1
EXHIBIT 10.30
ADDENDUM TO AGREEMENT FOR WHOLESALE FINANCING
This Addendum is made to that certain Agreement for Wholesale Financing
entered into by and between M&M Properties, Inc. ("Dealer") and ITT Commercial
Finance Corp. ("ITT") on July 28, 1994, as amended ("Agreement").
FOR VALUE RECEIVED, ITT and Dealer agree as follows:
1. The following section is incorporated into the Agreement as Section 15
as if fully and originally set forth therein:
"Dealer will at all times maintain:
(a) a Tangible Net Worth and Subordinated Debt in the combined amount
of not less than One Million Dollars ($1,000,000.00); and
(b) a ratio of Debt to Tangible Net Worth and Subordinated Debt of not
more than five to one (5.0:1).
For purposes of this paragraph: (1) 'Tangible Net' Worth means the
book value of Dealer's assets less liabilities, excluding from such
assets all Intangibles; (ii) 'Intangibles' means and includes general
intangibles (as that term is defined in the Uniform Commercial Code);
accounts receivable and advances due from officers, directors,
employees, stockholders and affiliates; leasehold improvements net of
depreciation; licenses; good will; prepaid expenses; escrow deposits;
covenants not to compete, the excess of cost over book value of
acquired assets; franchise fees; organizational costs; finance reserves
held for recourse obligations; capitalized research and development
costs; and such other similar items as ITT may from time to time
determine in ITT's sole discretion; (iii) 'Debt' means all of Dealer's
liabilities and indebtedness for borrowed money of any kind and nature
whatsoever, whether direct or indirect, absolute or contingent, and
including obligations under capitalized leases, guaranties or with
respect to which Dealer has pledged assets to secure performance,
whether or not direct recourse liability has been assumed by Dealer;
and (iv) 'Subordinated Debt' means all of Dealer's Debt which is
subordinated to the payment of Dealer's liabilities to ITT by an
agreement in form and substance satisfactory to ITT. The foregoing
terms will be determined in accordance with generally accepted
accounting principles consistently applied, and, if applicable, on a
consolidated basis."
2. Section "1" of the Agreement is hereby deleted in its entirety and
restated to provide as follows:
"1. Inventory Credit Line. In the course of Dealer's business, Dealer
acquires inventory which is manufactured or sold by Skyjack, Inc. and
JLG, Inc. (separately and jointly 'Vendor') or any of its subsidiaries
or affiliated companies, and/or which bears a trademark or trade name
of Vendor or any of its subsidiaries of affiliated companies
('Inventory'). Subject to the terms of this Agreement, ITT, in its
sole discretion, may extend credit to Dealer from time to time to
purchase Inventory from Vendor. ITT may
2
combine all of ITT's advances to Dealer or on Dealer's behalf,
whether under this Agreement or any other agreement, to make one
debt owed by Dealer. ITT's decision to advance funds on any
Inventory will not be binding until the funds are actually
advanced. ITT may, at any time and without notice to Dealer,
elect not to finance any Inventory if Vendor is in default of its
obligations to ITT, or with respect to which ITT reasonably feels
insecure."
3. The following provision is incorporated into Section 7 of the
Agreement as if fully set forth therein:
"With respect to Inventory financed by ITT and held for rent and/or
lease, Dealer will owe ITT and agree to pay ITT monthly the percentage
of the principal balance owed on each item of such Inventory that is
required under the terms of Dealer's financing program with ITT.
However, if any Inventory financed by ITT and held for rent and/or
lease: (A) is sold and Dealer does not receive payment for such item
at the time of sale, Dealer will pay ITT the full amount of the
principal balance owed to ITT on such item of Inventory within thirty
(30) days immediately following the sale date of such item of
Inventory or immediately upon Dealer's receipt of payment for such
item of Inventory, whichever occurs first; or (B) is stolen, destroyed
or otherwise disposed of, Dealer will immediately pay ITT the full
amount of Dealer's outstanding indebtedness owed to ITT for such
Inventory."
