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CREDIT AGREEMENT
$15,000,000
between
XXXXXX LEASE FINANCE CORPORATION
and
CORESTATES BANK, N.A.
dated
June 12, 1997
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Table of Contents
1. Certain Definitions........................................................1
1.1. Definitions.................................................1
1.2. Accounting Terms............................................8
2. The Credit.................................................................9
2.1. The Loans...................................................9
2.2. Standby Letters of Credit..................................10
2.3. The Revolving Credit Note..................................10
2.4. Funding Procedures.........................................11
(a) Requests for Advance................................11
(b) Irrevocability......................................11
(c) Availability of Funds...............................11
2.5. Interest...................................................11
2.6. Fees.......................................................11
(a) Structuring and Arranging Fee.......................11
(b) Revolving Loan Commitment Fee.......................11
2.7. Reduction or Termination of Commitments....................11
(a) Voluntary...........................................11
(b) Revolving Loan Commitment Termination...............12
2.8. Voluntary Prepayments......................................12
2.9. Payments...................................................12
(a) Accrued Interest....................................12
(b) Form of Payments, Application of Payments,
Payment Administration, Etc.......................12
(c) Demand Deposit Account..............................12
(d) Net Payments........................................12
3. Representations and Warranties..........................................13
3.1. Organization, Standing.....................................13
3.2. Corporate Authority, Validity, Etc.........................13
3.3. Litigation.................................................13
3.4. ERISA......................................................13
3.5. Financial Statements.......................................14
3.6. Not in Default, Judgments, Etc.............................14
3.7. Taxes......................................................14
3.8. Permits, Licenses, Etc.....................................14
3.9. No Materially Adverse Contracts, Etc.......................14
3.10. Compliance with Laws, Etc..................................15
(a) Compliance Generally................................15
(b) Hazardous Wastes, Substances and Petroleum
Products..........................................15
3.11. Solvency...................................................15
3.12. Subsidiaries, Etc..........................................15
3.13. Title to Properties, Leases................................15
3.14. Public Utility Holding Company; Investment Company.........15
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3.15. Margin Stock...............................................16
3.16. Use of Proceeds............................................16
3.17. Depreciation Policies......................................16
3.18. Disclosure Generally.......................................16
4. Conditions Precedent....................................................16
4.1. All Loans..................................................16
(a) Request For Advance.................................16
(b) Borrowing Base Certificate..........................16
(c) Covenants; Representations..........................16
(d) Defaults............................................16
(e) Material Adverse Change.............................16
4.2. Conditions to First Loan...................................16
(a) Articles, Bylaws....................................17
(b) Evidence of Authorization...........................17
(c) Legal Opinions......................................17
(d) Incumbency..........................................17
(e) Note................................................17
(f) Documents...........................................17
(g) Consents............................................17
(h) Other Agreements....................................17
(i) Fees, Expenses......................................17
5. Affirmative Covenants...................................................17
5.1. Financial Statements and Reports...........................18
(a) Annual Statements...................................18
(b) Quarterly Statements................................18
(c) No Default..........................................18
(d) ERISA...............................................19
(e) Material Changes....................................19
(f) Other Information...................................19
(g) Borrowing Base Certificates.........................19
(h) Monthly Lease Portfolio and Receivables Report......19
(i) Maintenance of Current Depreciation Policies........19
(j) Monthly Lease Receipts Report.......................19
5.2. Corporate Existence........................................19
5.3. ERISA......................................................19
5.4. Compliance with Regulations................................20
5.5. Conduct of Business; Permits and Approvals,
Compliance with Laws.....................................20
5.6. Maintenance of Properties..................................20
5.7. Ownership..................................................20
5.8. Maintenance of Insurance...................................20
5.9. Payment of Debt; Payment of Taxes, Etc.....................20
5.10. Notice of Events...........................................21
5.11. Inspection Rights..........................................21
5.12. Generally Accepted Accounting Principles...................21
5.13. Compliance with Material Contracts.........................21
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5.14. Use of Proceeds............................................22
5.15. Further Assurances.........................................22
6. Negative Covenants......................................................22
6.1. Consolidation and Merger...................................22
6.2. Liens......................................................22
6.3. Guarantees.................................................22
6.4. Margin Stock...............................................22
6.5. Acquisitions and Investments...............................22
6.6. Transfer of Assets; Nature of Business.....................23
6.7. Accounting Change..........................................23
6.8. Transactions with Affiliates...............................23
6.9. Restriction on Amendment of This Agreement.................23
7. Financial Covenants.....................................................23
7.1. No losses..................................................23
7.3. Debt to Tangible Net Worth.................................23
7.4. Minimum Interest Expense Coverage..........................23
7.5. Borrowing Base.............................................24
8. Default.................................................................24
8.1. Events of Default..........................................24
(a) Payments............................................24
(b) Covenants...........................................24
(c) Representations, Warranties.........................24
(d) Bankruptcy..........................................24
(e) Certain Other Defaults..............................24
(f) Judgments...........................................25
(g) Attachments.........................................25
(h) Change in Control...................................25
(i) Security Interests..................................25
9. Collateral..............................................................25
9.1. Collateral.................................................25
9.2. Security Agreement.........................................26
9.3. Prepayments and Release of Collateral......................26
(a) Category A Equipment Held For Sale or
Subject To Lease..................................26
(b) Category A Equipment Not Subject to Lease;
Held for Greater Than Nine Months.................26
(c) Category B(1) Equipment.............................26
(d) Category B(2) Equipment.............................26
(e) Event of Default or Potential Default...............26
10. Miscellaneous...........................................................26
10.1. Waiver.....................................................26
10.2. Amendments.................................................27
10.3. Governing Law..............................................27
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10.4. Participations and Assignments.............................27
10.5. Captions...................................................27
10.6. Notices....................................................27
10.7. Expenses; Indemnification..................................28
10.8. Survival of Warranties and Certain Agreements..............28
10.9. Severability...............................................28
10.10. No Fiduciary Relationship..................................28
10.11. CONSENT TO JURISDICTION AND SERVICE OF PROCESS.............28
10.12. WAIVER OF JURY TRIAL.......................................29
10.13. Counterparts; Effectiveness................................29
10.14. Use of Defined Terms.......................................29
10.15. Offsets....................................................29
10.16. Entire Agreement...........................................29
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EXHIBIT A NOTE
EXHIBIT B BORROWING BASE CERTIFICATE
EXHIBIT C MORTGAGE AND SECURITY AGREEMENT
EXHIBIT D COMPLIANCE CERTIFICATE
EXHIBIT E DEPRECIATION POLICIES
SCHEDULE 1 MISCELLANEOUS INFORMATION
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Credit Agreement
This Credit Agreement, dated June 12, 1997 (the "Agreement"), is
entered into by and between XXXXXX LEASE FINANCE CORPORATION, a California
corporation ("Xxxxxx") and CORESTATES BANK, N.A., a national banking association
("CoreStates", "CoreStates Bank" or the "Bank").
Preliminary Statement
WHEREAS, Xxxxxx desires to have available to it a revolving credit
facility which will be used for the purchase of Equipment (as defined herein)
most of which will be held for sale or for lease to unaffiliated persons, said
Equipment and related leases to constitute part of the Collateral (as defined
herein).
WHEREAS, CoreStates Bank is willing to establish such revolving credit
facility and make loans to Xxxxxx under the terms and conditions hereinafter set
forth.
NOW, THEREFORE, in consideration of the premises and promises
hereinafter set forth and intending to be legally bound hereby, the parties
hereto agree as follows:
1. Certain Definitions
1.1. Definitions
"Affiliate" shall mean any Person: (1) which directly or indirectly
controls, or is controlled by, or is under common control with Xxxxxx;
(2) which directly or indirectly beneficially owns or holds ten percent
(10%) or more of any class of voting stock of Xxxxxx; or (3) ten
percent (10%) or more of whose voting stock of which is directly or
indirectly beneficially owned or held by Xxxxxx. The term "control"
means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of a Person, whether
through the ownership of voting securities, by contract, or otherwise.
"Agreement" shall mean this Credit Agreement, as amended, supplemented,
modified, replaced, substituted for or restated from time to time and
all exhibits and schedules attached hereto.
"Borrowing Base" shall mean 85% of Xxxxxx'x acquisition cost of
Equipment included in the Collateral, provided, however, that on June
30 and December 31 of each year a review of the Collateral shall be
made to determine whether the net book value of each piece of Equipment
has declined by more than 3% from the acquisition cost. In each such
case where the net book value has decreased by more than 3% from the
acquisition cost, the Borrowing Base shall mean 85% of the net book
value of such Equipment. No item of Category A Equipment shall be
included in the Borrowing Base unless either (1) it shall be the
subject of an Eligible Lease which is also included in the Collateral
or (2) it was purchased by Xxxxxx for the purpose of sale or lease to
an unaffiliated
Dated
Credit Agreement - 1 - June 12, 1997
Person and the purchase date is not later than nine months previous. No
item of Category B(1) Equipment shall be included in the Borrowing Base
if it was purchased by Xxxxxx more than nine months prior to the date
of determination of the Borrowing Base. No item of Category B(2)
Equipment shall be included in the Borrowing Base unless it shall be
the subject of an Eligible Lease which is also included in the
Collateral.
"Borrowing Base Certificate" shall mean a certificate in substantially
the form attached hereto as Exhibit B hereto which shall be signed by
the chief financial officer or chief executive officer of Xxxxxx.
"Business Day" shall mean any day other than a Saturday, Sunday, or
other day on which commercial banks in Philadelphia or San Francisco
are authorized or required to close under the laws of the Commonwealth
of Pennsylvania.
"Capitalized Lease" shall mean all lease obligations of any Person for
any property (whether real, personal or mixed) which have been or
should be capitalized on the books of the lessee in accordance with
General Accepted Accounting Principles.
"Capitalized Lease Obligations" with respect to any Person, shall mean
the aggregate amount which, in accordance with GAAP, is required to be
reported as a liability on the balance sheet of such Person at such
time in respect of such Person's interest as lessee under a Capital
Lease.
"Category A Equipment" shall mean equipment purchased by Xxxxxx from
unaffiliated Persons and which is either (1) the subject of an Eligible
Lease or (2) held for sale or lease to unaffiliated Persons. Category A
Equipment shall be composed of Stage III compliant jet engines which
are less than 15 years from the date of manufacture and are suitable
for use in major aircraft manufactured by The Boeing Co., XxXxxxxxx
Xxxxxxx Corp. or Airbus Industrie.
"Category B Equipment" shall mean equipment purchased by Xxxxxx from
unaffiliated Persons which is either (1) Stage II or III aircraft
acquired for the purpose of salvaging and/or retrofitting the engines
from such aircraft (such aircraft shall cease to be eligible for
inclusion in this Category B(1) upon removal of one or more of its jet
engines), or (2) traceable spare parts the purchase price of which was
in excess of $3,000 in each case, are the subject of Eligible Leases
and have discrete serial and part numbers or other identifying numbers
acceptable to the Bank.
"Closing Date" shall mean the date closing shall occur.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and all rules and regulations with respect thereto in
effect from time to time.
"Collateral" shall have the meaning set forth in ss.9.1.
"Compliance Certificate" shall mean a certificate in substantially the
form attached hereto as Exhibit D which shall be signed by the chief
financial officer, treasurer or controller of Xxxxxx.
Dated
Credit Agreement - 2 - June 12, 1997
"Debt" shall mean, as of any date of determination with respect to
Xxxxxx, without duplication, (i) all items which in accordance with
GAAP would be included in determining total liabilities as shown on the
liability side of a balance sheet of Xxxxxx as of the date on which
Debt is to be determined, (ii) all indebtedness of others with respect
to which Xxxxxx has become liable by way of a guarantee or endorsement
(other than for collection or deposit in the ordinary course of
business), (iii) all contingent liabilities of Xxxxxx, and (iv) lease
obligations that, in conformity with GAAP, have been capitalized on
Xxxxxx'x balance sheet.
"Debt Service" shall mean actual payments of principal on Debt and
Capitalized Lease Obligations (including any Debt or Capital Lease
Obligations paid from the sale of equipment during the period), plus
interest expense incurred during the period.
"Default Rate" on any Loan shall mean 2% per annum above the Prime
Rate.
"Dollars" shall mean the lawful currency of the United States of
America.
"EBIT" shall mean the sum of (i) Net Income, plus (ii) amounts deducted
for interest and taxes.
