EXHIBIT 10.1
CREDIT AGREEMENT
Dated as of November 3, 2004
among
TRANSAMERICA LEASING INC.,
as a Borrower,
TRANS OCEAN LTD.,
as a Borrower,
TRANS OCEAN CONTAINER CORPORATION,
as a Borrower,
THE LENDERS FROM TIME TO TIME PARTY HERETO,
as Lenders,
and
FORTIS BANK (NEDERLAND) N.V.,
as Administrative Agent
TABLE OF CONTENTS
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1. DEFINITIONS AND RULES OF INTERPRETATION...............................1
1.1. Definitions..................................................1
1.2. Rules of Interpretation.....................................39
2. THE CLOSING DATE ADVANCE AND NEW CONTAINER ADVANCES..................40
2.1. Closing Date Advance........................................40
2.2. Post-Closing Loan...........................................40
2.3. Requests for Loan...........................................40
2.4. The Revolving Credit Notes..................................41
2.5. Termination or Reduction of Commitments.....................41
2.6. Repayment of Principal of Loans.............................42
2.7. Funding by Lenders; Presumption by Administrative Agent.....42
2.8. Failure to Satisfy Conditions Precedent.....................42
2.9. Obligations of Lenders Several..............................43
2.10. Joint and Several Obligation................................43
2.11. Revolving Credit Facility...................................45
3. COLLECTION AND DISBURSEMENTS OF FUNDS................................45
3.1. Trust Account...............................................45
3.2. Concentration Account.......................................46
3.3. Lockbox Accounts............................................47
3.4. Investments.................................................48
3.5. General Provisions Regarding Lockbox Account, Concentration
Account, Accounts Payable Account, Payroll Account and IO
Disbursement Account........................................48
3.6. IO Disbursement Account.....................................49
4. Provisions Applicable to All Loans...................................49
4.1. Interest on Loans...........................................49
4.1.1. Interest Rates.....................................49
4.1.2. Amounts............................................50
4.2. Mandatory Repayments of the Loans...........................50
4.2.1. Repayments in Connection with the Asset Base.......50
4.2.2. Application of Payments............................50
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4.3. Optional Prepayment of Loans................................50
4.4. Payments by Borrower; Presumptions by Administrative Agent..51
4.5. Sharing of Payments by Lenders..............................51
4.6. Funding Source..............................................52
5. CERTAIN GENERAL PROVISIONS...........................................52
5.1. Fees........................................................52
5.1.1. Commitment Fee.....................................52
5.1.2. Other Fees.........................................52
5.2. Funds for Payments..........................................52
5.2.1. Payments to Administrative Agent...................53
5.2.2. No Offset, etc.....................................53
5.2.3. Non-U.S. Lenders...................................54
5.3. Computations................................................56
5.4. Inability to Determine LIBOR Rate...........................56
5.5. Illegality..................................................57
5.6. Additional Costs, etc.......................................57
5.7. Capital Adequacy............................................58
5.8. Certificate.................................................59
5.9. Indemnity...................................................59
5.10. Interest After Default......................................59
6. COLLATERAL SECURITY..................................................60
6.1. Security of Borrowers.......................................60
7. Representations and Warranties.......................................60
7.1. Company Status..............................................60
7.2. Company Power and Authority.................................60
7.3. No Violation................................................61
7.4. Litigation..................................................61
7.5. Use of Proceeds; Margin Regulations.........................61
7.6. Governmental Approvals......................................62
7.7. Investment Company Act......................................62
7.8. Public Utility Holding Company Act..........................62
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7.9. True and Complete Disclosure................................62
7.10. Financial Condition; Financial Statements...................63
7.11. Security Interests..........................................64
7.12. Compliance with ERISA.......................................64
7.13. Subsidiaries................................................64
7.14. Compliance with Statutes; Agreements, etc...................65
7.15. Environmental Matters.......................................65
7.16. Labor Relations.............................................66
7.17. Tax Returns and Payments....................................66
7.18. Scheduled Existing Indebtedness.............................66
7.19. Insurance...................................................66
7.20. Foreign Assets Control Regulations, etc.....................66
7.21. Lockbox Accounts and Payment Instructions...................67
7.22. Credit and Collection Policy................................67
7.23. Form of Lease Agreement.....................................67
7.24. UBS Lease Agreement.........................................67
7.25. Depreciation Policy.........................................67
8. Affirmative Covenants................................................67
8.1. Information Covenants.......................................67
8.2. Books, Records and Inspections..............................70
8.3. Permitted Securitization....................................71
8.4. Payment of Taxes............................................71
8.5. Existence; Franchises.......................................71
8.6. Compliance with Statutes; etc...............................71
8.7. End of Fiscal Years; Fiscal Quarters........................72
8.8. Further Assurances..........................................72
8.9. Use of Proceeds.............................................72
8.10. Performance of Obligations..................................72
8.11. Maintenance of Containers...................................72
8.12. Insurance...................................................73
8.13. Interest Rate Hedging Agreements............................74
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8.14. UNIDROIT Convention.........................................74
8.15. Identification of Gross Lease Revenues and Direct Operating
Expense; Transfer of Gross
Lease Revenues..............................................74
8.16. Compliance with Credit and Collection Policy................74
8.17. Payment Instruction to Lessees..............................74
8.18. Transfer to Special Purpose Vehicles........................74
8.19. Static Storage Containers...................................75
9. Negative Covenants...................................................75
9.1. Changes in Business; etc....................................75
9.2. Consolidation; Merger; Sale or Purchase of Assets; etc......75
9.3. Liens.......................................................77
9.4. Indebtedness................................................79
9.5. Advances; Investments; Loans................................81
9.6. Dividends...................................................83
9.7. Transactions with Affiliates................................83
9.8. Limitation on Certain Restrictions on Subsidiaries..........83
9.9. Change in Credit and Collection Policy......................84
9.10. Change in Payment Instructions to Lessees...................85
9.11. Cost Allocation Methodologies...............................85
9.12. Amendments to Depreciation Policy...........................85
9.13. Limitation on the Creation of Subsidiaries..................85
10. FINANCIAL COVENANTS..................................................85
10.1. Consolidated EBIT to Consolidated Cash Interest Expense
Ratio.......................................................85
11. CLOSING CONDITIONS...................................................86
11.1. Execution of Agreement; Notes...............................86
11.2. Officer's Certificate.......................................86
11.3. Opinions of Counsel.........................................86
11.4. Company Documents; Proceedings..............................86
11.5. Approvals...................................................87
11.6. Consummation of the Transaction.............................87
11.7. Intercreditor Agreement with Holder of Seller Loan..........87
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11.8. Security Agreement..........................................88
11.9. Tax Allocation Agreements...................................88
11.10. Solvency Certificate; Insurance Certificates; etc...........89
11.11. Financial Statements; Pro Forma Financial Statements........89
11.12. Payment of Fees.............................................89
11.13. Budgets.....................................................89
11.14. Seller Loan.................................................89
11.15. Pledge Agreement............................................89
11.16. Participation Agreement.....................................90
11.17. Intercompany Subordination Agreement........................90
11.18. Lockbox Accounts............................................90
12. CONDITIONS PRECEDENT TO ALL LOANS....................................90
12.1. Closing Date................................................90
12.2. No Default; Representations and Warranties..................90
12.3. Loan Request................................................91
13. EVENTS OF DEFAULT; ACCELERATION; ETC.................................91
13.1. Events of Default and Acceleration..........................91
13.2. Termination of Commitments..................................94
13.3. Remedies....................................................94
13.4. Distribution of Collateral Proceeds.........................94
14. ADMINISTRATIVE AGENT.................................................95
14.1. Appointment and Authority...................................95
14.2. Rights as a Lender..........................................95
14.3. Exculpatory Provisions......................................96
14.4. Reliance by Administrative Agent............................97
14.5. Delegation of Duties........................................97
14.6. Resignation of Administrative Agent.........................97
14.7. Non-Reliance on Administrative Agent and Other Lenders......98
14.8. Administrative Agent May File Proofs of Claim...............99
14.9. Collateral Matters..........................................99
15. SUCCESSORS AND ASSIGNS..............................................100
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15.1. General Conditions.........................................100
15.2. Assignments by Lenders.....................................100
15.3. Register...................................................102
15.4. Participations.............................................102
15.5. Limitations upon Participant Rights........................103
15.6. Certain Pledges............................................103
15.7. Electronic Execution of Assignments........................103
16. PROVISIONS OF GENERAL APPLICATIONS..................................104
16.1. Setoff.....................................................104
16.2. Expenses...................................................104
16.3. Indemnification............................................105
16.4. Treatment of Certain Confidential Information..............106
16.4.1. Confidentiality...................................106
16.4.2. Prior Notification................................107
16.4.3. Other.............................................107
16.5. Survival of Covenants, etc.................................107
16.6. Notices....................................................108
16.7. Governing Law..............................................109
16.8. Headings...................................................109
16.9. Counterparts...............................................109
16.10. Entire Agreement, etc......................................109
16.11. Waiver of Jury Trial.......................................110
16.12. Consents, Amendments, Waivers, Etc.........................110
16.13. Replacement of Lenders.....................................112
16.14. Severability...............................................113
16.15. USA Patriot Act............................................113
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Exhibits
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Exhibit A Form of Asset Base Report
Exhibit B Form of Assignment and Assumption
Exhibit C Form of Equipment Report
Exhibit D Form of Manager Report
Exhibit E Form of Loan Request
Exhibit F Form of Revolving Credit Note
Exhibit G Credit and Collection Policy
Exhibit H Form of Lease Agreement
Exhibit I UBS Lease Agreement
Exhibit J Depreciation Policy
Exhibit K Interest Rate Hedge Policy
Exhibit L Form of Opinion of Borrowers' Counsel
Exhibit M Form of Officer's Certificate of Borrower
Exhibit N Form of Security Agreement
Exhibit O Form of Solvency Certificate
Exhibit P Form of Pledge Agreement
Exhibit Q Intercompany Subordination Agreement
Exhibit R Form of Intercompany Note
Exhibit S Summary of Agreed Upon Procedures
Schedules
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Schedule 1 Funding Commitments of Lenders
Schedule 2 Concentration Limits
Schedule 3 Rights with Respect to Leases that are Not
Assignable Without the Consent of the Related Lessee
or Any Other Person
Schedule 4 Management Fees
Schedule 5 UBS Lease Termination Payments
Schedule 7.5 Use of Proceeds of Closing Date Advance
Schedule 7.13 Subsidiaries of Borrowers
Schedule 7.18 Existing Indebtedness of Borrowers and Subsidiaries
Schedule 7.19 Insurance Maintained by Borrowers and Subsidiaries
Schedule 7.21 List of Names and Addresses of All Lockboxes and
Lockbox Accounts
Schedule 9.3 Liens Existing on the Closing Date
Schedule 9.5 Investments Existing on the Closing Date
Schedule 9.7 Agreements of Borrowers and Subsidiaries with any
Affiliate of the Borrowers or the Subsidiaries
Schedule 9.8 Encumbrances or Restrictions on Borrowers and
Subsidiaries
CREDIT AGREEMENT
This CREDIT AGREEMENT is made as of November 3, 2004, by and among
TRANSAMERICA LEASING INC., a corporation organized and existing under the laws
of the State of Delaware (together with its successors and permitted assigns,
"TLI"), TRANS OCEAN LTD., a corporation organized and existing under the laws of
the State of Delaware (together with its successors and permitted assigns,
"TOL"), TRANS OCEAN CONTAINER CORPORATION, a corporation organized under the
laws of the State of Delaware (together with its successors and permitted
assigns, "TOCC", each of TLI, TOL and TOCC, a "Borrower" and collectively, the
"Borrowers"), each lender from time to time party hereto (collectively, the
"Lenders" and individually, a "Lender"), and FORTIS BANK (NEDERLAND) N.V.