4. The following provision is incorporated into Section 9 of the
Agreement as if fully set forth therein:
"(vi) Upon ITT's oral or written demand, Dealer will immediately
deliver the original Rental Contracts to ITT, and ITT may collect in
ITT's name all amounts owed to Dealer under the Rental Contracts."
5. The following provision is incorporated into the Agreement as if fully
set forth therein:
"16. Rental Contracts. Dealer may rent the Inventory pursuant to
the terms of Dealer's rental contracts ("Rental Contracts"). Such
Inventory will thereafter be subject to the rates and terms of ITT's
financing program in effect for goods which are rented, as reflected
in the Statement of Transaction for such Inventory. All of Dealer's
Rental Contracts, agreements, and rental transactions will be in a
form satisfactory to ITT and will be in accordance with all applicable
Federal, State and local laws. Dealer will indemnify ITT against any
loss or damage which ITT suffers, whether direct or indirect,
resulting in any way from the Rental Contracts, agreements, or rental
transactions which fail to comply with such laws. All Rental
Contracts will be transferable to ITT. Dealer will indemnify ITT
against any claims by its customers regarding Dealer's obligations
under the Rental Contracts. Dealer will immediately, upon ITT's
request, deliver to ITT all Rental Contracts and all related
documents. This assignment is a transfer for security only, and, until
ITT has foreclosed its interest in the Rental Contracts, will not be
deemed to delegate any of Dealer's duties under the Rental Contracts
to ITT, nor is it intended to alter or impair
3
performance by either party to the Rental Contracts. ITT may, from
time to time, verify the accuracy of the Rental Contracts, and Dealer
will immediately, upon ITT's request, provide ITT with the following
information regarding Rental Contracts which are in effect on the date
of such request: (a) the name, address and telephone number of each
customer who has executed a Rental Contract; (b) the location of the
Inventory; (c) the date of each Rental Contract; (d) the date when the
Inventory is to be returned under each Rental Contract; and, (e) any
other information which ITT may reasonably request. If the rental
period under the Rental Contract is ninety (90) days or longer, Dealer
will stamp the original of such Rental Contract with the following
legend:
'FOR VALUE RECEIVED, THIS AGREEMENT HAS BEEN ASSIGNED TO ITT
COMMERCIAL FINANCE CORP. AND THERE ARE NO DEFENSES AGAINST THE
ASSIGNEE.'
Other than to ITT, Dealer will not assign, sell, pledge, convey or by
any other means transfer any Rental Contracts or chattel paper,
without ITT's prior written consent. Dealer will not enter into any
Rental Contracts for Inventory pursuant to which: (i) the original
term of the Rental Contract is greater than three hundred sixty (360)
days; (ii) the original term of the Rental Contract is equal to or
greater than the remaining economic life of Inventory; (iii) the
customer is bound to renew the Rental Contract for the economic life
of the Inventory or is bound to become the owner of the Inventory; or,
(iv) the customer has an option to renew the Rental Contract for the
remaining economic life of the Inventory, or to become the owner of
the Inventory, for nominal consideration, or for consideration which
is less than the unpaid balance owed to ITT for such Inventory. If
any such Rental Contracts are issued, Dealer will take any action
which ITT may reasonably require to perfect and/or protect ITT's
security interest in such Rental Contracts and/or the Inventory
subject thereto."
Dealer waives notice of ITT's acceptance of this addendum.
All other terms and provisions of the Agreement, to the extent consistent
with the foregoing, are ratified and remain unchanged and in full force and
effect.
M & M PROPERTIES, INC.
ATTEST:
/s/ Xxxxx Xxxxxxxx By: /s/ Xxxxx XxXxxxx
---------------------------- ------------------------------
(Assistant) Secretary Title: President
---------------------------
JANUARY 3, 1995
ITT COMMERCIAL FINANCE CORP.
By: /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------
Title: Branch Manager
---------------------------
JANUARY 6, 1995
1/6876z/12