"Eligible Lease" shall mean a lease for Equipment to an unaffiliated
Person in which (i) Xxxxxx or its trustee is the sole lessor (ii) the
lease arose in the ordinary course of business of Xxxxxx, (iii) the
Equipment has been delivered to the lessee and is currently subject to
the lease, (iv) neither the lease nor the Equipment is subject to any
currently outstanding assignment, claim, lien, security interest or
other limitation on the absolute title of Xxxxxx or its trustee
thereto, (v) the lease payments are not more than 90 days past due with
respect to any payment required thereby (based on the original
contractual term and not including any amendment or modification
thereof, unless the Bank has specifically consented thereto in
writing), (vi) the lease is freely assignable (with any notices or
consents required in connection therewith having been previously
obtained), (vii) the lease is dated and has been in effect for not more
than 45 days prior to the date the lease was assigned to the Bank and
included in the Collateral in the case of leases entered into
subsequent to the Closing Date; or the lease was assigned to the Bank
and included in the Collateral within 45 days immediately following the
Closing Date, in the case of leases existing at the Closing Date
without regard to the date of the lease; or the lease was assigned to
the Bank and included in the Collateral within 45 days immediately
following the date of acquisition of said lease by Xxxxxx, in the case
of leases purchased from unaffiliated persons, (viii) the lease has not
been included in the Collateral for a period of more than twenty-four
months, (ix) the lease and the Equipment being leased constitute
Collateral, (x) the remaining lease term at the time of assignment to
the Bank is for a period of ten years or less in the case of Category A
Equipment and Category B(2) Equipment, (xi) the lease is a
noncancellable, triple net lease in which the lessee may not assert, as
an offset, any defenses or claims against the lessor arising from the
condition or the intended use of the subject matter), except in the
case of leases with terms of less than 6 months in which Xxxxxx may be
responsible for maintenance and (xii) the lessee is not a resident of,
and the Equipment will not be used in any, foreign jurisdiction in
which, in the sole determination of the Bank, the ability of the Bank
to perfect a first priority security interest in the Equipment is
unsatisfactory or the ability of the Bank to foreclose upon the
Equipment and receive possession to or sell said Equipment is
unsatisfactory.
Dated
Credit Agreement - 3 - June 12, 1997
"Environmental Control Statutes" shall mean each and every applicable
federal, state, county or municipal environmental statute, ordinance,
rule, regulation, order, directive or requirement, together with all
successor statutes, ordinances, rules, regulations, orders, directives
or requirements, of any Governmental Authority, including without
limitation laws in any way related to Hazardous Substances.
"Equipment" shall mean Category A Equipment and Category B Equipment.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as it may be amended from time to time.
"ERISA Affiliate" shall mean any corporation which is a member of the
same controlled group of corporations as Xxxxxx within the meaning of
ss.414(b) of the Code, or any trade or business which is under common
control with Xxxxxx within the meaning of ss.414(c) of the Code.
"Event of Default" shall have the meaning set forth in ss.8.1.
"Fiscal Quarter" shall mean a fiscal quarter of Xxxxxx, which shall be
any quarterly period ending on March 31, June 30, September 30 or
December 31 of any year.
"Fiscal Year" shall mean a fiscal year of Xxxxxx, which shall end on
the last day of December.
"Generally Accepted Accounting Principles" or "GAAP" shall mean
generally accepted accounting principles as in effect from time to time
in the United States, consistently applied.
"Governmental Authority" shall mean the federal, state, county or
municipal government, or any department, agency, bureau or other
similar type body obtaining authority therefrom or created pursuant to
any laws, including without limitation Environmental Control Statutes.
"Hazardous Substances" shall mean without limitation, any regulated
substance, toxic substance, hazardous substance, hazardous waste,
pollution, pollutant or contaminant, as defined or referred to in the
Resource Conservation and Recovery Act, as amended, 15 U.S.C., ss.2601
et seg.; the Comprehensive Environmental Response, Compensation and
Liability Act, 33 U.S.C. ss.1251 et seg.; the federal underground
storage tank law, Subtitle I of the Resource Conservation and Recovery
Act, as amended, P.L. 98-616, 42 U.S.C. ss.6901 et seg.; together with
any amendments thereto, regulations promulgated thereunder and all
substitutions thereof, as well as words of similar purport or meaning
referred to in any other federal, state, county or municipal
environmental statute, ordinance, rule or regulation.
"Indebtedness for Borrowed Money" shall mean (i) all indebtedness,
liabilities, and obligations, now existing or hereafter arising, for
money borrowed by Xxxxxx, whether or not evidenced by any note,
indenture, or agreement (including, without limitation, the Note and
any indebtedness for money borrowed from an Affiliate) and (ii) all
indebtedness of others for money borrowed (including indebtedness of an
Affiliate) with respect to which Xxxxxx has become liable by way of a
guarantee or indemnity.
Dated
Credit Agreement - 4 - June 12, 1997
"Intangible Assets" shall mean all assets which would be classed as
intangible assets under GAAP consistently applied, including, without
limitation, goodwill (whether representing the excess of cost over book
value of assets acquired or otherwise), patents, trademarks, trade
names, copyrights, franchises, and deferred charges (including, without
limitation, unamortized debt discount and expense, organization costs,
and research and development costs). For purposes of this definition,
prepayments of taxes, license fees and other expenses shall not be
deemed Intangible Assets.
"Investment" in any Person shall mean (a) the acquisition (whether for
cash, property, services or securities or otherwise) of capital stock,
bonds, notes, debentures, partnership or other ownership interests or
other securities of such Person; (b) any deposit with, or advance, loan
or other extension of credit to, such Person (other than any such
deposit, advance, loan or extension of credit having a term not
exceeding 90 days in the case of unaffiliated Persons and 120 days in
the case of Affiliates representing the purchase price of inventory or
supplies purchased in the ordinary course of business) or guarantee or
assumption of, or other contingent obligation with respect to,
Indebtedness for Borrowed Money or other liability of such Person; and
(c) (without duplication of the amounts included in (a) and (b)) any
amount that may, pursuant to the terms of such investment, be required
to be paid, deposited, advanced, lent or extended to or guaranteed or
assumed on behalf of such Person.
"Lien" shall mean any lien, mortgage, security interest, chattel
mortgage, pledge or other encumbrance (statutory or otherwise) of any
kind securing satisfaction of an Obligation, including any agreement to
give any of the foregoing, any conditional sales or other title
retention agreement, any lease in the nature thereof, and the filing of
or the agreement to give any financing statement under the Uniform
Commercial Code of any jurisdiction or similar evidence of any
encumbrance, whether within or outside the United States.
"Loan" or "Loans" shall mean a Revolving Credit Loan or Loans.
"Loan Documents" shall mean this Agreement, the Note, the Security
Agreement, and all other documents directly related or incidental to
said documents, the Loans or the Collateral.
"Material Adverse Change" shall mean any event or condition which, in
the reasonable determination of the Bank, could result in a material
adverse change in the financial condition, business, properties or
profits of Xxxxxx or which gives reasonable grounds to conclude that
Xxxxxx, may not or will not be able to perform or observe (in the
normal course) its obligations under the Loan Documents to which it is
a party, including but not limited to the Note.
"Material Adverse Effect" shall mean a material adverse effect (i) on
the financial condition, business, properties, or profits of Xxxxxx,
(ii) the ability of Xxxxxx to perform its obligations under this
Agreement, the Note and the other Loan Documents, or (iii) the
legality, validity or enforceability of this Agreement or the Note or
the rights and remedies of the holders of the Loans.
"Monthly Lease Portfolio and Receivables Report" shall mean a report in
summary form of the status of accounts receivable in respect of all
leases which are part of the Collateral in form and substance
reasonably satisfactory to the Bank.
Dated
Credit Agreement - 5 - June 12, 1997
"Multiemployer Plan" shall mean a multiemployer plan as defined in
ERISA ss.4001(a)(3), which covers employees of Xxxxxx or any ERISA
Affiliate.
"Net Income" shall mean net income after income taxes as shown on the
balance sheet.
"Net Worth" shall mean the sum of capital stock, plus paid-in capital,
plus retained earnings, minus treasury stock.
"Note" shall mean the Revolving Credit Note.
"Obligations" shall mean all now existing or hereafter arising debts,
obligations, covenants, and duties of payment or performance of every
kind, matured or unmatured, direct or contingent, owing, arising, due,
or payable to the Bank by or from Xxxxxx arising out of this Agreement
or any other Loan Document, including, without limitation, all
obligations to repay principal of and interest on the Loans, and to pay
interest, fees, costs, charges, expenses, professional fees, and all
sums chargeable to Xxxxxx or for which Xxxxxx is liable as indemnitor
under the Loan Documents, whether or not evidenced by any note or other
instrument.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any
successor thereto.
"Pension Plan" shall mean, at any time, any Plan (including a
Multiemployer Plan), the funding requirements of which (under ERISA
ss.302 or Code ss.412) are, or at any time within the six years
immediately preceding the time in question, were in whole or in part,
the responsibility of Xxxxxx or any ERISA Affiliate.
"Permitted Liens" shall mean (a) any Liens for current taxes,
assessments and other governmental charges not yet due and payable or
being contested in good faith by Xxxxxx by appropriate proceedings and
for which adequate reserves have been established by Xxxxxx as
reflected in Xxxxxx'x financial statements; (b) any mechanic's,
materialman's, carrier's, warehousemen's or similar Liens for sums not
yet due or being contested in good faith by Xxxxxx by appropriate
proceedings and for which adequate reserves have been established by
Xxxxxx as reflected in Xxxxxx'x financial statements; (c) easements,
rights-of-way, restrictions and other similar encumbrances on the real
property or fixtures of Xxxxxx incurred in the ordinary course of
business which individually or in the aggregate are not substantial in
amount and which do not in any case materially detract from the value
or marketability of the property subject thereto or interfere with the
ordinary conduct of the business of Xxxxxx; (d) Liens (other than Liens
imposed on any property of Xxxxxx pursuant to ERISA or ss.412 of the
Code) incurred or deposits made in the ordinary course of business,
including Liens in connection with workers' compensation, unemployment
insurance and other types of social security and Liens to secure
performance of tenders, statutory obligations, surety and appeal bonds
(in the case of appeal bonds such Lien shall not secure any
reimbursement or indemnity obligation in an amount greater than
$2,500,000), bids, leases that are not Capitalized Leases, performance
bonds, sales contracts and other similar obligations, in each case, not
incurred in connection with the obtaining of credit or the payment of a
deferred purchase price, and which do not, in the aggregate, result in
a Material Adverse Effect; and (e) Liens, if any, existing on the date
hereof and listed in Schedule 1 hereto other than Liens of the
character referred to in clause (f); (f) Liens on specific assets
purchased whether before or after the date hereof and any revenue
Dated
Credit Agreement - 6 - June 12, 1997
stream directly attributable thereto provided that such liens are
limited to the Equipment so purchased and the revenue stream generated
therefrom.
"Person" shall mean any individual, corporation, partnership, joint
venture, association, company, business trust or entity, or other
entity of whatever nature.
"Plan" shall mean an employee benefit plan as defined in ss.3(3) of
ERISA, other than a Multiemployer Plan, whether formal or informal and
whether legally binding or not.
"Potential Default" shall mean an event, condition or circumstance that
with the giving of notice or lapse of time or both would become an
Event of Default.
"Prime Rate" shall mean, for any day, the prime commercial lending rate
of CoreStates Bank, N.A., as announced from time to time at its head
office, calculated on the basis of 30 day months and a year of 360
days.
"Prohibited Transaction" shall mean a transaction that is prohibited
under Code ss.4975 or ERISA ss.406 and not exempt under Code ss.4975 or
ERISA ss.408.
"Regulation" shall mean any statute, law, ordinance, regulation, order
or rule of any United States or foreign, federal, state, local or other
government or governmental body, including, without limitation, those
covering or related to banking, financial transactions, securities,
public utilities, environmental control, energy, safety, health,
transportation, bribery, record keeping, zoning, antidiscrimination,
antitrust, wages and hours, employee benefits, and price and wage
control matters.
"Release" shall mean without limitation, the presence, leaking,
leaching, pouring, emptying, discharging, spilling, using, generating,
manufacturing, refining, transporting, treating, or storing of
Hazardous Substances at, into, onto, from or about the property or the
threat thereof, regardless of whether the result of an intentional or
unintentional action or omission, and which is in violation of
applicable law.
"Reportable Event" shall mean, with respect to a Pension Plan: (a) Any
of the events set forth in ERISA Sections 4043(b) (other than a
reportable event as to which the provision of 30 days' notice to the
PBGC is waived under applicable regulations) or 4063(a) or the
regulations thereunder, (b) an event requiring any Xxxxxx or any ERISA
Affiliate to provide security to a Pension Plan under Code
ss.401(a)(29) and (c) any failure by any Xxxxxx or any ERISA Affiliate
to make payments required by Code ss.412(m).