WHEREAS, subject to and upon the terms and conditions set forth herein,
the Lenders are willing to make available to the Borrowers the credit facility
provided for herein;
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
and agreements set forth herein below, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as provided herein:
1. DEFINITIONS AND RULES OF INTERPRETATION.
1.1. DEFINITIONS. The following terms shall have the meanings set forth in
this Section 1 or elsewhere in the provisions of this Loan Agreement
referred to below:
Acceleration Event. The acceleration of the Revolving Credit
Notes and the other Obligations in accordance with the provisions of Section
13.1 hereof.
Accounts Payable Account. Bank account number ____ maintained
by TLI at Citibank N.A. and any replacement for such account established in
accordance with the provisions of this Loan Agreement.
Acquisition. The acquisition by Container Holdings of all of
the Capital Stock of Transamerica Leasing Inc. and Trans Ocean Ltd.
Acquisition Date. With respect to a Container, the date on
which a Borrower initially acquired such container.
Administrative Agent. Fortis acting as agent for the Lenders
and each other Person appointed as the successor Administrative Agent in
accordance with Section 14.6.
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Administrative Agent's Office. The Administrative Agent's
office located at 3000 AS Rotterdam, The Netherlands, or at such other location
as the Administrative Agent may designate from time to time.
Administrative Agent's Special Counsel. Xxxxxxx Xxxxxxxx &
Xxxx LLP or such other counsel as may be approved by the Administrative Agent.
Administrative Questionnaire. An Administrative Questionnaire
in a form supplied by the Administrative Agent.
Affiliate. With respect to any Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
Agent Fee. The fee payable to the Administrative Agent on each
Payment Date as set forth in the Fee Letter.
Aggregate Commitments. An amount equal to the sum of the
Commitments of all the Lenders.
Aggregate Net Book Value. As of any date of determination, an
amount equal to the sum of the Net Book Values (such Net Book Values to be
measured as of the last day of the prior month) of all Eligible Containers.
Aggregate Note Principal Balance. As of any date of
determination, an amount equal to the sum of the then unpaid principal balance
of all Revolving Credit Notes.
Applicable Margin. With respect to each Loan for each Interest
Period, one of the following amounts:
(A) with respect to each Base Rate Loan, one and one-half
percent (1.50%) per annum; or
(B) with respect to each LIBOR Rate Loan, two and three
quarters percent (2.75%).
Notwithstanding the foregoing, the following modifications to the amounts set
forth in clauses (A) and (B) shall be applicable:
(1) all of the amounts set forth in clauses (A) and (B) above
shall increase by one half of one percent (0.50%) if the
Borrowers have not completed a Refinancing Event by April
30, 2006; and
(2) notwithstanding the terms of clauses (A) and (B) above, if
the Administrative Agent is unable, despite its
commercially reasonable efforts, to complete a "successful
syndication" of
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Commitments and the Loans at such levels, then (x) the
amount referred to in clause (A) shall increase to the
rate at which the Administrative Agent can complete a
"successful syndication" of the Commitments and the Loans
using its commercially reasonable efforts (which rate
shall, in no event, exceed two and one quarter percent
(2.25%) per annum) and (y) the amount referred to in
clause (B) shall increase to the rate at which the
Administrative Agent can complete a "successful
syndication" of the Commitments and the Loans using its
commercially reasonable efforts (which rate shall, in no
event, exceed three and one half percent (3.50%) per
annum). For the purposes of this paragraph, "successful
syndication" means that the Administrative Agent shall
reduce its participation in the Commitments and the Loans
to a final hold of not more than $250,000,000.00.
Asset Base. As of any date of determination, an amount equal
to the sum of:
(1) the product of (i) the Existing Container Advance Rate
then in effect and (ii) the sum of (x) the then Net Book Values
(calculated as of the last day of the immediately preceding month) of
all Eligible Containers that were either owned by any Borrower or
subject to a Finance Lease for which any Borrower is the lessor, in
each case, on the Closing Date, (y) to the extent not included in
clause (x), the then Net Book Values of all containers then subject to
the terms of the UBS Lease Agreement and (z) any receivables resulting
from the sale or other disposition of one or more Eligible Containers
that were either owned by any Borrower or subject to a Finance Lease
for which any Borrower is the lessor, in each case, on the Closing
Date, so long as such receivables were not outstanding for more than 90
days (measured from the issue date of such receivables); plus
(2) the product of (i) the Post-Closing Advance Rate then in
effect and (ii) the sum of (x) the excess of (A) the sum of the then
Net Book Values (calculated as of the last day of the immediately
preceding month) of all Eligible Containers acquired by any Borrower
after the Closing Date and which are owned by any Borrower on such date
of determination or which are subject to a Finance Lease for which any
Borrower is the lessor on such date of determination, over (B) the sum
of the Net Book Values of any such container included in clause (A) for
which the manufacturer or other seller thereof has not received payment
in full of the related purchase price, and (y) all receivables
resulting from the sale or other disposition of one or more Eligible
Containers that were acquired by a Borrower after the Closing Date so
long as such receivables are not outstanding for more than 90 days
(measured from the issue date of such receivables); minus
(3) the sum of all then unpaid UBS Lease Termination Payments.
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Asset Base Deficiency. As of any Payment Date, the amount (if
any) by which (i) the Aggregate Note Principal Balance (calculated without
giving effect to any principal payments to be paid on such Payment Date),
exceeds (ii) the Asset Base.
Asset Base Report. An Asset Base Report signed by a
responsible officer of the Borrowers and in substantially the form of Exhibit A
hereto.
Asset Value Adjustment Date. The date on which the Net Book
Values of all Containers owned by the Borrowers on the Closing Date are adjusted
upward as a result of the consummation of the Acquisition; provided, however,
that the Asset Value Adjustment Date shall not occur unless the Administrative
Agent shall have approved (such approval to not be unreasonably withheld or
delayed) both (i) the amount of any such upward adjustments in the Net Book
Values of such Containers, and (ii) any revision in the Depreciation Policy to
be implemented in connection with such adjustments.
Assignment and Assumption. An assignment and assumption
entered into by a Lender and an Eligible Assignee (with the consent of any party
whose consent is required by Section 15.2), and accepted by the Administrative
Agent, in substantially the form of Exhibit B or any other form approved by the
Administrative Agent.
Authorized Officer. With respect to (i) delivering Notices of
Borrowing and similar notices, any person or persons that has or have been
authorized by the Board of Directors of a Borrower to deliver such notices
pursuant to this Loan Agreement and that has or have appropriate signature cards
on file with the Administrative Agent, (ii) delivering financial information and
officer's certificates pursuant to this Loan Agreement, any Senior Designated
Officer of any Borrower and (iii) any other matter in connection with this Loan
Agreement or any other Loan Document, any officer (or a person or persons so
designated by any two officers) of the Borrowers.
Availability Termination Date. The earlier to occur of (i) the
date of which the Commitments are terminated pursuant to Sections 2.5 or 13.2
hereof and (ii) the two year anniversary of the Closing Date.
Base Rate. The higher of (a) the variable annual rate of
interest so designated from time to time by Citibank N.A. as its "prime rate",
such rate being a reference rate and not necessarily representing the lowest or
best rate being charged to any customer, and (b) one-half of one percent (0.50%)
above the Federal Funds Effective Rate. For the purposes of this definition,
"Federal Funds Effective Rate" shall mean for any day, the rate per annum equal
to the weighted average of the rates on overnight federal funds transactions
with members of the Federal Reserve System arranged by federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average of the
quotations for such day on such transactions received by the Administrative
Agent from three funds brokers of recognized standing selected by the
Administrative Agent. Changes in the
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Base Rate resulting from any changes in Citibank N.A.'s "prime rate" shall take
place immediately without notice or demand of any kind.
Base Rate Loans. All or any portion of any Loan bearing
interest calculated by reference to the Base Rate.
Borrower. Each of TLI, TOL and TOCC.
Breakage Cost. With respect to any Lender with respect to any
Breakage Prepayment, an amount equal to the difference (as reasonably determined
by such Lender and set forth in a certificate of such Lender delivered to the
Borrowers) of (a) such Lender's cost of obtaining funds for the LIBOR Rate Loan
that is the subject of such Breakage Prepayment for the period from the date of
such Breakage Prepayment to the last day of the Interest Period in effect (or
that would have been in effect) for such LIBOR Rate Loan, minus (b) the amount
of interest likely to be realized by such Lender in redeploying the funds
released or not utilized by reason of such Breakage Conversion or such Breakage
Prepayment for such period.
