does not pay the debt, you will have to. Be sure you can afford to pay
if you have to, and that you want to accept this responsibility.
You may have to pay up to the full amount of the debt if the Borrower does
not pay. You may also have to pay late fees or collection costs which increase
this amount.
The bank can collect the Obligations from you without first trying to
collect from the Borrower. The Bank can use the same collection methods against
you that can be used against the Borrower, such as ] suing you, garnishing your
wages, etc. If this debt is ever in default, that fact may become part of your
credit record.
This notice is not the contract that makes you liable for the debt.
I have read the above notice, understand its contents, and acknowledge
receipt of a copy of this notice this 30th day of May, 2000.
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XXXXXXX X. XXXXXX