"Revolver Termination Date" shall meaning set forth in ss.2.1.
"Revolving Credit Loan" shall have the meaning set forth in ss.2.1.
"Revolving Credit Note" shall have the meaning set for in ss.2.2.
"Revolving Loan Commitment" shall have the meaning set forth in ss.2.1.
Dated
Credit Agreement - 7 - June 12, 1997
"Revolving Loan Commitment Fee" shall have the meaning set forth in
ss.2.5.(b).
"Security Agreement" shall mean the Mortgage and Security Agreement in
the form and substance attached hereto as Exhibit C.
"Solvent" shall mean, with respect to any Person, that the aggregate
present fair saleable value of such Person's assets is in excess of the
total amount of its probable liabilities on its existing debts as they
become absolute and matured, such Person has not incurred debts beyond
its foreseeable ability to pay such debts as they mature, and such
Person has capital adequate to conduct the business it is presently
engaged in or is about to engage in.
"Standby Letter of Credit" shall mean only those standby letters of
credit issued pursuant to a completed application on the form of letter
of credit application required by the Bank at the time of the request
for each Standby Letter of Credit.
"Subsidiary" shall mean a corporation or other entity the shares of
stock or other equity interests of which having ordinary voting power
(other than stock or other equity interests having such power only by
reason of the happening of a contingency) to elect a majority of the
board of directors or other managers of such corporation are at the
time owned, or the management of which is otherwise controlled,
directly or indirectly through one or more intermediaries or both, by
Xxxxxx.
"Tangible Net Worth" shall mean Net Worth, minus Intangible Assets.
"Termination Event" shall mean, with respect to a Pension Plan: (a) a
Reportable Event, (b) the termination of a Pension Plan, or the filing
of a notice of intent to terminate a Pension Plan, or the treatment of
a Pension Plan amendment as a termination under ERISA ss.4041(c), (c)
the institution of proceedings to terminate a Pension Plan under ERISA
ss.4042 or (d) the appointment of a trustee to administer any Pension
Plan under ERISA ss.4042.
"Unfunded Pension Liabilities" shall mean, with respect to any Pension
Plan at any time, the amount determined by taking the accumulated
benefit obligation, as disclosed in accordance with Statement of
Accounting Standards No. 87, over the fair market value of Pension Plan
assets.
"Unrecognized Retiree Welfare Liability" shall mean, with respect to
any Plan that provides post-retirement benefits other than pension
benefits, the amount of the accumulated post-retirement benefit
obligation, as determined in accordance with Statement of Financial
Accounting Standards No. 106, as of the most recent valuation date.
Prior to the date such statement is applicable to any Xxxxxx, such
amount of the obligation shall be based on an estimate made in good
faith.
1.2 Accounting Terms. All accounting terms not specifically defined
herein shall be construed in accordance with Generally Accepted Accounting
Principles consistent with those applied in the preparation of the financial
statements referred to in ss.3.5, and all financial data submitted pursuant to
this Agreement shall be prepared in accordance with such principles.
Dated
Credit Agreement - 8 - June 12, 1997
2. The Credit
2.1. The Loans. Subject to the terms and conditions herein set forth
and in reliance upon the representations, warranties and covenants contained
herein, CoreStates Bank agrees to make revolving credit loans ("Revolving Credit
Loans") to Xxxxxx upon receipt of loan requests therefor in amounts not to
exceed at any time outstanding, in the aggregate, $15,000,000 (such amount, as
the same may be reduced pursuant to ss.2.7 hereof being hereinafter called the
"Revolving Loan Commitment"). For purposes of determining the amount of
Revolving Credit Loans outstanding, the Standby Letters of Credit issued
pursuant to ss.2.2 hereof shall be deemed Revolving Credit Loans and shall be
added to the Revolving Credit Loans outstanding to determine the aggregate
Revolving Credit Loans outstanding. As provided below, Revolving Credit Loans
may be requested by Xxxxxx, and made from time to time prior to the Revolver
Termination Date. All Loans shall be made to Xxxxxx at the main office of the
Bank, Xxxxx xxx Xxxxxxxx Xxxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000.
Revolving Credit Loans may be made from time to time during the period
beginning on the date hereof and ending on June 12, 1998 or on the earlier date
of termination in full, pursuant to ss.2.7 or ss.8.1 hereof, of the obligations
of the Bank under this ss.2.1 (June 12, 1998 or such earlier date of termination
being herein called the "Revolver Termination Date"). Revolving Credit Loans at
the occasion of each borrowing shall be in aggregate principal amounts at least
equal to $150,000 or, if less, the remaining unused amount of the Revolving Loan
Commitment. Xxxxxx shall not be entitled to any Revolving Credit Loan if, after
giving effect to such Loan, the unpaid amount of the then outstanding Revolving
Credit Loans would exceed the then current Borrowing Base. Prior to the Revolver
Termination Date and within the limits of the Revolving Loan Commitment and the
Borrowing Base, Xxxxxx may borrow, prepay and reborrow Revolving Credit Loans.
All Revolving Credit Loans shall mature and be due and payable as set forth in
the next paragraph of this ss.2.1 unless the maturity of said Loans is
accelerated as provided in ss.2.7 or ss.8.1 hereof.
At the end of each Agreement Year, Xxxxxx may request that the Revolver
Termination Date be extended for one full year by notifying CoreStates Bank in
writing not more than 90 days nor less than 60 days prior to the end of the
existing Agreement Year that it desires an extension of the Revolver Termination
Date. If CoreStates Bank in its sole discretion shall elect to extend the
Revolver Termination Date for one full year, it shall notify Xxxxxx in writing
prior to the end of the existing Agreement Year that it is willing to extend the
Revolver Termination Date on the terms and conditions set forth herein. If
CoreStates Bank shall not issue such written notice, the Revolver Termination
Date shall not be deemed extended. In the Event that the Revolver Termination
Date is not extended and provided that the maturity date of the Revolving Credit
Loans has not been accelerated as provided in ss.2.7 or ss.8.1 hereof, the
outstanding principal balance of the Note shall be repaid in 23 monthly
installments, each in the amount of the greater of (i) 1.75% of the Revolving
Credit Loans outstanding at the Revolver Termination Date or (ii) 90% of the
aggregate lease payments received in respect of items of Collateral which are
subject to lease during the specified month and a final installment in the
amount of the unpaid balance of the Revolving Credit Loans outstanding at the
end of the 24th month following the Revolver Termination Date. In addition to
the monthly payments described above, if any payment is required to be made in
order to remain in compliance with the Borrowing Base covenant in ss.7.5 herein,
such additional payment shall reduce the final installment only and shall not
have any effect on the 23 monthly installments. The term "Agreement Year" shall
mean a one year period ending on the same month and day as the Revolver
Dated
Credit Agreement - 9 - June 12, 1997
Termination Date. The first Agreement Year will expire on the first anniversary
of the date of this Agreement.
Xxxxxx may have Revolving Credit Loans outstanding at any time and from
time to time in an aggregate amount up to, but not exceeding $5,000,000 for the
acquisition of Category B Equipment. Any item of Category B Equipment which is a
Stage III jet engine shall be deducted from Category B Equipment and become part
of Category A Equipment upon the physical removal of that engine from its
airframe, provided that such Equipment otherwise qualifies as Category A
Equipment.
2.2. Standby Letters of Credit. The Bank, under the terms and subject
to the conditions of this Agreement, agrees to provide Standby Letters of Credit
to Xxxxxx, from time to time prior to the Revolver Termination Date, as
requested by Xxxxxx, provided that (A) the aggregate amount of Standby Letters
of Credit outstanding at any one time shall not exceed $2,000,000 or such lesser
amount, if any, as will, when added to the amount of the Revolving Credit Loans
then outstanding, aggregate $15,000,000 (or such lesser amount as Xxxxxx is
entitled to borrow hereunder at such time by reason of the limitation of the
Borrowing Base or otherwise), and (B) no Standby Letter of Credit shall be for a
term longer than one year.
Xxxxxx shall request a Standby Letter of Credit by delivering a
completed letter of credit application to the Bank on such form as may be
specified by the Bank not less than three Business Days prior to the date
specified by Xxxxxx as the date the Standby Letter of Credit is to be issued.
The standard form of CoreStates' letter of credit application as currently in
effect shall be used.
Standby Letters of Credit shall not bear interest until drawn upon but
shall each be subject to an annual charge, payable in advance, as such may exist
from time to time, provided, however, that at no time shall the annual charge
for any Standby Letter of Credit exceed 2.75%.
Any obligation of Xxxxxx to pay money in connection with any Standby
Letter of Credit or the application therefor shall be deemed secured as if made
as a Loan hereunder. In the event Xxxxxx shall terminate the Commitment as
provided in ss.2.6 and shall pay the outstanding principal amount of the
Revolving Credit Loans in full and with interest or the Revolver Termination
Date shall occur at a time when one or more Standby Letters of Credit remain
outstanding, then Xxxxxx shall furnish to the Bank within two Business Days such
amount of cash, to be held as cash collateral and invested in certificates of
deposit of the Bank with interest payable to Xxxxxx, as will pay the maximum
amount which may be drawn by beneficiaries of Standby Letters of Credit
outstanding at the date of such termination or the Revolver Termination Date, as
applicable.
2.3. The Revolving Credit Note. The Revolving Credit Loans made by the
Bank shall be evidenced by a single promissory note of Xxxxxx (such promissory
note as it may be amended, extended, modified, restated, replaced, substituted
for or renewed, the "Revolving Credit Note") in principal face amount equal to
the Bank's Revolving Loan Commitment, payable to the order of the Bank and
otherwise in the form attached hereto as Exhibit A. The Revolving Credit Note
shall be dated the Closing Date, shall bear interest at the rate per annum and
be payable as to principal and interest in accordance with the terms hereof.
Each outstanding Revolving Credit Loan shall be and payable as set forth in
ss.2.1 hereof unless the maturity of said Loans is accelerated as provided in
ss.2.7 or ss.8.1 hereof. The Bank shall maintain records of all Loans evidenced
by the Revolving Credit Notes and of all payments thereon, which records shall
be conclusive absent manifest error
Dated
Credit Agreement - 10 - June 12, 1997
2.4. Funding Procedures
(a) Requests for Advance. Each request for a Loan shall be made not
later than 2:00 p.m. on a Business Day by delivery to the Bank of a written
request signed by Xxxxxx or in the alternative a telephone request followed
promptly by written confirmation of the request, specifying the date, amount and
type of the Loan to be made. Each request shall be received not less than one
Business Day prior to the date of the proposed borrowing. No request shall be
effective until actually received in writing by the Bank. Xxxxxx may not request
more than three advances per week.
(b) Irrevocability. Upon receipt of a request for a Loan and if the
conditions precedent provided herein shall be satisfied at the time of such
request, the request for a Loan shall not be revocable by Xxxxxx.
(c) Availability of Funds. In the case of a borrowing, the Bank will
make funds immediately available to Xxxxxx on the date of each Loan by a credit
to the account of Xxxxxx at the Bank's address set forth opposite its name on
the signature page hereof.
2.5. Interest. Each Loan shall bear interest on the principal amount
thereof from the date made until such Loan is paid in full, at a rate per annum
equal to the Prime Rate plus 1/2 of 1%.
2.6. Fees.
(a) Structuring and Arranging Fee. Xxxxxx agrees to pay to the Bank a
structuring and arranging fee (the "Fee") in the amount of 1/2 of 1% of the
Revolving Loan Commitment at the time this Agreement is executed and delivered
by both parties. The $10,000 deposit paid to the Bank by Xxxxxx in March, 1997
shall be credited in full to the amount due with respect to the Closing Fee.
(b) Revolving Loan Commitment Fee. Xxxxxx agrees to pay to the Bank as
compensation for the Revolving Loan Commitment, a fee (the "Revolving Loan
Commitment Fee") computed as follows: (1) when the average daily balance of the
aggregate Loans outstanding under the Revolving Credit Note (measured over the
previous calendar quarter or portion thereof, as applicable) is less than 50% of
the Revolving Loan Commitment, Xxxxxx shall pay a Revolving Loan Commitment Fee
equal to 3/8 of 1% of the unused portion of the Revolving Loan Commitment, and
(2) when the average daily balance of the aggregate Loans outstanding under the
Revolving Credit Note (measured over the previous calendar quarter or portion
thereof, as applicable) is at least 50% of the Revolving Loan Commitment, Xxxxxx
shall pay a Revolving Loan Commitment Fee equal to 1/4 of 1% of the unused
portion of the Revolving Loan Commitment. The Revolving Loan Commitment Fee
shall be payable in arrears on the first day of each January, April, July and
October, commencing July 1, 1997 (for the three month period or portion thereof
ended on the preceding day), and ending on the Revolver Termination Date. The
Revolving Loan Commitment Fee shall be calculated on the basis of a 360 day
year.