Breakage Prepayment. This term shall have the meaning set
forth in Section 4.3 hereof.
Business Day. One of the following: (i) for all purposes other
than as covered by clause (ii) below, any day excluding Saturday, Sunday and any
day which shall be in Xxx Xxxx, Xxx Xxxx, Xxxxxx, Xxxxxxx or Rotterdam, The
Netherlands a legal holiday or a day on which banking institutions are
authorized by law or other governmental actions to close and (ii) with respect
to all notices and determinations in connection with, and payments of principal
and interest on or with respect to, Eurodollar Loans, any day which is a
Business Day described in clause (i) above and which is also a day for trading
by and between banks in U.S. dollar deposits in the interbank Eurodollar market.
Capitalized Leases. Leases under which a Borrower is the
lessee or obligor, the discounted remaining rental payment Obligations under
which are required to be capitalized on the balance sheet of the lessee or
obligor in accordance with GAAP.
Capital Stock. Any and all shares, interests, participations
or other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person (other than a corporation)
and any and all warrants, rights or options to purchase any of the foregoing.
Cash Equivalents. All of the following: (i) securities issued
or directly fully guaranteed or insured by the governments of the United States,
Canada and members of the European Union or any agency or instrumentality
thereof (provided that the full faith and credit of the respective such
government is pledged in support thereof) having maturities of not more than one
year from the date of acquisition, (ii) securities issued by any state of the
United States or any political subdivision of any such state or any public
instrumentality thereof maturing within one year from the date of acquisition
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thereof and, at the time of acquisition, having one of the two highest ratings
obtainable from either S&P or Xxxxx'x, (iii) certificates of deposit and
Eurodollar time deposits with maturities of one year or less from the date of
acquisition, bankers' acceptances with maturities not exceeding one year and
overnight bank deposits, in each case with any domestic commercial bank or
commercial bank of a foreign country recognized by the United States, (x) in the
case of a domestic commercial bank, having capital and surplus in excess of
$500,000,000 and outstanding debt which is rated "A" (or similar equivalent
thereof) or higher by at least one nationally recognized statistical rating
organization (as defined under Rule 436 under the Securities Act) and (y) in the
case of a foreign commercial bank, having capital and surplus in excess of
$250,000,000 (or the foreign currency equivalent thereof), (iv) repurchase
obligations with a term of not more than thirty days for underlying securities
of the types described in clauses (i) and (iii) above entered into with any
financial institution meeting the qualifications specified in clause (iii)
above, (v) commercial paper having a rating of at least A-2 from S&P or at least
P-2 from Xxxxx'x, (vi) securities with maturities of six (6) months or less from
the date of acquisition backed by standby letters of credit issued by any Lender
or any commercial bank satisfying the requirements of clause (iii)(x) of this
definition, (vii) Indebtedness or preferred stock issued by Persons with a
rating of A or higher from S&P or A2 or higher from Xxxxx'x with maturities of
24 months or less from the date of acquisition and (viii) investments in money
market funds which invest substantially all their assets in securities of the
types described in clauses (i) through (vii) above.
Casualty Loss. With respect to any Container as of any date of
determination, any of the following events or conditions:
(i) total loss or destruction thereof;
(ii) theft or disappearance thereof without recovery
within sixty (60) days after such theft or
disappearance becomes known to any Borrower or any of
its Affiliates;
(iii) damage rendering such Container unfit for normal use
and, in the judgment of any Borrower, beyond repair
at reasonable cost; or
(iv) any condemnation, seizure, forced sale or other
taking of title to or use of such Container.
Casualty Proceeds. Any payment by, or on behalf of, a Lessee
from any source in connection with a Casualty Loss with respect to a Container.
CEU. Cost equivalent units.
Change of Control. With respect to any of Container Holdings,
TOCC, TLI or TOL and without the prior consent of the Required Lenders, the
occurrence of any of the following events or conditions: (i) any "person" (as
such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934), other than one or more Permitted Holders, is or becomes the "beneficial
owner" (as defined in Rules 13d-3 and
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13d-5 under the Securities Exchange Act of 1934), directly or indirectly, of
more than 50% of the total voting power of the voting common equity interests of
such Person, or (ii) prior to the first Public Equity Offering, any "person" (as
such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934), other than one or more Permitted Holders, shall have acquired, by
contract or otherwise, the power to exercise, directly or indirectly, a
controlling influence over the composition of the board of directors or other
similar management body of such Person, or (iii) prior to the first Public
Equity Offering, the Permitted Holders cease for any reason to be the beneficial
owner, directly or indirectly, in the aggregate of at least a majority of the
total voting power of the voting Capital Stock of Container Holdings, whether by
virtue of the issuance, sale or other disposition of Capital Stock of Container
Holdings, a merger, consolidation or sale of assets involving Container
Holdings, one of its Subsidiaries, any voting trust or other agreement, or (iv)
subsequent to the first Public Equity Offering, the Permitted Holders
beneficially own, directly or indirectly, in the aggregate a lesser percentage
of the total voting power of the voting Capital Stock of Container Holdings,
TLI, TOL or TOCC than such other "person" (as such term is used in Section 13(d)
and 14(d) of the Securities Exchange Act of 1934) or "group" (as such term is
used in Section 13(d) and 14(d) of the Securities Exchange Act of 1934).
Closing Date. November 3, 2004.
Closing Date Advance. The Loan in the maximum aggregate
principal amount equal to the lesser of (A) the Asset Base on the Closing Date,
and (B) Eight Hundred Twenty Million Dollars ($820,000,000), to be made by the
Lenders to the Borrowers on the Closing Date pursuant to the provisions of
Section 2.1 hereof.
Closing Date Advance Rate. One of the following amounts:
(1) on the Closing Date and all times thereafter until the
Asset Value Adjustment Date, seventy-six and one half percent (76.5%);
and
(2) at all times on or after the Asset Value Adjustment Date,
the amount determined on the Asset Value Adjustment Date in accordance
with the following formula:
76.5% x A/B
Where A = the sum of the Net Book Values of all Eligible
Containers owned by any Borrower on the Closing Date
calculated immediately prior to any approved increase
in such Net Book Values on the Asset Value Adjustment
Date; and
B = the sum of the Net Book Values of all Eligible
Containers owned by any Borrower on the Closing Date
calculated immediately after giving effect to any
approved increase in such Net Book Values on the
Asset Value Adjustment Date.
-8-
Code. The United States Internal Revenue Code of 1986, as
amended from time to time (and any successor statute thereto), and the
regulations promulgated and rulings issued thereunder. Section references to the
Code are to the Code as in effect on the Closing Date, and any subsequent
provisions of the code, amendments thereto or substituted therefrom.
Collateral. All of the property, rights and interests of the
Borrowers that are or are intended to be subject to the Liens created by the
Security Documents.
Collection Period. Initially, the period commencing on the
Closing Date to and including December 31, 2004, and thereafter each calendar
quarter.
Commitment. With respect to each Lender, the amounts set forth
on Schedule 1 hereto as the amounts of such Lender's commitment to make Loans to
the Borrowers pursuant to this Loan Agreement, as the same may be reduced from
time to time; or if such commitments are terminated pursuant to the provisions
hereof, zero.
Commitment Fee. This term shall have the meaning set forth in
Section 5.1.1.
Commitment Percentage. With respect to any Lender, the
percentage (carried out to the ninth decimal place) of the Aggregate Commitments
represented by such Lender's Commitment at such time. If the commitment of each
Lender to make Loans has been terminated pursuant to this Loan Agreement or if
the Aggregate Commitments have expired, then the Commitment Percentage of each
Lender shall be determined based on the outstanding Loans owing to such Lender
at such time. The initial Commitment Percentage of each Lender is set forth
opposite the name of such Lender on Schedule 1 pursuant to which such Lender
becomes a party hereto, as applicable.
Company. Any corporation, limited liability company,
partnership or other business entity (or the adjectival form thereof, where
appropriate).
Concentration Account. Bank account number 00000000 maintained
by TLI at Citibank N.A. and any replacement for such account established in
accordance with the terms of this Loan Agreement.
Concentration Limits. As of any date of determination, all of
the following:
(1) The sum of the Net Book Values of all Specialized
Containers (other than refrigerated Containers) shall
not exceed an amount equal to 15% of the then
Aggregate Net Book Value;
(2) The sum of the Net Book Values of all 20 foot, 40
foot and 40 foot high cube refrigerated Containers
shall not exceed an amount equal to 40% of the then
Aggregate Net Book Value;
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(3) The sum of the Net Book Values of all Containers then
on lease to any three Lessees shall not exceed
forty-five percent (45%) of the then Aggregate Net
Book Value; provided, however, that if two or more
Lessees shall engage in any transaction (whether
through merger, consolidation, stock sale, asset sale
or otherwise) pursuant to which a Lessee shall become
the owner of, or interest holder in, any other
Lessee's leasehold interests in one or more
Containers and the effect of such transaction is to
cause a breach of the foregoing threshold, then the
foregoing threshold shall on the effective date of
such transaction be increased to an amount equal to
the quotient, expressed as a percentage, (x) the
numerator of which shall equal the sum of (A) the sum
of the Net Book Values of all Containers on lease to
such transacting Lessees immediately prior to such
transaction, and (B) the sum of the Net Book Values
of all Containers then on lease to the two other
Lessees having the most Containers then on lease with
the Borrowers (measured by Net Book Value) and (y)
the denominator of which shall equal the then
Aggregate Net Book Value); and provided further that,
if the foregoing limitation has been increased above
forty-five percent (45%) by operation of the above
proviso, then none of the Borrowers shall thereafter
originate any additional Leases of Containers to any
of such three Lessees until such time as the sum of
the Net Book Values of all Containers then on lease
to such three Lessees does not exceed an amount equal
to forty-five percent (45%) of the then Aggregate Net
Book Value.