2.7. Reduction or Termination of Commitments.
(a) Voluntary. Xxxxxx may at any time, on not less than one Business
Days' written notice, terminate or permanently reduce the Revolving Loan
Commitment, provided that any reduction shall be
Dated
Credit Agreement - 11 - June 12, 1997
in the minimum amount of $150,000 or a multiple thereof and that no such
reduction shall cause the principal amount of Loans outstanding to exceed the
reduced Revolving Loan Commitment.
(b) Revolving Loan Commitment Termination. In the event the Revolving
Loan Commitment is terminated, the Revolver Termination Date shall be
accelerated to the date of such termination and Xxxxxx shall, simultaneously
with such termination, repay the Revolving Credit Loans in accordance with
ss.2.9.
2.8 Voluntary Prepayments. On one Business Day's notice to the Bank,
Xxxxxx may, without penalty, at its option, prepay any Loan in whole at any time
or in part from time to time, provided that each partial prepayment shall be in
the minimum principal amount of $150,000 or, if greater, then in multiples
thereof and, if less than $150,000 shall be outstanding, in principal amount
equal to amount remaining outstanding. Notwithstanding the foregoing,
prepayments may be made in connection with the release of collateral as provided
in ss.9.3, which prepayments shall not be subject to the requirements of the
previous sentence.
2.9. Payments.
(a) Accured Interest. Accrued interest on all Loans shall be due and
payable on the first Business Day of each calendar month and upon the Revolver
Termination Date.
(b) Form of Payments, Application of Payments, Payment Administration,
Ect. All payments of principal, interest, fees, or other amounts payable by
Xxxxxx hereunder shall be remitted to the Bank at the address set forth opposite
its name on the signature page hereof or at such office or account as the Bank
shall specify to Xxxxxx, in immediately available funds not later than 2:00 p.m.
on the day when due. Whenever any payment is stated as due on a day which is not
a Business Day, the maturity of such payment shall be extended to the next
succeeding Business Day and interest and commitment fees shall continue to
accrue during such extension. Xxxxxx authorizes the Bank to deduct from any
account of Xxxxxx maintained at the Bank or over which the Bank has control any
amount payable under this Agreement, the Note or any other Loan Document which
is not paid in a timely manner. The Bank's failure to deliver any xxxx,
statement or invoice with respect to amounts due under this Section or under any
Loan Document shall not affect Xxxxxx'x obligation to pay any installment of
principal, interest or any other amount under this Agreement when due and
payable.
(c) Demand Deposit Account. Xxxxxx shall maintain at least one demand
deposit account with the Bank for purposes of this Agreement. Xxxxxx authorizes
the Bank to deposit into said account all amounts to be advanced to Xxxxxx
hereunder. Further, Xxxxxx authorizes the Bank (but the Bank shall not be
obligated) to deduct from said account, or any other account maintained by
Xxxxxx at the Bank, any amount payable hereunder on or after the date upon which
it is due and payable. Such authorization shall include but not be limited to
amounts payable with respect to principal, interest, fees and expenses.
(d) Net Payments. All payments made to the Bank by Xxxxxx hereunder,
under any Note or under any other Loan Document will be made without set off,
counterclaim or other defense.
Dated
Credit Agreement - 12 - June 12, 1997
3. Representations and Warranties
Xxxxxx represents and warrants to the Bank that:
3.1. Organization, Standing. It (i) is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation, (ii) has the corporate power and authority necessary to own its
assets, carry on its business and enter into and perform its obligations
hereunder, and under each Loan Document to which it is a party, and (iii) is
qualified to do business and is in good standing in each jurisdiction where the
nature of its business or the ownership of its properties requires such
qualification, except where the failure to be so qualified would not have a
Material Adverse Effect.
3.2. Corporate Authority, Validity, Etc. The making and performance of
the Loan Documents to which it is a party are within its power and authority and
have been duly authorized by all necessary corporate action. The making and
performance of the Loan Documents do not and under present law will not require
any consent or approval not obtained of any of Xxxxxx'x shareholders, or any
other person, do not and under present law will not violate any law, rule,
regulation order, writ, judgment, injunction, decree, determination or award, do
not violate any provision of its charter or by-laws, do not and will not result
in any breach of any material agreement, lease or instrument to which it is a
party, by which it is bound or to which any of its assets are or may be subject,
and do not and will not give rise to any Lien upon any of its assets. The number
of shares and classes of the capital stock of Xxxxxx and the ownership thereof
are accurately set forth on Schedule 1 attached hereto; all such shares are
validly issued, fully paid and non-assessable, and the issuance and sale thereof
are in compliance with all applicable federal and state securities and other
applicable laws. Further, Xxxxxx is not in default under any such agreement,
lease or instrument except to the extent such default reasonably could not have
a Material Adverse Effect. No authorizations, approvals or consents of, and no
filings or registrations with, any governmental or regulatory authority or
agency are necessary for the execution, delivery or performance by Xxxxxx of any
Loan Document to which it is a party or for the validity or enforceability
thereof, except any filings or registrations expressly contemplated by the Loan
Documents. Each Loan Document, when executed and delivered, will be the legal,
valid and binding obligation of Xxxxxx, enforceable against it in accordance
with its terms.
3.3. Litigation. Except as disclosed on Schedule 1, there are no
actions, suits or proceedings pending or, to Xxxxxx'x knowledge, threatened
against or affecting Xxxxxx or any of its assets before any court, government
agency, or other tribunal which if adversely determined reasonably could have a
Material Adverse Effect or upon the ability of Xxxxxx to perform under the Loan
Documents. If there is any disclosure on Schedule 1, the status (including the
tribunal, the nature of the claim and the amount in controversy) of each such
litigation matter as of the date of this Agreement is set forth in Schedule 1.
3.4. ERISA. (a) Xxxxxx and each ERISA Affiliate are in compliance in all
material respects with all applicable provisions of ERISA and the regulations
promulgated thereunder; and, neither Xxxxxx, nor any ERISA Affiliate maintains
or contributes to or has maintained or contributed to any multiemployer plan (as
defined in ss.4001 of ERISA) under which Xxxxxx or any ERISA Affiliate could
have any withdrawal liability; (b) neither Xxxxxx nor any ERISA Affiliate,
sponsors or maintains any Plan under which there is an accumulated funding
deficiency within the meaning of ss.412 of the Code, whether or not waived; (c)
the aggregate liability for accrued benefits and other ancillary benefits under
each Plan that is or will be sponsored or maintained by Xxxxxx or any ERISA
Affiliate (determined on the basis of the actuarial
Dated
Credit Agreement - 13 - June 12, 1997
assumptions prescribed for valuing benefits under terminating single-employer
defined benefit plans under Title IV of ERISA) does not exceed the aggregate
fair market value of the assets under each such defined benefit pension Plan;
(d) the aggregate liability of Xxxxxx and each ERISA Affiliate arising out of or
relating to a failure of any Plan to comply with the provisions of ERISA or the
Code, will not have a Material Adverse Effect; and (e) there does not exist any
unfunded liability (determined on the basis of actuarial assumptions utilized by
the actuary for the plan in preparing the most recent Annual Report) of Xxxxxx
or any ERISA Affiliate under any plan, program or arrangement providing
post-retirement life or health benefits.
3.5. Financial Statements. The consolidated financial statements of
Xxxxxx as of and for the Fiscal Years ending December 31, 1996 and December 31,
1995, consisting of a balance sheet, a statement of operations, a statement of
shareholders' equity, a statement of cash flows and accompanying footnotes, and
the interim consolidated and consolidating financial statements of Xxxxxx as of
March 31, 1997 furnished to the Bank in connection herewith, present fairly, in
all material respects, the financial position, results of operations and
operating statistics Xxxxxx as of the dates and for the periods referred to, in
conformity with GAAP. Except as set forth on Schedule 1 hereto, there are no
liabilities, fixed or contingent, which are not reflected in such financial
statements, other than liabilities which are not required to be reflected in
such balance sheets.
3.6. Not in Default, Judgments, Etc. No Event of Default or Potential
Default under any Loan Document has occurred and is continuing. Xxxxxx has
satisfied all judgments and is not in default with respect to any judgment,
writ, injunction, decree, rule, or regulation of any court, arbitrator, or
federal, state, municipal, or other governmental authority, commission, board
bureau, agency, or instrumentality, domestic or foreign.
3.7 Taxes. Xxxxxx has filed all federal, state, local and foreign tax
returns and reports which it is required by law to file and as to which its
failure to file would have a Material Adverse Effect, and has paid all taxes,
including wage taxes, assessments, withholdings and other governmental charges
which are presently due and payable, other than those being contested in good
faith by appropriate proceedings, if any, and disclosed on Schedule 1. The tax
charges, accruals and reserves on the books of Xxxxxx are adequate to pay all
such taxes that have accrued but are not presently due and payable.
3.8. Permits, Licenses, Etc. Xxxxxx possesses all permits, licenses,
franchises, trademarks, trade names, copyrights and patents necessary to the
conduct of its business as presently conducted or as presently proposed to be
conducted, except where the failure to possess the same would not have a
Material Adverse Effect.
3.9. No Materially Adverse Contracts, Etc. To the best of its knowledge,
Xxxxxx is not subject to any charter, corporate or other legal restriction, or
any judgment, decree, order, rule or regulation which in the judgment of its
directors or officers has or is expected in the future to have a materially
adverse effect on its operations, business, assets, liabilities or upon its
ability to perform under the Loan Documents. Xxxxxx is not a party to any
contract or agreement which in the judgment of its directors or officers has or
is expected to have any materially adverse effect on its business, except as
otherwise reflected in adequate reserves.
Dated
Credit Agreement - 14 - June 12, 1997
3.10. Compliance with Laws, Etc.
(a) Compliance Generally. Xxxxxx is in compliance in all material
respects with all Regulations applicable to its business (including obtaining
all authorizations, consents, approvals, orders, licenses, exemptions from, and
making all filings or registrations or qualifications with, any court or
governmental department, public body or authority, commission, board, bureau,
agency, or instrumentality), the noncompliance with which reasonably could have
a Material Adverse Effect.
(b) Hazardous Wastes, Substances and Petroleum Products. Xxxxxx
received all permits and filed all notifications necessary to carry on its
business; and is in compliance in all respects with all Environmental Control
Statutes. Xxxxxx has not given any written or oral notice, nor has it failed to
give required notice, to the Environmental Protection Agency ("EPA") or any
state or local agency with regard to any actual or imminently threatened Release
of Hazardous Substances on properties owned, leased or operated by it or used in
connection with the conduct of its business and operations. Xxxxxx has not
received notice that it is potentially responsible for costs of clean-up or
remediation of any actual or imminently threatened Release of Hazardous
Substances pursuant to any Environmental Control Statute. No real property owned
or leased by it is in violation of any Environmental Laws and no Hazardous
Substances are present on said real property in violation of applicable law.
Xxxxxx has not been identified in any litigation, administrative proceedings or
investigation as a potentially responsible party for any liability under any
Environmental Laws.
3.11. Solvency. Xxxxxx is, and after giving effect to the transactions
contemplated hereby, will be, Solvent.
3.12. Subsidiaries, Etc. Xxxxxx does not have any Subsidiaries, except
as set forth In Schedule 1 hereto. Set forth in Schedule 1 hereto is a complete
and correct list, as of the date of this Agreement, of all Investments held by
Xxxxxx in any joint venture or other Person.
3.13. Title to Properties, Leases. Xxxxxx has good and marketable title
to all assets and properties reflected as being owned by it in its financial
statements as well as to all assets and properties acquired since said date
(except property disposed of since said date in the ordinary course of
business). Except for the Liens set forth in Schedule 1 hereto and any other
Permitted Liens, there are no Liens on any of such assets or properties. It has
the right to, and does, enjoy peaceful and undisturbed possession under all
material leases under which it is leasing property as a lessee. All such leases
are valid, subsisting and in full force and effect, and none of such leases is
in default, except where such default, either individually or in the aggregate,
could not have a Material Adverse Effect.
3.14. Public Utility Holding Company; Investment Company. Xxxxxx is not
a "public utility company" or a "holding company", or a "subsidiary company" of
a "holding company", or an "affiliate" of a "holding company" or of a
"subsidiary company" of a "holding company", as such terms are defined in the
Public Utility Holding Company Act of 1935, as amended; or a "public utility"
within the meaning of the Federal Power Act, as amended. Further, it is not an
"investment company" or an "affiliated person" of an "investment company" or a
company "controlled" by an "investment company" as such terms are defined in the
Investment Company Act of 1940, as amended.
Dated
Credit Agreement - 15 - June 12, 1997
3.15. Margin Stock. Xxxxxx is not and will not be engaged principally or
as one of its important activities in the business of extending credit for the
purpose of purchasing or carrying or trading in any margin stocks or margin
securities (within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System as amended from time to time). Neither will it use or
permit any proceeds of the Loans to be used, either directly or indirectly, for
the purpose, whether immediate, incidental or ultimate, of buying or carrying
margin stocks or margin securities.
3.16. Use of Proceeds. Xxxxxx will use the proceeds of any Loan to be
made pursuant hereto for the purchase of Equipment as contemplated herein.
3.17. Depreciation Policies. Xxxxxx'x depreciation policies are as set
forth on Exhibit E. These policies have been in effect without change since
January 1, 1997.
3.18. Disclosure Generally. The representations and statements made by
Xxxxxx or on its behalf in connection with this credit facility and the Loans,
including representations and statements in each of the Loan Documents, do not
and will not contain any untrue statement of a material fact or omit to state a
material fact or any fact necessary to make the representations made not
materially misleading. No written information, exhibit, report, brochure or
financial statement furnished by Xxxxxx to the Bank in connection with this
credit facility, the Loans, or any Loan Document contains or will contain any
material misstatement of fact or omit to state a material fact or any fact
necessary to make the statements contained therein not misleading.
4. Conditions Precedent
4.1. All Loans. The obligation of the Bank to make any Loan is
conditioned upon the following:
(a) Request For Advance. Xxxxxx shall have delivered and the Bank shall
have received a Request for Advance in such form as the Bank may request from
time to time.
(b) Borrowing Base Certificate. Xxxxxx shall have delivered and the
Bank shall have received a Borrowing Base Certificate dated the date of the Loan
Requested under this Agreement.
(c) Covenants; Representation. Xxxxxx shall be in compliance with all
covenants, agreements and conditions in each Loan Document and each
representation and warranty contained in each Loan Document shall be true with
the same effect as if such representation or warranty had been made on the date
such Loan is made or issued.
(d) Defaults. Immediately prior to and after giving effect to such
transaction, no Event of Default or Potential Default shall exist.
(e) Material Adverse Change. Since March 31, 1997, there shall not have
been any Material Adverse Change with respect to Xxxxxx.
4.2. Conditions to First Loan. In addition to the conditions to all
Loans as provided in ss.4.1, the obligation of the Bank to make the first Loan
is conditioned upon the following:
Dated
Credit Agreement - 16 - June 12, 1997
(a) Articles, Bylaws. The Bank shall have received copies of the
Articles or Certificate of Incorporation and Bylaws of Xxxxxx certified by its
Secretary or Assistant Secretary; together with Certificate of Good Standing
from any jurisdiction where the nature of its business or the ownership of its
properties requires such qualification except where the failure to be so
qualified would not have a Material Adverse Effect.
(b) Evidence of Authorization. The Bank shall have received copies
certified by the Secretary or Assistant Secretary of Xxxxxx or other appropriate
official (in the case of a Person other than Xxxxxx) of all corporate or other
action taken by each Person other than the Bank who is a party to any Loan
Document to authorize its execution and delivery and performance of the Loan
Documents and to authorize the Loans, together with such other related papers as
the Bank shall reasonably require.
(c) Legal Opinions. The Bank shall have received a favorable written
opinions in form and substance satisfactory to the Bank from Xxxx Xxxxxxx,
Counsel of Xxxxxx, and McAfee & Xxxx, P.C., or other reasonably acceptable
counsel which shall be addressed to the Bank and be dated the date of the first
Loan.
(d) Incumbency. The Bank shall have received a certificate signed by
the secretary or assistant secretary of Xxxxxx, together with the true signature
of the officer or officers authorized to execute and deliver the Loan Documents
and certificates thereunder, upon which the Bank shall be entitled to rely
conclusively until it shall have received a further certificate of the secretary
or assistant secretary of Xxxxxx amending the prior certificate and submitting
the signature of the officer or officers named in the new certificate as being
authorized to execute and deliver Loan Documents and certificates thereunder.
(e) Note. The Bank shall have received the Revolving Credit Note duly
executed, completed and issued in accordance herewith.
(f) Documents. The Bank shall have received all certificates,
instruments and other documents then required to be delivered pursuant to any
Loan Documents, in each instance in form and substance reasonably satisfactory
to it.
(g) Consents. Xxxxxx shall have provided to the Bank evidence
satisfactory to it that all governmental, shareholder and third party consents
and approvals necessary in connection with the transactions contemplated hereby
have been obtained and remain in effect.
(h) Other Agreements. Xxxxxx shall have executed and delivered each
other Loan Document required hereunder.
(i) Fees, Expenses. Xxxxxx shall simultaneously pay or shall have paid
all fees and expenses due hereunder or any other Loan Document.
5. Affirmative Covenants
Xxxxxx covenants and agrees that, without the prior written consent of
the Bank, from and after the date hereof and so long as any Obligation remains
unpaid or outstanding, it will:
Dated
Credit Agreement - 17 - June 12, 1997
5.1. Financial Statements and Reports. Furnish to the Bank the following
financial information:
(a) Annual Statements. No later than one hundred and twenty (120) days
after the end of each Fiscal Year, the consolidated and consolidating balance
sheet of Xxxxxx as of the end of such year and the prior year in comparative
form, and related statements of operations, shareholders' equity, and cash flows
for the Fiscal Year and the prior Fiscal Year in comparative form. The financial
statements shall be in reasonable detail with appropriate notes and be prepared
in accordance with GAAP. The consolidated annual financial statements shall be
certified (without any qualification or exception) by KPMG Peat Marwick LLP or
other independent public accountants reasonably acceptable to the Bank. Such
financial statements shall be accompanied by a report of such independent
certified public accountants stating that, in the opinion of such accountants,
such financial statements present fairly, in all material respects, the
financial position, and the results of operations and the cash flows of Xxxxxx
for the period then ended in conformity with GAAP, except for inconsistencies
resulting from changes in accounting principles and methods agreed to by such
accountants and specified in such report, and that, in the case of such
financial statements, the examination by such accountants of such financial
statements has been made in accordance with generally accepted auditing
standards and accordingly included examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements and assessing
the accounting principles used and significant estimates made, as well as
evaluating the overall financial statement presentation. Each financial
statement provided under this subsection (a) shall be accompanied by a
certificate signed by such accountants either stating that during the course of
their examination nothing came to their attention which would cause them to
believe that any event has occurred and is continuing which constitutes an Event
of Default or Potential Default, or describing each such event. In addition to
the annual financial statements, Xxxxxx shall, promptly upon receipt thereof,
furnish to the Bank a copy of each other report submitted to its board of
directors by its independent accountants in connection with any annual, interim
or special audit made by them of the financial records of Xxxxxx.
(b) Quarterly Statements. No later than forty-five (45) calendar days
after the end of each Fiscal Quarter of each Fiscal Year, the consolidated and
consolidating balance sheet and related statements of operations, shareholders'
equity and cash flows of Xxxxxx for such quarterly period and for the period
from the beginning of such fiscal year to the end of such Fiscal Quarter and a
corresponding financial statement for the same periods in the preceding Fiscal
Year certified by the chief financial officer of Xxxxxx as having been prepared
in accordance with GAAP (subject to changes resulting from audits and year-end
adjustments); provided, however, that if the independent certified public
accountants issue a review report on the quarterly financial statements of
Xxxxxx, the financial statements required by this subsection (b) shall be
accompanied by a certificate signed by such accountants either stating that
during the course of their examination nothing came to their attention which
would cause them to believe that any event has occurred and is continuing which
constitutes an Event of Default or Potential Default, or describing each such
event and the remedial steps being taken by Xxxxxx. Such quarterly statement
shall be accompanied by a Compliance Certificate in the form attached hereto as
Exhibit D or such other form as the Bank shall reasonably request.
(c) No Default. Within forty-five (45) calendar days after the end of
each of the first three Fiscal Quarters of each Fiscal Year and within one
hundred and twenty (120) calendar days after the end of each Fiscal Year, a
certificate signed by the chief financial officer of Xxxxxx certifying that, to
the best of such officer's knowledge, after due inquiry, (i) Xxxxxx each has
complied with all covenants, agreements and conditions in each Loan Document and
that each representation and warranty contained in each Loan
Dated
Credit Agreement - 18 - June 12, 1997
Document is true and correct with the same effect as though each such
representation and warranty had been made on the date of such certificate
(except to the extent such representation or warranty related to a specific
prior date), and (ii) no event has occurred and is continuing which constitutes
an Event of Default or Potential Default, or describing each such event and the
remedial steps being taken by Xxxxxx, as applicable.
(d) ERISA. All reports and forms filed with respect to all Plans,
except as filed in the normal course of business and that would not result in an
adverse action to be taken under ERISA, and details of related information of a
Reportable Event, promptly following each filing.
(e) Material Changes. Notification to the Bank of any litigation,
administrative proceeding, investigation, business development, or change in
financial condition which could reasonably have a Material Adverse Effect,
promptly following its discovery.
(f) Other Information. Promptly, upon request by the Bank from time to
time (which may be on a monthly or other basis), Xxxxxx shall provide such other
information and reports regarding its operations, business affairs, prospects
and financial condition as the Bank may reasonably request.
(g) Borrowing Base Certificates. In the event Xxxxxx shall not have
delivered a Borrowing Base Certificate to the Bank during an calendar month, it
will deliver to the Bank, no later than 15 days after the end of such calendar
month as of the last day of the preceding calendar month, a Borrowing Base
Certificate signed by the chief financial officer, treasurer or controller of
Xxxxxx.
(h) Monthly Lease Portfolio and Receivables Report. As soon as
practicable and in any event within 15 days after the end of each calendar
month, Xxxxxx will deliver to the Bank a lease portfolio listing and lease
receivables aging report (in form and substance reasonably satisfactory to
CoreStates).
(i) Maintenance of Current Depreciation Policies. Xxxxxx shall maintain
its method of depreciating its assets substantially consistent with past
practices as set forth in Exhibit E and will promptly notify the Bank of any
deviation from such practices.
(j) Monthly Lease Receipts Report. Within 15 days after the end of each
calendar month following the Revolver Termination Date and until the Note is
paid in full, Xxxxxx shall deliver to the Bank a report setting forth the items
of Collateral on lease and amounts received with respect to each such item of
Collateral.
5.2. Corporate Existence. Preserve its corporate existence and all
material franchises, licenses, patents, copyrights, trademarks and trade names
consistent with good business practice; and maintain, keep, and preserve all of
its properties (tangible and intangible) necessary or useful in the conduct of
its business in good working order and condition, ordinary wear and tear
expected.
5.3. ERISA. Comply in all material respects with the provisions of ERISA
to the extent applicable to any Plan maintained for the employees of Xxxxxx or
any ERISA Affiliate; do or cause to be done all such acts and things that are
required to maintain the qualified status of each Plan and tax exempt status of
each trust forming part of such Plan; not incur any material accumulated funding
deficiency (within the meaning of ERISA and the regulations promulgated
thereunder), or any material liability to the PBGC (as
Dated
Credit Agreement - 19 - June 12, 1997
established by ERISA); not permit any event to occur as described in ss.4042 of
ERISA or which may result in the imposition of a lien on its properties or
assets; notify the Bank in writing promptly after it has come to the attention
of senior management of Xxxxxx of the assertion or threat of any "reportable
event" or other event described in ss.4042 of ERISA (relating to the soundness
of a Plan) or the PBGC's ability to assert a material liability against it or
impose a lien on its, or any ERISA Affiliates', properties or assets; and
refrain from engaging in any Prohibited Transactions or actions causing possible
liability under ss.5.02 of ERISA.
5.4. Compliance with Regulations. Comply in all material respects with
all Regulations applicable to its business, the noncompliance with which
reasonably could have a Material Adverse Effect.
5.5. Conduct of Business; Permits and Approvals, Compliance with Laws.
Continue to engage in an efficient and economical manner in a business of the
same general type as conducted by it on the date of this Agreement; maintain in
full force and effect, its franchises, and all licenses, patents, trademarks,
trade names, contracts, permits, approvals and other rights necessary to the
profitable conduct of its business.
5.6. Maintenance of Properties. Xxxxxx will maintain or cause to be
maintained in good repair, working order and condition all properties used or
useful in its business and make all reasonable and necessary renewals,
replacements, additions, betterments and improvements thereof and thereto, so
that the business carried on in connection therewith may be conducted in the
ordinary course at all times.