(4) The sum of the Net Book Values of all Containers then
on Lease to any single Lessee shall not exceed an
amount equal to (A) with respect to any of the
Lessees set forth in Schedule 2 hereto, the
percentage of the Aggregate Net Book Value set
opposite the name of such Lessee on such schedule,
and (B) with respect to any Lessee not covered by
clause (A), five percent (5%) of the then Aggregate
Net Book Value; provided, however, that if two or
more Lessees shall engage in any transaction (whether
through merger, consolidation, stock sale, asset sale
or otherwise) pursuant to which a Lessee shall become
the owner of, or interest holder in, any other
Lessee's leasehold interests in one or more
Container, the foregoing threshold set forth in
clauses (A) and (B) shall on the effective date of
such transaction be increased with respect to such
acquiring or, in the case of a merger, surviving
Lessee to equal the greater of (i) the sum of the
applicable percentage limitations for the transacting
Lessees as set forth in clauses (A) and (B) above,
and (ii) a quotient, expressed as a percentage, (x)
the numerator of which shall equal the sum of the Net
Book Values of all Containers on Lease to such
transacting Lessees immediately prior to such
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transaction and (y) the denominator of which shall
equal the then Aggregate Net Book Value);
(5) The sum of the Net Book Values of all Containers for
which the initial Lease of such Container after its
Acquisition Date is a Finance Lease shall not exceed
20% of the then Aggregate Net Book Value; and
(6) The sum of the Net Book Values of all Containers
acquired during the Revolving Credit Period that have
not been put on its initial lease since the
applicable Acquisition Date (i.e. speculative leases)
shall not exceed 5% of the then Aggregate Net Book
Value.
Any Container that does not comply with all of the foregoing will not be
considered to be an Eligible Container.
Consolidated or consolidated. With reference to any term
defined herein, shall mean that term as applied to the accounts of the Borrowers
and their Subsidiaries, consolidated in accordance with GAAP.
Consolidated Cash Interest Expense. With respect to any Person
for any period, the difference of (i) the aggregate Consolidated Interest
Expense of such Person for such period, minus (ii) to the extent included in
such aggregate Consolidated Interest Expense, and to the extent incurred by
Container Holdings or any of its Consolidated Subsidiaries, (a) amortization or
write off of debt or equity issuance costs, (b) interest expense to the extent
not paid in cash attributable to dividends in respect of all Preferred Equity of
Container Holdings and its Consolidated Subsidiaries that is not Disqualified
Stock pursuant to Statement of Financial Accounting Standards No. 150,
"Accounting for Certain Financial Instruments with Characteristics of Both
Liabilities and Equity", and (c) any non-cash interest expense related to (i)
any interest expense that has not been paid in cash, (ii) accrued interest on
Disqualified Stock to the extent not paid, and (iii) any incremental non-cash
interest expense incurred by Container Holdings or its Subsidiaries as the
result of an accounting change in accordance with GAAP that occurs after the
Closing Date, plus (iii) cash interest payments made in such period (exclusive
of any such cash payment funded with the proceeds of an equity offering or
capital contribution) related to Consolidated Interest Expense that was accrued
in a prior period.
Consolidated EBIT. For any period, means the sum of
Consolidated Net Income, plus the following, without duplication, to the extent
deducted in calculating such Consolidated Net Income:
(1) all income tax expense of Container Holdings and its
Consolidated Subsidiaries, all taxes incurred by
Container Holdings and its Consolidated Subsidiaries
in respect of the repatriation of income from
jurisdictions outside the United States and all
amounts paid by Container Holdings and its
Consolidated Subsidiaries pursuant to the terms of
any tax sharing or similar agreement;
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(2) the Consolidated Interest Expense of Container
Holdings and its Consolidated Subsidiaries;
(3) depreciation and amortization charges of Container
Holdings and its Consolidated Subsidiaries relating
to any increased depreciation or amortization charges
resulting from purchase accounting adjustments or
inventory write-ups with respect to acquisitions or
the amortization or write-off of deferred debt or
equity issuance costs;
(4) all other non-cash charges of Container Holdings and
its Consolidated Subsidiaries (other than
depreciation expense) (minus, with respect to any
such non-cash charge occurring on or after January 1,
2005 that was previously added in a prior period to
calculate Consolidated EBIT and that represents an
accrual of or reserve for cash expenditures in any
future period, any cash payments made during such
period);
(5) any non-capitalized costs incurred in connection with
financings, the Acquisition, acquisitions of
Containers occurring after the Closing Date or
dispositions (including financing and refinancing
fees and any premium or penalty paid in connection
with redeeming or retiring Indebtedness prior to the
stated maturity thereof pursuant to the agreements
governing such Indebtedness);
(6) UBS equipment rental expense to the extent that
assets related to such expense have been repurchased
by the Borrowers and their Consolidated Subsidiaries;
(7) all non-cash expenses attributable to Incentive
Arrangements; and
(8) to the extent that any portion of the Management Fee
payable during such period was accrued and not paid
during such period, the aggregate amount of expenses
attributable to all payments or accruals of
Management Fee during such period;
in each case, for such period and as determined on a consolidated basis in
accordance with GAAP.
Consolidated EBIT to Consolidated Cash Interest Expense Ratio.
As of any date of determination, means the ratio of (a) the aggregate amount of
Consolidated EBIT for Container Holdings and its Consolidated Subsidiaries for
the period of the most recent four consecutive fiscal quarters ending on or
prior to the date of such determination to (b) Consolidated Cash Interest
Expense for Container Holdings and its Consolidated Subsidiaries for such four
fiscal quarters.
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Consolidated Interest Expense. With respect to any Person for
any period, the aggregate of the interest expense of such Person and its
Consolidated Subsidiaries for such period, on a Consolidated basis, as
determined in accordance with GAAP, and including, without duplication, (a) all
amortization or accretion of original issue discount; (b) the interest component
of payments on Capitalized Leases paid, accrued and/or scheduled to be paid or
accrued by such Person and its Consolidated Subsidiaries during such period; and
(c) net cash costs under all Interest Rate Hedging Agreements (including
amortization of fees).
Consolidated Net Income. For any period, the aggregate net
income (or loss) of Container Holdings and its Consolidated Subsidiaries for
such period on a consolidated basis, determined in accordance with GAAP;
provided, however, that there shall be not be included in such Consolidated Net
Income:
(1) any gain (or loss) realized upon the sale or other
disposition of assets (other than Containers and
Related Assets) of Container Holdings, any Borrower,
any Consolidated Subsidiary or any other Person
(including pursuant to any sale-and-leaseback
arrangement) which is not sold or otherwise disposed
of in the ordinary course of business and any gain
(or loss) realized upon the sale or other disposition
of any Capital Stock of any Person;
(2) extraordinary gains or losses, as determined in
accordance with GAAP;
(3) income or loss attributable to discontinued
operations (including, without limitation, operations
disposed of during such period whether or not such
operations were classified as discontinued);
(4) the cumulative effect of a change in accounting
principles, as determined in accordance with GAAP;
(5) any adjustments, restructuring costs, non-recurring
expenses, non-recurring fees, non-operating expenses,
charges or other expenses (including bonus and
retention payments and non-cash compensation charges)
(a) made or incurred in connection with the
Acquisition or the financing thereof or (b) incurred
in connection with acquisitions of Containers
consummated after the Closing Date; and
(6) Systems/Organizational Establishment Expenses;
in each case, for such period.
Container. Any marine and maritime container (including dry
cargo containers, refrigerated containers (including the associated generator
sets) and
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Specialized Containers) to which any Borrower either (i) has good title and that
is held for lease or sale or (ii) is lessor under any Finance Lease.
Container Holdings. TAL International Group, Inc., a
corporation organized under the laws of the State of Delaware and its successors
and permitted assigns.
Container Representations and Warranties. All of the
following:
(1) Specifications. The container conforms to the
Borrowers' standard specifications for that category
of container and to any applicable industry
standards;
(2) Rights to Leases. Except as set forth on Schedule 3
hereto, the rights with respect to each Lease
included in the Related Assets for such Container are
assignable without the consent of the related Lessee
or any other Person other than consents that will
have been obtained on or before the related transfer
date;
(3) Lessee Acceptance. With respect to each container
that is subject to a Lease on the Closing Date or
Funding Date, as the case may be, the related Lessee
has, to the best of TLI's knowledge, received and
taken possession of such container;
(4) Lease Files. Each Lease is stored in TLI's offices
located in Purchase, New York and is subject to its
customary security and safekeeping procedures;
(5) Master Lease Arrangements. In the case of each Lease
which consists of a master lease and one or more
addenda or schedules thereto, such addenda or
schedules each constitute a separate contractual
lease obligation of the related Lessee;
(6) Chattel Paper. With respect to each Lease, aside from
any originally executed counterpart of each Lease in
the possession of the Lessee, all other originally
executed counterpart(s) of such Lease are in the
possession of the Borrowers;
(7) Lessees. No Lessee is an affiliate of the Borrowers;
(8) Registration. Each container's registration xxxx
(four letter prefix) has been registered in the name
of one of the Borrowers in the official register of
the Bureau International des Containers (Paris);
(9) Non-cancelable and Assignable. Each Finance Lease
provides that (i) the Lessee's obligations thereunder
are non-cancelable,
-14-
unconditional and not subject to any right of
set-off, rescission, counterclaim, offset, reduction
or recoupment, (ii) such finance lease is fully
assignable and (iii) the Lessee is responsible for
all taxes, maintenance and insurance and assumes all
risk of Casualty Loss;
(10) Compliance with Law. The Lease complied in all
material respects at the time they were originated
with all legal requirements of the jurisdiction in
which they were originated; and
(11) Return of Container. Each Lease provides for the
return of the related containers upon its expiration
or earlier termination (unless the Lessee complies
with the terms of any purchase option contained
therein).