5.7. Ownership; Management. At least 50.1% of the common stock of Xxxxxx
shall continue to be owned of record and beneficially by Xxxxxxx X. Xxxxxx or
CFW Partners, L.P., a limited partnership. Further, Xxxxxxx X. Xxxxxx shall
continue to be Chief Executive Officer of Xxxxxx and Xxxxxx X. Xxxxxxxxx shall
continue to be Senior Vice President of Capital Markets of Xxxxxx.
5.8. Maintenance of Insurance. Maintain insurance with financially sound
and reputable insurance companies or associations in such amounts and covering
such risks as are usually carried by companies engaged in the same or a similar
business and similarly situated, which insurance may provide for reasonable
deductibility from coverage thereof.
5.9. Payment of Debt; Payment of Taxes, Etc. Where the amount involved
exceeds $250,000 or where the non-payment or non-discharge would otherwise have
a Material Adverse Effect on Xxxxxx or any of its assets: promptly pay and
discharge (a) all of its Debt in accordance with the terms thereof; (b) all
taxes, assessments, and governmental charges or levies imposed upon it or upon
its income and profits, upon any of its property, real, personal or mixed, or
upon any part thereof, before the same shall become in default; (c) all lawful
claims for labor, materials and supplies or otherwise, which, if unpaid, might
become a lien or charge upon such property or any part thereof; provided,
however, that so long as Xxxxxx first notifies the Bank of its intention to do
so, Xxxxxx shall not be required to pay and discharge any such Debt, tax,
assessment, charge, levy or claim so long as the failure to so pay or discharge
does not constitute or result in an Event of Default or a Potential Default
hereunder and so long as no foreclosure or other similar proceedings shall have
been commenced against such property or any part thereof and so long as the
validity thereof shall be contested in good faith by appropriate proceedings
diligently pursued and it shall have set aside on its books adequate reserves
with respect thereto.
Dated
Credit Agreement - 20 - June 12, 1997
5.10. Notice of Events. Promptly upon discovery of any of the following
events, Xxxxxx shall provide telephone notice to the Bank (confirmed within
three (3) calendar days by written notice), describing the event and all action
Xxxxxx proposes to take with respect thereto:
(a) an Event of Default or Potential Default under this Agreement or
any other Loan Document;
(b) any default or event of default under a contract or contracts and
the default or event of default involves payments by Xxxxxx in an aggregate
amount equal to or in excess of $250,000;
(c) a default or event of default under or as defined in any evidence
of or agreements for Indebtedness for Borrowed Money under which Xxxxxx'x
liability is equal to or in excess of $250,000, singularly or in the aggregate,
whether or not an event of default thereunder has been declared by any party to
such agreement or any event which, upon the lapse of time or the giving of
notice or both, would become an event of default under any such agreement or
instrument or would permit any party to any such instrument agreement to
terminate or suspend any commitment to lend to Xxxxxx or to declare or to cause
any such indebtedness to be accelerated or payable before it would otherwise be
due;
(d) the institution of, any material adverse determination in, or the
entry of any default judgment or order or stipulated judgment or order in, any
suit, action, arbitration, administrative proceeding, criminal prosecution or
governmental investigation against Xxxxxx in which the amount in controversy is
in excess of $250,000, singularly or in the aggregate; or
(e) any change in any Regulation, including, without limitation,
changes in tax laws and regulations, which would have a Material Adverse Effect.
5.11. Inspection Rights. At any time during the existence of an Event of
Default or Potential Default, during regular business hours and then as often as
requested of Xxxxxx by the Bank, permit the Bank, or any authorized officer,
employee, agent, or representative of the Bank to examine and make abstracts
from the records and books of account of Xxxxxx, wherever located, and to visit
the properties of Xxxxxx; and to discuss the affairs, finances, and accounts of
Xxxxxx with its Chairman, President, any executive vice president, it chief
financial officer, treasurer, controller or independent accountants. If no Event
of Default or Potential Default shall be in existence, the Bank shall limit such
examination to once each calendar year. Xxxxxx shall reimburse the Bank up to
$5,000 promptly following the completion of each such examination. In the
inspection shall be made during the continuance of a Potential Default or an
Event of Default, Xxxxxx shall reimburse the Bank for the Bank's reasonable
out-of-pocket expense of such inspection. At all times, it is understood and
agreed by Xxxxxx that all expenses in connection with any such inspection which
may be incurred by Xxxxxx, any officers and employees thereof and the attorneys
and independent certified public accountants therefor shall be expenses payable
by Xxxxxx and shall not be expenses of the Bank.
5.12. Generally Accepted Accounting Principles. Maintain books and
records at all times in accordance with Generally Accepted Accounting
Principles.
5.13. Compliance with Material Contracts. Xxxxxx will comply in all
material respects with all obligations, terms, conditions and covenants, as
applicable, in all Debt of Xxxxxx and all instruments and agreements related
thereto, and all other instruments and agreements to which it is a party or by
which it
Dated
Credit Agreement - 21 - June 12, 1997
is bound or any of its properties is affected and in respect of which the
failure to comply reasonably could have a Material Adverse Effect.
5.14. Use of Proceeds. Xxxxxx will use the proceeds of any Loan made
pursuant hereto for the purchase of Equipment as provided herein.
5.15. Further Assurances. Do such further acts and things and execute
and deliver to the Bank such additional assignments, agreements, powers and
instruments, as the Bank may reasonably require or reasonably deem advisable to
carry into effect the purposes of this Agreement or to better assure and confirm
unto the Bank its rights, powers and remedies hereunder.
6. Negative Covenants
Xxxxxx covenants and agrees that, without the prior written consent of
the Bank, from and after the date hereof and so long as Obligation remains
unpaid or outstanding, it will not:
6.1. Consolidation and Merger. Merge or consolidate with or into any
corporation except, if (1) no Potential Default or Event of Default shall have
occurred and be continuing either immediately prior to or upon the consummation
of such transaction, and (2) Xxxxxx is the surviving entity.
6.2. Liens. Create, assume or permit to exist any Lien on any of its
property or assets, whether now owned or hereafter acquired, or upon any income
or profits therefrom, except Permitted Liens.
6.3. Guarantees. Guarantee or otherwise in any way become or be
responsible for indebtedness or obligations (including working capital
maintenance, take-or-pay contracts) of any unconsolidated Person, contingently
or otherwise. Notwithstanding the preceding sentence, Xxxxxx may guarantee
indebtedness or obligations of unconsolidated Affiliates in amounts not to
exceed $15,000,000 in the aggregate, in the ordinary course of business with the
prior written consent of the Bank, which consent not to be unreasonably
withheld.
6.4. Margin Stock. Use or permit any proceeds of the Loans to be used,
either directly or indirectly, for the purpose, whether immediate, incidental or
ultimate, of buying or carrying margin stock within the meaning of Regulation U
of The Board of Governors of the Federal Reserve System, as amended from time to
time.
6.5. Acquisitions and Investments. If an Event of Default or a Potential
Default exists or would exist immediately thereafter: purchase or otherwise
acquire (including without limitation by way of share exchange) any part or
amount of the capital stock or assets of, or make any Investments in any other
Person; or enter into any new business activities or ventures not directly
related to its present business; or create any Subsidiary, except (a) it may
acquire and hold stock, obligations or securities received in settlement of
debts (created in the ordinary course of business) owing to it, and (b) it may
make and own (i) Investments in certificates of deposit or time deposits having
maturities in each case not exceeding one year from the date of issuance thereof
and issued by Bank, or any FDIC-insured commercial bank incorporated in the
United States or any state thereof having a combined capital and surplus of not
less than $150,000,000, (ii) Investments in marketable direct obligations issued
or unconditionally guaranteed by the United States
Dated
Credit Agreement - 22 - June 12, 1997
of America, any agency thereof, or backed by the full faith and credit of the
United States of America, in each case maturing within one year from the date of
issuance or acquisition thereof, (iii) Investments in commercial paper issued by
a corporation incorporated in the United States or any State thereof maturing no
more than one year from the date of issuance thereof and, at the time of
acquisition, having a rating of A-1 (or better) by Standard & Poor's Corporation
or P-1 (or better) by Xxxxx'x Investors Service, Inc., and (iv) Investments in
money market mutual funds all of the assets of which are invested in cash or
investments described in the immediately preceding clauses (i), (ii) and (iii).
6.6. Transfer of Assets; Nature of Business. Xxxxxx may not sell,
transfer, lease or dispose of assets constituting more than twenty percent (20%)
of its assets during any twelve month period without the written consent of
CoreStates, such consent not to be unreasonably withheld. Notwithstanding the
above, (1) Xxxxxx may sell, transfer, pledge, assign, re-lease or otherwise
dispose of any equipment coming off lease if such sale or disposition is in the
ordinary course of its business, (2) Xxxxxx may sell individual or small groups
of leases and related equipment from time to time and sell groups of leases in
securitization transactions and (3) Xxxxxx may engage in the nonrecourse or
partial recourse financing of leases. Xxxxxx may not discontinue, liquidate or
change in any material respect any substantial part of its operations or
business.
6.7. Accounting Change. Without the prior written approval of
CoreStates, make or permit any material change in financial accounting policies
or financial reporting practices, except as required by Generally Accepted
Accounting Principles or regulations of the Securities and Exchange Commission,
if applicable.
6.8 Transactions with Affilates. Enter into any material transaction
(including, without limitation, the purchase, sale or exchange of property, the
rendering of any services or the payment of management fees) with any Affiliate,
except transactions in the ordinary course of, and pursuant to the reasonable
requirements of, its business, and in good faith and upon commercially
reasonable terms.
6.9. Restriction on Amendment of This Agreement. Enter into or otherwise
become subject to or suffer to exist any agreement which would require it to
obtain the consent of any other person as a condition to the ability of
CoreStates and Xxxxxx to amend or otherwise modify this Agreement.
7. Financial Covenants
7.1. No losses. From and after April 1, 1997, Xxxxxx shall not at any
time suffer a net loss for the four (4) most - recently ended consecutive Fiscal
Quarters.
7.2. Minimum Tangible Net Worth. Tangible Net Worth will not at any time
be less than $19,000,000.
7.3. Debt to Tangible Net Worth. From and after April 1, 1997, the ratio
of Debt (including, without limitation, Debt represented by the Note) to
Tangible Net Worth will not exceed 6.00:1 as at the end of any fiscal quarter.
7.4. Minimum Interest Expense Coverage. From and after April 1, 1997,
the ratio of EBIT to interest for the four (4) most recently ended consecutive
Fiscal Quarters will not be less than 1.25:1.
Dated
Credit Agreement - 23 - June 12, 1997
7.5. Borrowing Base. The aggregate principal amount of Loans outstanding
shall not at any time exceed the Borrowing Base or the Revolving Loan
Commitment, whichever is less; provided, however, that this covenant shall not
be deemed breached if, at the time such aggregate amount exceeds said level,
within four Business Days after the earlier of the date Xxxxxx first has
knowledge of such excess or the date of the next Borrowing Base Certificate
disclosing the existence of such excess, a prepayment of Loans shall be made in
an amount sufficient to assure continued compliance with this covenant in the
future.
8. Default
8.1. Events of Default. Xxxxxx shall be in default if any one or more of
the following events (each an "Event of Default") occurs:
(a) Payments. Xxxxxx fails to pay any principal of or interest on the
Revolving Credit Note when due and payable within five Business Days of
the due date (whether at maturity, by notice of intention to prepay, or
otherwise) or fails to pay when it is due and payable any other amount
payable under any Loan Document and such failure shall continue for a
period of five Business Days or more.
(b) Covenants. Xxxxxx fails to observe or perform (1) within fifteen
days after receiving written notice from the Bank, any term, condition
or covenant set forth in ss.ss.5.1(a), 5.1(b), 5.1(c), 5.1(g), 5.1(h) or
5.1(i) herein, (2) any term, condition or covenant set forth in ss.5.2 ,
ss.ss.6.1 through 6.9 or ss.8.1(a) herein, as and when required or (3)
any term, condition or covenant contained in this Agreement or any other
Loan Document other than as set forth in (1) and (2) above, as and when
required and such failure shall continue for a period of 10 Business
Days or more.
(c) Representations, Warranties. Any representation or warranty made or
deemed to be made by Xxxxxx, as applicable, herein or in any Loan
Document or in any exhibit, schedule, report or certificate delivered
pursuant hereto or thereto shall prove to have been false, misleading or
incorrect in any material respect when made or deemed to have been made.
(d) Bankrupcy. Xxxxxx is dissolved or liquidated, makes an assignment
for the benefit of creditors, files a petition in bankruptcy, is
adjudicated insolvent or bankrupt, petitions or applies to any tribunal
for any receiver or trustee, commences any proceeding relating to itself
under any bankruptcy, reorganization, readjustment of debt, dissolution
or liquidation law or statute of any jurisdiction, has commenced against
it any such proceeding which remains undismissed for a period of thirty
(60) days, or indicates its consent to, approval of or acquiescence in
any such proceeding, or any receiver of or trustee for Xxxxxx or any
substantial part of the property of Xxxxxx is appointed, or if any such
receivership or trusteeship to continues undischarged for a period of
thirty (60) days.
(e) Certian Other Defaults. Xxxxxx shall fail to pay when due any
Indebtedness for Borrowed Money which singularly or in the aggregate
exceeds $5,000,000, and such failure shall continue beyond any
applicable cure period, or Xxxxxx shall suffer to exist any default or
event of default in the performance or observance, subject to any
applicable grace period, of any agreement, term,
Dated
Credit Agreement - 24 - June 12, 1997
condition or covenant with respect to any agreement or document relating
to Indebtedness for Borrowed Money if the effect of such default is to
permit, with the giving of notice or passage of time or both, the
holders thereof, or any trustee or agent for said holders, to terminate
or suspend any commitment (which is equal to or in excess of $5,000,000)
to lend money or to cause or declare any portion of any borrowings
thereunder to become due and payable prior to the date on which it would
otherwise be due and payable, provided that during any applicable cure
period the Bank's obligations hereunder to make further Loans shall be
suspended.
(f) Judgments. Any judgments against Xxxxxx or against its assets or
property for amounts in excess of $5,000,000 in the aggregate remain
unpaid, unstayed on appeal, undischarged, unbonded and undismissed for a
period of thirty (30) days.
(g) Attachments. Any assets of Xxxxxx shall be subject to attachments,
levies, or garnishments for amounts in excess of $250,000 in the
aggregate which have not been dissolved or satisfied within twenty (20)
days after service of notice thereof to Xxxxxx.
(h) Change in Control. Xxxxxxx X. Xxxxxx or the CFW Partners, L.P.
limited partnership, shall cease to be the record and beneficial owner
of at least 50.1% of the issued and outstanding voting and capital stock
of Xxxxxx.
(i) Security Interests. Any security interest created pursuant to any
Loan Document shall cease to be in full force and effect, or shall cease
in any material respect to give the Bank, the Liens, rights, powers and
privileges purported to be created thereby (including, without
limitation, a perfected security interest in, and Lien on, all of the
Collateral), superior to and prior to the rights of all third Persons,
and subject to no other Liens (except as permitted by ss.6.2).
THEN and in every such event other than that specified in ss.8.1.(d), the Bank
may immediately terminate the Revolving Loan Commitment by notice in writing to
Xxxxxx and immediately declare the Revolving Credit Note, including without
limitation accrued interest, to be, and they shall thereupon forthwith become
due and payable without presentment, demand, or notice of any kind, all of which
are hereby expressly waived by Xxxxxx. Upon the occurrence of any event
specified in ss.8.1.(d), the Revolving Loan Commitment shall automatically
terminate and the Revolving Credit Note, including without limitation accrued
interest, shall immediately be due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby expressly waived by
Xxxxxx. Any date on which the Loans and such other Obligations are declared due
and payable pursuant to this ss.8.1, shall be the Revolver Termination Date for
purposes of this Agreement. From and after the date an Event of Default shall
have occurred and for so long as an Event of Default shall be continuing, the
Loans shall bear interest at the Default Rate.
Dated
Credit Agreement - 25 - June 12, 1997
9. Collateral
9.1. Collateral. Except as otherwise specifically set forth herein or in
any other Loan Document, any Loans made and outstanding and their repayment at
all times shall (i) in the case of Collateral (as defined in the Security
Agreement, hereinafter referred to as the "Collateral") located in the United
States, be secured by a first priority perfected security interest and (ii) in
the case of Collateral located in jurisdictions outside the United States, be
secured by a security interest, which in the determination of the Bank,
adequately protects the first priority security interest in favor of the Bank.
9.2. Security Agreement. As security for the punctual payment in full of
all Loans (including all payments of principal, and interest and other costs
contemplated hereby), Xxxxxx at or prior to the funding of the first Loan
hereunder shall execute and deliver to CoreStates the Security Agreement and
such other documents as may be necessary to constitute and evidence a security
interest in the Collateral.
9.3. Prepayments and Release of Collateral.
(a) Category A Equipment Held For Sale or Subject To Lease. In the event
Xxxxxx wishes to sell, or otherwise remove from the Borrowing Base any item of
Equipment it shall pay to CoreStates an amount equal to 85% of the acquisition
cost of the Equipment (or 85% of the net book value of the Equipment, as
applicable) as shown on the books and records of Xxxxxx, in which case
CoreStates shall release its Lien in said Equipment and any related lease.
(b) Category A Equipment Not Subject to Lease; Held for Greater Than
Nine Months. In the event any item of Category A Equipment shall have been
purchased and held for greater than nine months, Xxxxxx shall pay to CoreStates
an amount equal to 85% of the acquisition cost of the Equipment (or 85% of the
net book value, as applicable), as shown on the books and records of Xxxxxx, in
which case CoreStates shall release its Lien in said Equipment.
(c) Category B(1) Equipment. In the event any item of Category B(1)
Equipment shall have been purchased and held for greater than nine months or any
engine shall be removed from such item of Category B(1) Equipment, Xxxxxx shall
pay to CoreStates an amount equal to 85% of the acquisition cost of the
Equipment (or 85% of the net book value of the Equipment, as applicable), as
shown on the books and records of Xxxxxx, in which case CoreStates shall release
its Lien in said Equipment.
(d) Category B(2) Equipment. In the event any item of Category B(2)
Equipment shall cease to be the subject of an Eligible Lease, Xxxxxx shall pay
to CoreStates an amount equal to 85% of the acquisition cost of the Equipment
(or 85% of the net book value of the Equipment, as applicable), as shown on the
books and records of Xxxxxx, in which case CoreStates shall release its Lien in
said Equipment and in the related lease.
(e) Event of Default or Potential Default. Notwithstanding the above, if
at the time of such sale or removal of such Equipment from the Borrowing Base
pursuant to subsections (a) through (d) of this section, there is then existing
an Event of Default or Potential Default, Xxxxxx shall pay to CoreStates (1) in
the event Xxxxxx has sold any item of Equipment as described in this ss.9.3, all
proceeds from such sale, or (2) in the event such Equipment has otherwise been
removed from the Borrowing Base as described in
Dated
Credit Agreement - 26 - June 12, 1997
this ss.9.3, 100% of the acquisition cost of the Equipment (or 100% of the net
book value of the Equipment, as applicable).
10. Miscellaneous
10.1. Waiver. No failure or delay on the part of the Bank or any holder
of the Note in exercising any right, power or remedy under any Loan Document
shall operate as a waiver thereof; nor shall any single or partial exercise of
any such right, power or remedy preclude any other or further exercise thereof
or the exercise of any other right, power or remedy under any Loan Document. The
remedies provided under the Loan Documents are cumulative and not exclusive of
any remedies provided by law.
10.2. Amendments. No amendment, modification, termination or waiver of
any Loan Document or any provision thereof nor any consent to any departure by
Xxxxxx therefrom shall be effective unless the same shall have been approved in
writing by the Bank, be in writing and be signed by the Bank and Xxxxxx and then
any such waiver or consent shall be effective only in the instance and for the
specific purpose for which given. No notice to or demand on the Xxxxxx shall
entitle Xxxxxx to any other or further notice or demand in similar or other
circumstances.
10.3. Governing Law. The Loan Documents and all rights and obligations
of the parties thereunder shall be governed by and be construed and enforced in
accordance with the laws of the Commonwealth of Pennsylvania without regard to
Pennsylvania or federal principles of conflict of laws.
10.4. Participations and Assignments. Xxxxxx hereby acknowledges and
agrees that CoreStates may at any time, with the consent of Xxxxxx (which
consent shall not be unreasonably withheld): (a) grant participations in all or
any portion of its Revolving Loan Commitment or any portion of the Note or of
its right, title and interest therein or in or to this Agreement (collectively,
"Participations") to any other lending office of the CoreStates or to any other
bank, lending institution or other entity which has the requisite sophistication
to evaluate the merits and risks of investments in Participations
("Participants"); provided, however, that: (i) all amounts payable by Xxxxxx
hereunder shall be determined as if CoreStates had not granted such
Participation; (ii) CoreStates shall act as agent for all Participants; and
(iii) any agreement pursuant to which CoreStates may grant a Participation: (x)
shall provide that CoreStates shall retain the sole right and responsibility to
enforce the obligations of Xxxxxx hereunder including, without limitation, the
right to approve any amendment, modification or waiver of any provisions of this
Agreement; (y) such participation agreement may provide that CoreStates will not
agree to any modification, amendment or waiver of this Agreement without the
consent of the Participant if such modification, amendment or waiver would
reduce the principal of or rate of interest on any Loan or postpone the date
fixed for any payment of principal of or interest on any Loan; and (z) shall not
relieve CoreStates from its obligations, which shall remain absolute, to make
Loans hereunder; and (b) assign any of its Loans and its Revolving Loan
Commitment. Upon execution and delivery by the assignee to Xxxxxx of an
instrument in writing pursuant to which such assignee agrees to become a "Bank"
hereunder having the Revolving Loan Commitment and Loans specified in such
instrument, and upon consent thereto by Xxxxxx, to the extent required above,
the assignee shall have, to the extent of such assignment (unless otherwise
provided in such assignment with the consent of the Xxxxxx), the obligations,
rights and benefits of a Bank hereunder holding the Revolving Loan Commitment
and Loans (or portions thereof) assigned to it, and CoreStates Bank shall, to
the extent of such assignment, be released from the Commitment (or portion(s)
thereof) so assigned.
Dated
Credit Agreement - 27 - June 12, 1997
10.5. Captions. Captions in the Loan Documents are included for
convenience of reference only and shall not constitute a part of any Loan
Document for any other purpose.
10.6. Notices. All notices, requests, demands, directions, declarations
and other communications between the Bank and the Xxxxxx provided for in any
Loan Document shall, except as otherwise expressly provided, be mailed by
registered or certified mail, return receipt requested, or telegraphed, or
faxed, or delivered in hand to the applicable party at its address indicated
opposite its name on the signature pages hereto. The foregoing shall be
effective and deemed received three days after being deposited in the mails,
postage prepaid, addressed as aforesaid and shall whenever sent by telegram,
telegraph or fax or delivered in hand be effective when received. Any party may
change its address by a communication in accordance herewith.
10.7. Expenses; Indemnification. Xxxxxx will from time to time reimburse
the Bank promptly following demand for all reasonable out-of-pocket expenses
(including the reasonable fees and expenses of legal counsel) in connection with
(i) the preparation of the Loan Documents (subject to a maximum amount of
$25,000 in the case of fees of legal counsel, (ii) the making of any Loans and
(iii) the administration of the Loan Documents; and reimburse the Bank for all
out-of-pocket expenses (including reasonable fees and expenses of legal counsel)
in connection with the enforcement of the Loan Documents. In addition to the
payment of the foregoing expenses, Xxxxxx hereby agrees to indemnify, protect
and hold the Bank and any holder of the Note and the officers, directors,
employees, agents, affiliates and attorneys of the Bank and such holder
(collectively, the "Indemnitees") harmless from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses and disbursements of any kind or nature, including reasonable
fees and expenses of legal counsel, which may be imposed on, incurred by, or
asserted against such Indemnitee by Xxxxxx or other third parties and arise out
of or relate to this Agreement or the other Loan Documents or any other matter
whatsoever related to the transactions contemplated by or referred to in this
Agreement or the other Loan Documents; provided, however, that Xxxxxx shall have
no obligation to an Indemnitee hereunder to the extent that the liability
incurred by such Indemnitee has been determined by a court of competent
jurisdiction to be the result of gross negligence or willful misconduct of such
Indemnitee.
10.8. Survival of Warranties and Certain Agreements. All agreements,
representations and warranties expressly made herein shall survive the execution
and delivery of this Agreement, the making of the Loans hereunder and the
execution and delivery of the Note. Notwithstanding anything in this Agreement
or implied by law to the contrary, the agreements of Xxxxxx set forth in ss.10.7
shall survive the payment of the Loans and the termination of this Agreement.
This Agreement shall remain in full force and effect until the repayment in full
of all amounts owed by Xxxxxx under the Note or any other Loan Document.
10.9. Severability. The invalidity, illegality or unenforceability in
any jurisdiction of any provision in or obligation under this Agreement, the
Note or other Loan Documents shall not affect or impair the validity, legality
or enforceability of the remaining provisions or obligations under this
Agreement, the Note or other Loan Documents or of such provision or obligation
in any other jurisdiction.