Contingent Obligation. As to any Person, means any obligation
of such Person as a result of such Person being a general partner of any other
Person, unless the underlying obligation is expressly made non-recourse as to
such general partner, and any obligation of such Person guaranteeing or intended
to guarantee any Indebtedness, leases, dividends or other obligations ("primary
obligations") of any other Person (the "primary obligor") in any manner, whether
directly or indirectly, including, without limitation, any obligation of such
Person, whether or not contingent, (i) to purchase any such primary obligation
or any property constituting direct or indirect security therefor, (ii) to
advance or supply funds (x) for the purchase or payment of any such primary
obligation or (y) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency of the primary
obligor, (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation or (iv) otherwise
to assure or hold harmless the holder of such primary obligation against loss in
respect thereof; provided, however, that the term Contingent Obligation shall
not include endorsements of instruments for deposit or collection in the
ordinary course of business. The amount of any Contingent Obligation shall be
deemed to be an amount equal to the lesser of (x) the stated or determinable
amount of the primary obligation in respect of which such Contingent Obligation
is made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to perform
thereunder) as determined by such Person in good faith and (y) the stated amount
of such Contingent Obligation.
Control. The possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
Credit and Collection Policy. This term shall have the meaning
set forth in Section 7.22.
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Default. Any event, act or condition, which with the giving of
notice or lapse of time or both would constitute an Event of Default.
Defaulting Lender. Any Lender that (a) has failed to fund any
portion of the Loans required to be funded by it hereunder within one Business
Day of the date required to be funded by it hereunder, (b) has otherwise failed
to pay over to the Administrative Agent or any other Lender any other amount
required to be paid by it hereunder within one Business Day of the date when
due, unless the subject of a good faith dispute, or (c) has been deemed
insolvent or become the subject of a bankruptcy or insolvency proceeding.
Depreciation Policy. The depreciation policy utilized by the
Borrowers with respect to the Containers, which policy as of the Closing Date is
attached as Exhibit H hereto.
Designated Event of Default. The occurrence of an Event of
Default of the types set forth in Sections 13.1(a), 13.1(b), 13.1(c), 13.1(e),
13.1(h), 13.1(i)(i)(x), 13.1(i)(ii)(x) or 13.1(j) hereof.
Determination Date. Initially, January 24, 2005 and thereafter
the fifteenth Business Day of each calendar quarter.
Direct Operating Expenses. All direct expenses and costs,
calculated on an accrual basis in accordance with GAAP, incurred in connection
with the ownership, use and/or operation of a container, including but not
limited to: (i) agency costs and expenses; (ii) depot fees, handling, and
storage costs and expenses; (iii) survey, maintenance and repair expenses
(including the actual or estimated cost of repairs to be made pursuant to a
damage protection plan); (iv) repositioning expense; (v) the cost of inspecting,
marking and remarking such Container; (vi) third-party fees for bankruptcy
recovery; (vii) legal fees incurred in connection with enforcing rights under
the leases of such Container or repossessing such Container; (viii) insurance
expense; (ix) federal, state, local and foreign taxes, levies, duties, charges,
assessments, fees, penalties, deductions or withholdings assessed, charged or
imposed upon or against such Container, including but limited to ad valorem,
gross receipts and/or other property taxes imposed against such Container or
against the revenues generated by such Container; (x) expenses, liabilities,
claims and costs (including without limitation reasonable attorneys fees)
incurred by a Borrower or any Subsidiary or made against a Borrower or any
Subsidiary by any third party arising directly or indirectly (whether wholly or
in part) out of the state, condition, operation, use, storage, possession,
repair, maintenance or transportation of such Container; (xi) expenses and costs
(including legal fees) of pursuing claims against manufacturers or sellers of
such Container; and (xii) non-recoverable sales and value-added taxes on such
expenses and costs; provided, however, that in no event shall either of the
following be considered a Direct Operating Expense: (a) any selling, general and
administrative expenses of Container Holdings, the Borrowers or any of their
Subsidiaries, or (b) the Management Fees.
-16-
Disqualified Stock. With respect to any Person means that
portion of any Capital Stock of such Person which, by its terms (or by the terms
of any security into which it is convertible or for which it is exchangeable at
the option of the holder thereof), or upon the happening of any event (other
than an event that would constitute a Change of Control), matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
is redeemable at the sole option of the holder thereof (except in each case,
upon the occurrence of a Change of Control) on or prior to the first anniversary
of the final maturity date of the Loans for cash or is convertible into or
exchangeable for debt securities of Container Holdings or its Consolidated
Subsidiaries at any time prior to such anniversary.
Distributable Cash Flow. This term shall have the meaning set
forth in Section 3.1(c).
Dividend. With respect to any Person, (i) the declaration or
payment by such Person of a dividend or distribution (other than dividends or
distributions payable in Capital Stock of such Person (other than Disqualified
Stock)) on or in respect of shares of the Capital Stock of such Person or (ii)
the purchase, redemption or other acquisition or retirement for value of any
Capital Stock of such Person.
Dollars or $. Dollars in lawful currency of the United States
of America.
Eligible Assignee. Any of the following: (i) a Lender; (ii) an
Affiliate of a Lender; and (iii) any other Person (other than a natural person)
approved by the Borrowers and the Administrative Agent (each such approval not
to be unreasonably withheld or delayed); provided that notwithstanding the
foregoing, "Eligible Assignee" shall not include any Borrower nor any of their
respective Affiliates.
Eligible Container. Each Container which, when considered with
all other Containers, shall comply with each of the following requirements:
(1) Such Container substantially conforms to the standard
specifications used by the Borrowers for containers
purchased for its own account, for that category of
container and to any commonly applied standards
promulgated by the International Organization for
Standardization;
(2) Such Container shall comply with all of (i) the
Concentration Limits and (ii) the Container
Representations and Warranties;
(3) Such Container shall not have suffered a Casualty
Loss;
(4) Either (i) one of the Borrowers shall have good and
marketable title to such Container and the
Administrative Agent has a perfected security
interest therein or (ii) such Container is subject to
a Finance Lease for which any Borrower is the lessor;
-17-
(5) Such Container shall be free and clear of all Liens
except for Permitted Liens;
(6) Either (i) the lease rights with respect to such
Container are assignable without consent or for which
consents have been obtained, or (ii) the
Administrative Agent shall have been granted a one
hundred percent (100%) participation interest in the
lease rights with respect to such Container;
provided, however, that the sum of the Net Book
Values of all Containers that have been classified as
an Eligible Container pursuant to clause (ii) above
shall not exceed two and one half percent (2.5%) of
the Asset Base;
(7) Each lease for such Container shall substantially
contain the general trading terms the Borrowers use
in the normal course of their business;
provided, however, that (i) in addition to any Container that complies with all
of the foregoing, the containers owned by ICS Terminals (UK) Limited shall also
be considered an Eligible Container for purposes of calculating the Asset Base
so long as (x) ICS Terminals (UK) Limited remains a Wholly-Owned Subsidiary of
any Borrower and such containers do not become subject to a Lien (other than
Permitted Liens) in favor of any Person (other than the Administrative Agent)
and (y) solely for the purposes of calculating the Asset Base, the sum of the
Net Book Values of all such containers owned by ICS Terminals (UK) London) shall
not at any one time exceed Five Million Dollars ($5,000,000), and (ii) the net
book value of refrigeration equipment owned by the Borrowers to be utilized with
one or more refrigerated Containers owned by the Borrowers shall also be
considered an Eligible Container for purposes of calculating the Asset Base
subject to a maximum limit at any one time of Seven Million Five Hundred
Thousand Dollars ($7,500,000).
Eligible Investments. Book-entry securities, negotiable
instruments or securities represented by instruments in bearer or registered
form, in which the Administrative Agent has a perfected security interest
pursuant to Section 3.4(c), which evidence:
(a) direct obligations of, and obligations fully guaranteed as
to the full and timely payment by, the United States of America;
(b) demand deposits, time deposits or certificates of deposit
of any depository institution or trust company incorporated under the laws of
the United States of America or any State thereof and subject to supervision and
examination by Federal or State banking or depository institution authorities;
provided, however, that at the time of the investment or contractual commitment
to invest therein, the commercial paper or other short-term unsecured debt
obligations (other than such obligations the rating of
-18-
which is based on the credit of a Person other than such depository institution
or trust company) thereof shall be rated "A-1+" by S&P and "Prime-1" by Xxxxx'x;
(c) commercial paper that, at the time of the investment or
contractual commitment to invest therein, is rated "A-1+" by S&P and "Prime-1"
by Xxxxx'x;
(d) bankers' acceptances issued by any depository institution
or trust company referred to in clause (b) above;
(e) repurchase obligations with respect to any security
pursuant to a written agreement that is a direct obligation of, or fully
guaranteed as to the full and timely payment by, the United States of America or
any agency or instrumentality thereof the obligations of which are backed by the
full faith and credit of the United States of America, in either case entered
into with (i) a depository institution or trust company (acting as principal)
described in clause (b) or (ii) a depository institution or trust company the
deposits of which are insured by the Federal Deposit Insurance Corporation and
whose commercial paper or other short-term unsecured debt obligations are rated
"A-1+" by S&P and "Prime-1" by Xxxxx'x and long-term unsecured debt obligations
are rated "AAA" by S&P and "Aaa" by Xxxxx'x;
(f) with the prior written consent of the Administrative
Agent, money market mutual funds registered under the Investment Company Act
having a rating, at the time of such investment, from each of the Rating
Agencies in the highest investment category granted thereby; and
(g) any other investment as may be acceptable to the
Administrative Agent, as evidenced by the Administrative Agent's prior written
consent to that effect.
Environmental Law. Any applicable local, state, federal, or
other laws in the United States of America, or any other laws relating to the
environment or natural resources or the regulation of releases or threatened
releases of Hazardous Substances into ambient air, water, or land, or otherwise
relating to the manufacture, processing, generation, distribution, use,
treatment, storage, disposal, cleanup, transport or handling of Hazardous
Substances, and all rules, orders and regulations currently promulgated
thereunder.
Environmental Claim. Any and all administrative, regulatory or
judicial actions, suits, orders, claims or proceedings against any Borrower or
any of its Subsidiaries under any Environmental Law or any permit issued to any
Borrower or any of its Subsidiaries under any such Environmental Law (for
purposes of this definition, "Claims"), including, without limitation, (a) any
and all Claims by governmental or regulatory authorities for enforcement,
cleanup, removal, response, remedial or other actions or damages pursuant to any
applicable Environmental Law, and (b) any and all Claims by any third party
seeking damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from Hazardous Materials or arising from alleged
injury or threat of injury to health, safety or the environment.
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Equipment Report. An Equipment Report signed by a responsible
officer of the Borrowers and in substantially the form of Exhibit C hereto.
ERISA. The Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to ERISA are to ERISA, as in effect at the date
of this Loan Agreement and any subsequent provisions of ERISA, amendatory
thereof, supplemental thereto or substituted therefor.
ERISA Affiliate. Each trade or business, whether or not
incorporated, which together with any Borrower or a Subsidiary of any Borrower
would be deemed to be a "single employer" within the meaning of Section 414(b)
or (c) of the Code.
ERISA Event. Means (a) any "reportable event", as defined in
Section 4043 of ERISA or the regulations issued thereunder, with respect to a
Plan (other than an event for which the 30-day notice period is waived); (b) the
existence with respect to any Plan of an "accumulated funding deficiency" (as
defined in Section 412 of the Code or Section 302 of ERISA, whether or not
waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d)
of ERISA of an application for a waiver of the minimum funding standard with
respect to any Plan; (d) the incurrence by any Borrower or any of their
respective ERISA Affiliates of any liability under Title IV of ERISA with
respect to the termination of any Plan or the withdrawal or partial withdrawal
of any Borrower or any of their respective ERISA Affiliates from any Plan or
Multiemployer Plan; (e) the receipt by any Borrower or any of their respective
ERISA Affiliates from the PBGC or a plan administrator of any notice relating to
the intention to terminate any Plan or Plans or to appoint a trustee to
administer any Plan; (f) the adoption of any amendment to a Plan that would
require the provision of security pursuant to Section 401(a)(29) of the Code or
Section 307 of ERISA; (g) the receipt by any Borrower or any of their respective
ERISA Affiliates of any notice, or the receipt by any Multiempoyer Plan from any
Borrower or any of their respective ERISA Affiliates of any notice, concerning
the imposition of Withdrawal Liability or a determination that a Multiemployer
Plan is, or is expected to be, insolvent or in reorganization, within the
meaning of Title IV of ERISA; or (h) the occurrence of a "prohibited
transaction" with respect to which any Borrower or any of their respective
Subsidiaries is a "disqualified person" (within the meaning of Section 4975 of
the Code) or with respect to which any Borrower or any of their respective
Subsidiaries could otherwise be liable.
Eurocurrency Reserve Rate. For any day with respect to a LIBOR
Rate Loan, the maximum rate (expressed as a decimal) at which any bank subject
thereto would be required to maintain reserves under Regulation D of the Board
of Governors of the Federal Reserve System (or any successor or similar
regulations relating to such reserve requirements) against "Eurocurrency
Liabilities" (as that term is used in Regulation D), if such liabilities were
outstanding. The Eurocurrency Reserve Rate shall be adjusted automatically on
and as of the effective date of any change in the Eurocurrency Reserve Rate.
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Event of Default. The occurrence or existence of any of the
events or conditions set forth in Section 13.1 hereof.
Existing Container Advance Rate. One of the following amounts:
(1) on the Closing Date and the initial Payment Date, the Closing Date Advance
Rate, or (2) for each Payment Date thereafter commencing April 20, 2005, an
amount equal to the difference between (i) the Closing Date Advance Rate minus
(ii) the product of (x) the Existing Container Advance Decrease Rate and (y) the
number of full calendar quarters that have elapsed since the Closing Date.
Existing Container Advance Decrease Rate. One of the following
amounts:
(1) on the Closing Date and all times thereafter until the
Asset Value Adjustment Date, one percent (1%); and
(2) at all times on or after the Asset Value Adjustment Date,
the amount determined on the Asset Value Adjustment Date in accordance
with the following formula:
1% x A/B
Where A = the sum of the Net Book Values of all Eligible
Containers owned by any Borrower on the Closing Date
calculated immediately prior to any approved increase
in such Net Book Values on the Asset Value Adjustment
Date; and
B = the sum of the Net Book Values of all Eligible
Containers owned by any Borrower on the Closing Date
calculated immediately after giving effect to any
approved increase in such Net Book Values on the
Asset Value Adjustment Date.
Fair Market Value. With respect to any asset (including a
Container), shall mean the price at which a willing buyer, not an Affiliate of
the seller, and a willing seller who does not have to sell, would agree to
purchase and sell such asset, as determined in good faith by the board of
directors or other governing body or, pursuant to a specific delegation of
authority by such board of directors or governing body, a designated senior
executive officer of any Borrower or their Subsidiaries selling such asset.
Federal Bankruptcy Code. Xxxxx 00, Xxxxxx Xxxxxx Code as in
effect from time to time (and any successor thereto).
Fee Letter. That certain fee letter, dated as of November 3,
2004, by and among the Borrowers and the Administrative Agent.
Fees. Collectively, the Commitment Fee and the fees detailed
in the Fee Letter.
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Finance Lease. Any lease that is classified as a "direct
financing lease" pursuant to GAAP.
Financial Affiliate. A Subsidiary of the bank holding company
controlling any Lender, which Subsidiary is engaging in any of the activities
permitted by Section 4(e) of the Bank Holding Company Act of 1956 (12 U.S.C.
Section 1843).
Fortis. Fortis Bank (Nederland) N.V., a naamloze vennootschap
organized under the laws of the Kingdom of The Netherlands, and its successors.
Funding Date. Each date on which a Loan is made to the
Borrowers pursuant to the terms of the Loan Agreement.
GAAP or Generally Accepted Accounting Principles. Accounting
principles which are consistent with the principles promulgated or adopted from
time to time by the Financial Accounting Standards Board, its committees and its
predecessors, including applicable statements and interpretations issued by the
American Institute of Certified Public Accounting or its committees.
Governmental Authority. Any foreign, federal, state, regional,
local, municipal or other government, or any department, commission, board,
bureau, agency, public authority or instrumentality thereof, or any court or
arbitrator.
Greybox Account. Bank account number 4074-8291 maintained by
TLI at Citibank N.A. and any replacement for such account established in
accordance with the provisions of this Loan Agreement.
Gross Lease Revenues. All of the following: (i) all income
(without reduction for expenses or costs), calculated on a cash basis in
accordance with GAAP, earned in connection with the ownership, use and/or
operation of a Container, including, but not limited to, rental, handling,
location, revenue, damage protection, interchange fees and other rental-related
charges arising from leasing of such Container, and (ii) all Casualty Proceeds,
indemnification proceeds and Sales Proceeds specifically relating to such
container.
Hazardous Substances. Those substances or materials that are
prohibited, limited or regulated by any Environmental Law.
Hedging Agreement. Any interest rate swap agreement, interest
rate cap agreement, interest rate collar agreement, interest rate futures
contract, interest rate option agreement, interest rate exchange agreement,
forward currency exchange agreement, forward rate currency agreement, forward
commodity contract, commodity swap, commodity option or other similar agreement
or arrangement to which one or more of the Borrowers (or any of their
Subsidiaries) at that time is a party, designed to protect the Borrowers (or
such Subsidiary) against fluctuations in those interest rates, exchange rates,
forward rates or commodity prices that normally arise in connection with the
Borrowers' ordinary course of business or as otherwise required to be entered
into by one
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or more of the Borrowers (or any of their Subsidiaries) pursuant to, and in
accordance with, the terms of any Loan Document.
High Yield Bonds. Any issuance by Container Holdings after the
Closing Date of notes or other debt securities in a private placement or public
offering (including a Rule 144A offering or similar transaction) the proceeds of
which are used by Container Holdings to refinance, in whole or in part, the
Seller Loan.
IO Disbursement Account. An account designated as such and
established by the Borrowers pursuant to the terms of this Loan Agreement.
IO Distributable Amount. For any Payment Date, one or more of
the following amounts, as adjusted in accordance with Section 3.1(c) hereof:
(A) if the Seller Loan is then outstanding, the amount of
interest accrued and unpaid interest, and liquidated damages, on the
then unpaid principal balance of such Seller Loan less any such amounts
related to the Seller Loan that are then on deposit in the IO
Disbursement Account; provided, however, that in calculating the amount
payable pursuant to this clause (A), the unpaid principal balance of
the Seller Loan used in such calculation shall not exceed Two Hundred
Seventy Five Million Dollars ($275,000,000) and the interest rate per
annum used in such calculation shall not exceed the lesser of (i)
eleven and one half percent (11.5%) per annum and (ii) the sum of (x)
eight and three-fourths percent (8-3/4%), plus (y) the product of (a)
one-quarter percent (1/4%) times (b) the number of full three month
periods that shall have elapsed since the Closing Date (calculated as
of the next scheduled interest payment date under the Seller Loan); and
(B) if the High Yield Bonds are outstanding, the amount of
interest accrued and unpaid interest, and liquidated damages, on the
then unpaid principal balance of the High Yield Bonds; provided,
however, that in calculating the amount payable pursuant to this clause
(B), the unpaid principal balance of the High Yield Bonds used in such
calculation shall not exceed Three Hundred Million Dollars
($300,000,000) and the interest rate per annum used in such calculation
shall not exceed the greater of (i) ten percent (10%) per annum and
(ii) such higher interest rate per annum as shall be acceptable to the
Administrative Agent and the Required Lenders;
provided, however, that the IO Distributable Amount payable on any two
consecutive Payment Dates shall in no event exceed, without the prior consent of
the Administrative Agent, Fifteen Million Eight Hundred Twelve Thousand, Five
Hundred Dollars ($15,812,500).
Incentive Arrangements. Any (a) earn-out agreements, (b) stock
appreciation rights, (c) "phantom" stock plans, (d) employment agreements, (e)
non-competition agreements and (f) incentive and bonus plans entered into by any
Borrower
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or any Consolidated Subsidiary for the benefit of, and in order to retain,
executives, officers or employees of Persons or businesses in connection with
the Acquisition.