10.10. No Fiduciary Relationship. No provision in this Agreement or in
any of the other Loan Documents and no course of dealing between the parties
shall be deemed to create any fiduciary duty by the Bank to Xxxxxx.
Dated
Credit Agreement - 28 - June 12, 1997
10.11. CONSENT TO JURISDICTION AND SERVICE OF PROCESS. XXXXXX AND
CORESTATES EACH HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR FEDERAL
COURT LOCATED WITHIN THE EASTERN DISTRICT OF PENNSYLVANIA AND IRREVOCABLY AGREES
THAT, ANY ACTIONS OR PROCEEDINGS ARISING OUT OF OR RELATING TO THE NOTE, THIS
AGREEMENT OR THE OTHER LOAN DOCUMENTS MAYBE LITIGATED IN SUCH COURTS. EACH PARTY
TO THIS AGREEMENT ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES,
GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE AFORESAID
COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENT, AND IRREVOCABLY AGREES TO
BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS AGREEMENT, ANY
NOTE, OR SUCH OTHER LOAN DOCUMENT.
10.12. WAIVER OF JURY TRIAL. XXXXXX AND CORESTATES EACH HEREBY WAIVES
ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF THIS AGREEMENT, ANY OF THE LOAN DOCUMENTS, OR ANY DEALINGS
BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT AND THE
LENDER/BORROWER RELATIONSHIP ESTABLISHED HEREBY. THE SCOPE OF THIS WAIVER IS
INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY
COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING
WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL
OTHER COMMON LAW AND STATUTORY CLAIMS. XXXXXX AND CORESTATES EACH ACKNOWLEDGES
THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO THE TRANSACTION, THAT EACH HAS
ALREADY RELIED ON THE WAIVER IN ENTERING INTO THIS AGREEMENT AND THAT EACH WILL
CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED FUTURE DEALINGS. XXXXXX AND
CORESTATES EACH FURTHER WARRANTS AND REPRESENTS THAT EACH HAS REVIEWED THIS
WAIVER WITH ITS LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES
ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS
IRREVOCABLE, AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS, MODIFICATIONS, REPLACEMENTS OR RESTATEMENTS TO THIS AGREEMENT, THE
LOAN DOCUMENTS, OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS.
IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO
A TRIAL BY THE COURT.
10.13. Counterparts; Effectiveness. This Agreement and any amendment
hereto or waiver hereof may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument. This Agreement and any amendments
hereto or waivers hereof shall become effective when the Bank shall have
received signed counterparts or notice by fax of the signature page that the
counterpart has been signed and is being delivered to it or facsimile that such
counterparts have been signed by all the parties hereto or thereto.
10.14. Use of Defined Terms. All words used herein in the singular or
plural shall be deemed to have been used in the plural or singular where the
context or construction so requires. Any defined term used in the singular
preceded by "any" shall be taken to indicate any number of the members of the
relevant class.
Dated
Credit Agreement - 29 - June 12, 1997
10.15. Offsets. Nothing in this Agreement shall be deemed a waiver or
prohibition of the Bank's right of banker's lien or offset.
10.16 Entire Agreement. This Agreement, the Note issued hereunder and
the other Loan Documents constitute the entire understanding of the parties
hereto as of the date hereof with respect to the subject matter hereof and
thereof and supersede any prior agreements, written or oral, with respect hereto
or thereto.
Dated
Credit Agreement - 30 - June 12, 1997
IN WITNESS WHEREOF, the parties hereto have each caused this Agreement
to be duly executed by their duly authorized representatives as of the date
first above written.
XXXXXX LEASE FINANCE CORPORATION
By /s/ Xxxxxxx X. Xxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President / CFO
Notices To:
Xxxxxx X. Xxxxxxxxx
Senior Vice President-Capital Markets
000 Xxxxxx Xxxxx
Xxxxx 000
Xxxxxxxxx, XX 00000
CORESTATES BANK, N.A.
By /s/ Xxxx Xxxxxxxx
-----------------------------
Name: Xxxx X. Xxxxxxxx
Title: Vice President
Notices To:
Xxxx X. Xxxxxxxx
Vice President
CoreStates Bank, N.A.
Transportation and Leasing Division
FC 1-8-11-24
0000 Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
FAX No. (000) 000-0000
Dated
Credit Agreement - 31 - June 12, 1997
Reference Table of Definitions
definition page defined
Affiliate......................................................................1
Agreement......................................................................1
Agreement Year.................................................................9
Bank...........................................................................1
Borrowing Base.................................................................1
Borrowing Base Certificate.....................................................2
Business Day...................................................................2
Capitalized Lease..............................................................2
Capitalized Lease Obligations..................................................2
Category A Equipment...........................................................2
Category B Equipment...........................................................2
Closing Date...................................................................2
Closing Fee...................................................................11
Code...........................................................................2
Collateral.....................................................................2
Compliance Certificate.........................................................2
CoreStates.....................................................................1
CoreStates Bank................................................................1
Debt...........................................................................3
Debt Service...................................................................3
Default Rate...................................................................3
Dollars........................................................................3
EBIT...........................................................................3
Eligible Lease Receivables.....................................................3
Environmental Control Statutes.................................................4
Equipment......................................................................4
ERISA..........................................................................4
ERISA Affiliate................................................................4
Event of Default...............................................................4
Fiscal Quarter.................................................................4
Fiscal Year....................................................................4
GAAP...........................................................................4
Generally Accepted Accounting Principles.......................................4
Governmental Authority.........................................................4
Hazardous Substances...........................................................4
Indebtedness for Borrowed Money................................................4
Indemnitees...................................................................28
Intangible Assets..............................................................5
Investment.....................................................................5
Lien...........................................................................5
Loan...........................................................................5
Dated
Credit Agreement - 32 - June 12, 1997
Loan Documents.................................................................5
Loans..........................................................................5
Material Adverse Change........................................................5
Material Adverse Effect........................................................5
Maximum Loan Amount............................................................9
Monthly Lease Portfolio........................................................5
Multiemployer Plan.............................................................6
Net Income.....................................................................6
Net Worth......................................................................6
Note...........................................................................6
Obligations....................................................................6
Participants..................................................................27
Participations................................................................27
PBGC...........................................................................6
Pension Plan...................................................................6
Permitted Liens................................................................6
Person.........................................................................7
Plan...........................................................................7
Potential Default..............................................................7
Prime Rate.....................................................................7
Prohibited Transaction.........................................................7
Receivables Report.............................................................5
Regulation.....................................................................7
Release........................................................................7
Reportable Event...............................................................7
Revolver Termination Date......................................................7
Revolving Credit Loan..........................................................7
Revolving Credit Note..........................................................7
Revolving Loan Commitment......................................................7
Revolving Loan Commitment Fee..................................................8
Security Agreement.............................................................8
Solvent........................................................................8
Standby Letter of Credit.......................................................8
Subsidiary.....................................................................8
Tangible Net Worth.............................................................8
Termination Event..............................................................8
Unfunded Pension Liabilities...................................................8
Unrecognized Retiree Welfare Liability.........................................8
Xxxxxx.........................................................................1
Dated
Credit Agreement - 33 - June 12, 1997
EXHIBIT A
[LOGO] Revolving Credit Note
$15,000,000 Philadelphia, PA
June 12, 1997
For Value Received, XXXXXX LEASE FINANCE CORPORATION, a California corporation
("Xxxxxx"), hereby promises to pay to the order of CORESTATES BANK, N.A. (the
"Bank"), in lawful currency of the United States of America in immediately
available funds at the Bank's offices located at Broad and Chestnut Streets,
Philadelphia, Pennsylvania, on the Revolver Termination Date, or on such earlier
date or dates as provided in the Credit Agreement described below, the principal
sum of FIFTEEN MILLION DOLLARS ($15,000,000) or, if less, the then unpaid
principal amount of all Revolving Credit Loans made by the Bank pursuant to the
Credit Agreement.
Xxxxxx promises also to pay interest on the unpaid principal amount hereof in
like money at such office from the date hereof until paid at the rates and at
the times provided in the Credit Agreement.
This Note is Revolving Credit Note referred to in, is entitled to the benefits
of and is secured by security interests referred to in the Credit Agreement,
dated as of June 12, 1997 by and between Xxxxxx and the Bank (as such may be
amended, modified, supplemented, restated or replaced from time to time, the
"Credit Agreement"). This Note is subject to voluntary prepayment and mandatory
repayment prior to the Revolver Termination Date, in whole or in part, as
provided in the Credit Agreement.
In case an Event of Default shall occur and be continuing, the principal of and
the accrued interest on this Note may be declared to be due and payable in the
manner and with the effect provided in the Credit Agreement.
Xxxxxx hereby waives presentment, demand, protest or notice of any kind in
connection with this Note.
Notwithstanding the face amount of this Note, the undersigned's liability
hereunder shall be limited at all times to the actual aggregate outstanding
indebtedness to the Bank relating to such Bank's Revolving Credit Loans,
including all principal and interest, together with all fees and expenses as
provided in the Credit Agreement, as established by the Bank's books and records
which shall be conclusive absent manifest error.
Capitalized terms used but not defined herein shall have the respective meanings
assigned to them in the Credit Agreement.
Note -1-
THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF
THE COMMONWEALTH OF PENNSYLVANIA WITHOUT REGARD TO PENNSYLVANIA OR FEDERAL
PRINCIPLES OF CONFLICT OF LAWS.
XXXXXX LEASE FINANCE CORPORATION
BY /s/ Xxxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chief Executive Officer
-2-
EXHIBIT B
Borrowing Base Certificate
Date of Certificate: _________________________
Date of Information: _________________________
To: CoreStates Bank, N.A.
Gentlemen:
This Borrowing Base Certificate is delivered to you pursuant to the terms of
ss.5.1 of the Credit Agreement, dated as of June 12, 1997, as currently in
effect. Capitalized terms used without definition below have the same meanings
as they have in the Credit Agreement.
We hereby certify that:
1. No Potential Default or Event of Default has occurred and is continuing
as of the date of this Borrowing Base Certificate.
2. There has been no Material Adverse Change since [insert the date of the
most recent financial statements delivered to the Bank pursuant to the
terms of ss.5.1 of the Credit Agreement], except as disclosed on the
attached schedules.
3. The information set forth on the attached schedules is true, current
and complete as of the date of this Borrowing Base Certificate.
Xxxxxx Lease Finance Corporation
By _____________________________
Name: Xxxxxx X. Xxxxxxx
Title: CFO & Controller
Borrowing Base Certificate -1- Date: ___________
Xxxxxx Lease Finance Corporation
Computation of Borrowing Base Availability
____________________,_________
Collateral Loan Value
1. Equipment (from Schedule A, $_______________
attached hereto)
Maximum Loans
2. Maximum Loans: $15,000,000 $ 15,000,000.00
Credit Usage
3. Aggregate Loan Balance (principal) at date of certificate $_______________
Loan Availability
4. Line 1 minus Line 3 $_______________
5. Line 2 minus Line 3 $_______________
6. Availability (Line 4 or Line 5 whichever is less) $_______________
7. Amount of Loan Requested This Date (if any) $_______________
(Not to exceed line 6)
Certification: Xxxxxx Lease Finance Corporation
Date: ____________________________ By: ___________________________
Name: Xxxxxx X. Xxxxxxx
Title: CFO & Controller
Borrowing Base Certificate -2- Date: ___________
Xxxxxx Lease Finance Corporation
New Collateral Information Schedule
for Borrowing on
_______________,_________
Xxxxxx Lease Finance Corporation has requested this date that a Loan be made to
it by CoreStates Bank, N.A. The following table sets forth information with
respect to items being added to the Collateral with this Request for Loan.
Xxxxxx Lease Finance Corporation has delivered the original counterpart of each
lease to CoreStates Bank, N.A. and it represents and warrants hereby that all
other copies of each lease are clearly marked to indicate that each is not the
lessor's original counterpart of that lease.
Customer Contract Monthly Lease Remaining Gross Equipment
Name Number Payment Term(1) Term(2) Remaining(3) Cost(4)
--------- --------- -------- ------- --------- ------------ ---------
---------- ---------
Totals
Xxxxxx Lease Finance Corporation
By ______________________________
Name: Xxxxxx X. Xxxxxxx
Title: CFO & Controller
1 This is the original term of months of the lease.
2 This is the number of months remaining on the lease at the date of this
Schedule.
3 This is the gross amount remaining payable in respect of the lease minus
the unearned finance charge.
4 This is the purchase price of the equipment to Xxxxxx Corporation as shown
on the invoice of the manufacturer or distributor of the equipment.