Indebtedness. As to any Person, without duplication, means (i)
all indebtedness (including principal, interest, fees and charges) of such
Person for borrowed money, (ii) all obligations of such Person in respect of
letters of credit, bankers' acceptances, and bank guaranties issued for the
account of such Person, (iii) all indebtedness of the types described in clause
(i), (ii), (iv), (v) or (vi) of this definition secured by any Lien on any
property owned by such Person, whether or not such indebtedness has been assumed
by such Person (provided that, if the Person has not assumed or otherwise become
liable in respect of such indebtedness, such indebtedness shall be deemed to be
in an amount equal to the lesser of (A) the outstanding amount of such
Indebtedness and (B) the fair market value of the property to which such Lien
relates as determined in good faith by such Person), (iv) the aggregate amount
of all capitalized lease obligations of such Person, (v) all Contingent
Obligations of such Person, (vi) as of any date of determination, all
obligations under any interest rate hedging or under any similar type of
agreement to the extent of the amount due if such agreement were to be
terminated on such date of determination, and (vii) all obligations of such
Person issued or assumed as the deferred purchase price of property or services,
all conditional sale obligations and all obligations under any title retention
agreement (but excluding trade accounts payable and other accrued liabilities
arising in the ordinary course of business that are not overdue by 90 days or
more or are being contested in good faith by appropriate proceedings promptly
instituted and diligently conducted).
Independent Accountant. Any "Big 4" or other nationally
recognized accounting firm that is reasonably acceptable to the Administrative
Agent and that is independent with respect to the Borrowers and their
Subsidiaries within the meaning of the Securities Act of 1933, as amended, and
the applicable published rules and regulations thereunder.
Intercompany Note. A promissory note evidencing intercompany
loans made pursuant to Section 9.4(iv), substantially in the form of Exhibit R
hereto.
Intercompany Subordination Agreement. This term shall have the
meaning set forth in Section 11.17 hereof.
Interest Rate Hedging Agreement. A Hedging Agreement that
protects a Borrower against fluctuations in interest rates.
Interest Period. With respect to all or any relevant portion
of any Loan, (a) initially, the period commencing on the Funding Date of such
Loan and ending on the close of business on the day preceding the immediately
following Payment Date, and (b) thereafter, each period commencing on a Payment
Date and ending (i) for any Base Rate Loan, the day immediately preceding the
next succeeding Payment Date; and (ii) for any LIBOR Rate Loan, the day
preceding the 1, 3 or 6 month anniversary of such Payment Date, as selected by
the Borrowers and available to the Administrative Agent; provided
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that all of the foregoing provisions relating to Interest Periods are subject to
the following:
(A) if any Interest Period with respect to a LIBOR Rate Loan
would otherwise end on a day that is not a LIBOR Business Day, that
Interest Period shall be extended to the next succeeding LIBOR Business
Day unless the result of such extension would be to carry such Interest
Period into another calendar month, in which event such Interest Period
shall end on the immediately preceding LIBOR Business Day;
(B) if any Interest Period with respect to a Base Rate Loan
would end on a day that is not a Business Day, that Interest Period
shall end on the next succeeding Business Day;
(C) any Interest Period relating to any LIBOR Rate Loan that
begins on the last LIBOR Business Day of a calendar month (or on a day
for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on the last LIBOR
Business Day of a calendar month; and
(D) any Interest Period that would otherwise extend beyond the
Legal Final Payment Date shall end on the Legal Final Payment Date.
Investments. Any direct or indirect advance, loan (other than
advances to customers in the ordinary course of business that are recorded as
accounts receivable on the balance sheet of the lender) or other extensions of
credit (including by way of guarantee or similar arrangement) or capital
contribution to (by means of any transfer of cash or other property to others or
any payment for property or services for the account or use of others), or any
purchase or acquisition for value of Capital Stock, Indebtedness or other
similar instruments issued by any Person. In determining the aggregate amount of
Investments outstanding at any particular time: (a) the amount of any Investment
represented by a guaranty shall be taken at not less than the principal amount
of the obligations guaranteed and still outstanding; (b) there shall be deducted
in respect of each such Investment any amount received as a return of capital
(but only by repurchase, redemption, retirement, repayment, liquidating dividend
or liquidating distribution); (c) there shall not be deducted in respect of any
Investment any amounts received as earnings on such Investment, whether as
dividends, interest or otherwise; and (d) there shall not be deducted from the
aggregate amount of Investments any decrease in the value thereof.
Lease. All leases or contracts for use or hire of a Container
by a Lessee and a Borrower, as lessor, but only to the extent such lease or
contract relates to a Container.
Legal Final Payment Date. The Payment Date occurring in
January 2012.
Lender Affiliate. With respect to any Lender, an Affiliate of
such Lender.
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Lenders. Fortis and the other lending institutions listed on
Schedule 1 hereto and any other Person who becomes an assignee of any rights and
obligations of a Lender pursuant to Section 15.
Lessee. Any obligor under a Lease.
LIBOR Business Day. Any day on which commercial banks are open
for international business (including dealings in Dollar deposits) in London or
such other eurodollar interbank market as may be selected by the Administrative
Agent in its sole discretion acting in good faith.
LIBOR Rate. For any Interest Period with respect to a LIBOR
Rate Loan, the rate of interest equal to (i) the rate determined by the
Administrative Agent at which Dollar deposits for such Interest Period are
offered based on information presented on Page 3750 of the Dow Xxxxx Market
Service (formerly known as the Telerate Service) as of 11:00 a.m. London time on
the second LIBOR Business Day prior to the first day of such Interest Period,
divided by (ii) a number equal to 1.00 minus the Eurocurrency Reserve Rate. If
the rate described above does not appear on the Dow Xxxxx Market Service on any
applicable interest determination date, the LIBOR Rate shall be the rate
(rounded upward, if necessary, to the nearest one hundred-thousandth of a
percentage point), determined on the basis of the offered rates for deposits in
Dollars for a period of time comparable to such LIBOR Rate Loan which are
offered by four major banks in the London interbank market at approximately
11:00 a.m. London time, on the second LIBOR Business Day prior to the first day
of such Interest Period as selected by the Administrative Agent. The principal
London office of each of the four major London banks will be requested to
provide a quotation of its Dollar deposit offered rate. If at least two such
quotations are provided, the rate for that date will be the arithmetic mean of
the quotations. If fewer than two quotations are provided as requested, the rate
for that date will be determined on the basis of the rates quoted for loans in
Dollars to leading European banks for a period of time comparable to such
Interest Period offered by major banks in New York City at approximately 11:00
a.m. New York City time, on the second LIBOR Business Day prior to the first day
of such Interest Period. In the event that the Administrative Agent is unable to
obtain any such quotation as provided above, it will be considered that the
LIBOR Rate pursuant to a LIBOR Rate Loan cannot be determined.
LIBOR Rate Loan. A Loan bearing interest calculated by
reference to the LIBOR Rate.
Lien. Any mortgage, pledge, hypothecation, assignment, deposit
arrangement, security interest, encumbrance, lien (statutory or other), charge,
preference, priority or other security agreement of any kind or nature
whatsoever (including any agreement to give any of the foregoing, any
conditional sale or other title retention agreement, any financing or similar
statement or notice filed under the UCC or any similar recording or notice
statute (other than any unauthorized notice filing for which there is not
otherwise any underlying Lien or obligation), and any lease having substantially
the same effect as the foregoing).
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Loan Agreement. This Credit Agreement, including the Schedules
and Exhibits hereto.
Loan Documents. This Loan Agreement, any Hedging Agreement,
the Revolving Credit Notes, the Intercreditor Agreement, the Intercompany
Subordination Agreement, the Participation Agreement and the Security Documents.
Loan Request. This term shall have the meaning set forth in
Section 2.3.
Loans. The Closing Date Advance and the Post-Closing Advances.
Lockbox. A lockbox or post office box covered by a Lockbox
Agreement.
Lockbox Accounts. Bank accounts into which Gross Lease Revenue
are deposited, and any bank account that is hereafter created in accordance
with, and to perform the functions contemplated for "Lockbox Accounts" in
accordance with the terms of this Loan Agreement.
Lockbox Agreement. Any letter agreement, in form and substance
satisfactory to the Administrative Agent among a Lockbox Bank, TLI and the
Administrative Agent, as any such letter agreement may be amended, supplemented
or modified from time to time in accordance with its terms.
Lockbox Bank. Any of the banks at which one or more Lockbox
Accounts are maintained.
Managed Fleet. Collectively, all of the containers managed by
the Borrowers, including the Containers.
Management Fee. Collectively, the management fee and all other
amounts payable to Container Holdings, pursuant to the terms of that certain
intercompany management consulting agreement, dated November 3, 2004 by and
among TLI, TOL and Container Holdings, as in effect on the date hereof.
Manager Report. A Manager Report signed by a responsible
officer of the Borrowers and in substantially the form of Exhibit D hereto.
Margin Stock. The term shall have the meaning provided in
Regulation U.
Material Adverse Effect. With respect to any event or
occurrence of whatever nature (including any adverse determination in any
litigation, arbitration or governmental investigation or proceeding):
(a) a material adverse effect on the business, financial
condition or operations of the Borrowers taken as a whole; or
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(b) a material adverse effect on the ability of any Borrower
to perform any of its monetary Obligations under any of the Loan
Documents to which it is a party.
Moody's. Xxxxx'x Investor Service, Inc., or any successor
thereto.
Multiemployer Plan. Any multiemployer plan, as defined in
Section 4001(a)(3) of ERISA with respect to which any Borrower or any of their
respective ERISA Affiliates shall have any liability.
Net Book Value. With respect to any Container as of any date
of determination, the difference of (x) an amount equal to the sum of (i) the
Original Equipment Cost of such Container, plus (ii) any increase in the Net
Book Value of such Container to be made on the Asset Value Adjustment Date,
minus (y) the accumulated depreciation on such Container calculated in
accordance with the Depreciation Policy in effect from time to time.
Non-Excluded Taxes. Any taxes other than:
(i) income taxes, branch profits taxes, franchise taxes
or any other tax imposed on the net income of the
Lender or the Administrative Agent under the laws of
the jurisdiction (or any political subdivision of
taxing authority thereof or therein) in which such
Lender or the Administrative Agent is organized or in
which the principal office or funding office of such
Lender or the Administrative Agent is located;
(ii) any deduction, withholding or other imposition of
taxes that arises as a result of a present or former
connection between such Lender or the Administrative
Agent and the relevant jurisdiction imposing such
tax, including carrying on business in, having a
branch, agency or permanent establishment in, or
being resident in such jurisdiction but excluding any
such connection which arises solely as a result of
such Lender or the Administrative Agent having
executed, performed its obligations under or received
payment under any of the Loan Documents or otherwise
solely by virtue of the Loan Documents.
Non-U.S. Lender. This term shall have the meaning set forth in
Section 5.2.3.
Non-Wholly-Owned Subsidiary. As to any Person, each Subsidiary
of such Person which is not a Wholly-Owned Subsidiary of such Person.
Notes. The Revolving Credit Notes.
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Obligations. All indebtedness, obligations and liabilities of
any of the Borrowers to any of the Lenders and the Administrative Agent,
individually or collectively, existing on the date of this Loan Agreement or
arising thereafter, direct or indirect, joint or several, absolute or
contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, operation of law or otherwise, arising or
incurred under this Loan Agreement or any of the other Loan Documents or in
respect of any Loan or any of the Revolving Credit Notes.
Original Equipment Cost. With respect to any Container, an
amount equal to the sum of (i) the greater of (A) the vendor's or manufacturer's
invoice price of such Container and (B) with respect to those Containers owned
by the Borrowers on the Closing Date that were previously acquired by a Borrower
through an asset purchase or other acquisition, the purchase price allocated to
a Container by such Borrower in the acquisition of such Container, plus (ii)
reasonable and customary inspection, transport and initial positioning costs
necessary to put such Container in service.
Outstanding. The aggregate outstanding principal amount of the
Loans as of any date of determination.
Participant. This term shall have the meaning set forth in
Section 15.4 hereof.
Participation Agreement. The participation agreement, dated as
of November 3, 2004, among the Borrowers and the Administrative Agent, as such
agreement may be amended, modified or supplemented from time to time in
accordance with its terms.
Payment Date. The third Business Day following a Determination
Date, commencing January 27, 2005.
Payroll Account. Bank account number ____ maintained by TLI at
Citibank N.A. and any replacement for such account established in accordance
with the provisions of this Loan Agreement.
PBGC. The Pension Benefit Guaranty Corporation established
pursuant to Section 4002 of ERISA, or any successor thereto.
Permitted Business. The marine container leasing business and
any business that is the same as or similar, reasonably related, complementary,
ancillary or incidental to the marine container leasing business, including, but
not limited to, the leasing of chassis. The container logistics business, the
container purchase and resale business, and the static storage business, all as
currently engaged in by Borrowers or their Subsidiaries on the Closing Date are
also deemed to be a Permitted Business.
Permitted Disbursements. Any of the following, subject to the
conditions and limitations set forth below:
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(i) to pay Direct Operating Expenses then due and owing including
with respect to all containers included in the Managed Fleet;
(ii) to pay any Third Party Lease Payment Amount then due and
owing;
(iii) to pay Tier One Permitted Dividends;
(iv) to pay, or to pay a management fee equal to, selling, general
and administrative expenses incurred by the Borrowers during
such Collection Period; provided, that the aggregate amount of
permissible payments be made in any Collection Period pursuant
to this clause (iv) shall not exceed an amount equal to the
budgeted selling, general and administrative expenses for such
Collection Period (which budgeted amount shall be (x)
increased by the amount by which the selling, general and
administrative expenses incurred by the Borrowers during the
immediately prior Collection Period exceeded the estimate of
the amount of the payment, or the management fee paid, to the
Borrowers for such Collection Period, and (y) decreased by the
amount by which the selling, general and administrative
expenses incurred by the Borrowers during the immediately
prior Collection Period was less than the estimate of the
amount of the payment, or the management fee paid, to the
Borrowers for prior Collection Period; provided, that any
adjustment in the amount distributed for any Collection Period
pursuant to this clause (iv) by reason of the operation of
either subclause (x) or (y) above shall not affect the
calculation of any adjustment pursuant to either subclause (x)
or (y) above with respect to any future Collection Period);
(v) to fund capital expenditures to acquire additional Containers;
provided, however, that such capital expenditures shall not be
a Permitted Disbursement (i) upon the expiration or
termination of the Revolving Credit Period, (ii) if a
Designated Event of Default is then continuing, or (iii) if
after including the Eligible Containers to be acquired with
such expenditure, the Aggregate Note Principal Balance exceeds
the Asset Base;
(vi) to pay any post closing increase to the Purchase Price (as
defined in the Stock Purchase Agreement) pursuant to either
Section 2.05 or 2.06 of the Stock Purchase Agreement; and
(vii) to pay any UBS Lease Termination Payments then due and
payable.
Permitted Dividend. Any of (i) any Tier One Permitted
Dividend, (ii) any Tier Two Permitted Dividend, (iii) any Tier Three Permitted
Dividend or (iv) the dividend contemplated in Section 3.6(b) hereof.
Permitted Holders. The Resolute Fund L.P., The Jordan Company,
L.P., Xxxxxx & Company Limited, Edgewater Private
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Equity Fund III, L.P., Edgewater Private Equity Fund IV, L.P., Fairholme
Partners, L.P., Fairholme Ventures II, LLC, Fairholme Holdings, Ltd., JZ Equity
Partners plc and their respective Affiliates.
Permitted Liens. This term shall have the meaning set forth in
Section 9.3 hereof.
Permitted Securitization. A transaction pursuant to which (i)
one or more of the Borrowers and/or their respective Subsidiaries sells, conveys
or otherwise transfers, or grants a security interest in, containers, leases and
other related assets to a Special Purpose Vehicle or any other Person (other
than the Borrowers or any of their respective Subsidiaries), (ii) such Special
Purpose Vehicle or such other Person issues Indebtedness (or interests therein)
that is secured by such containers, leases and other related assets, (iii) none
of the Borrowers or any of their respective Subsidiaries has any obligation to
maintain such entity's financial condition or cause such entity to achieve
certain levels of operating results (other than those related to or incidental
to the relevant Permitted Securitization), (iv) none of the holders of the
Indebtedness shall have recourse to the Borrowers or any of their Subsidiaries
for credit losses on leases or the inability of the containers, in each case
subject to the Permitted Securitization, to generate sufficient cash flow to
repay the Indebtedness issued by such entity and (v) in consideration for the
sales or transfers referred to in clause (i) above, when aggregated with the
proceeds of all substantially concurrent financings, the Borrowers receive a
sufficient amount of cash proceeds to repay in full all of the Obligations or
such lesser amount as shall be acceptable to the Administrative Agent and the
Required Lenders.
Person. An individual, any partnership, a corporation, a joint
venture, a trust, an unincorporated organization, or a government or any agency
or political subdivision thereof.
Plan. Any employee pension plan (other than a Multiemployer
Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code
or Section 307 of ERISA, and in respect of which any Borrower or any of their
respective ERISA Affiliates is an "employer" as defined in Section 3(5) of
ERISA.
Pledge Agreement. This term shall have the meaning provided in
Section 11.15.
Pledge Agreement Collateral. This term shall mean all of the
"Collateral" as defined in the Pledge Agreement.
Post-Closing Advance Rate. One of the following amount: (1)
for the period commencing on the Closing Date and ending on the last day of the
Revolving Credit Period, eighty percent (80%); or (2) for each Payment Date
thereafter, an amount equal to the difference between (i) eighty percent (80%),
minus (ii) the product of (x) one percent (1%), and (y) the number of full
calendar quarters that have elapsed since the last day of the Revolving Credit
Period; provided, however, that (i) if any Container to be acquired with the
proceeds of a Post-Closing Advance is not acquired by a Borrower either directly
from the manufacturer thereof or from a Lessee in connection with a
sale-
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leaseback transaction (so long as the average age of all containers included in
such sale-leaseback does not exceed eighteen months), (ii) such Container is not
being acquired by a Borrower in a transaction (or a series of related
transactions) involving containers having a purchase price in excess of Ten
Million Dollars ($10,000,000), and (iii) the sum of all Containers then owned by
all of the Borrowers collectively that were not acquired by a Borrower directly
from the manufacturer thereof does not exceed Twenty Five Million Dollars
($25,000,000), then the Post-Closing Advance Rate applicable to such Containers
shall be the Existing Container Advance Rate; and provided further, that the
advance rate applicable to any Container in excess of the limitations set forth
in clauses (ii) or (iii) that were not acquired by a Borrower directly from the
manufacturer thereof or from a Lessee in connection with a sale-leaseback
transaction (so long as the average age of all containers included in such
sale-leaseback does not exceed eighteen months) and that does not comply with
the provisions of either clause (ii) or (iii) in the above proviso shall be
determined by the Administrative Agent.
Post-Closing Advances. Loans made or to be made by the Lenders
to the Borrowers pursuant to Section 2.2 hereof.
Preferred Equity. With respect to the Capital Stock of any
Person means Capital Stock of such Person (other than common stock of such
Person) of any class or classes (however designated) that ranks prior, as to the
payment of dividends or as to the distribution of assets upon any voluntary or
involuntary liquidation, dissolution or winding up of such Person, to Capital
Stock of any other class of such Person.
Public Equity Offering. An underwritten public offering of
common stock of Container Holdings, any holding company of Container Holdings,
TLI, TOL or TOCC pursuant to a registration statement filed with the Securities
and Exchange Commission (other than on Form S-8).
Purchased Entities. Transamerica Leasing Inc., Trans Ocean
Ltd., Transamerica Leasing do Brasil Ltda., Trans Ocean Container Corporation,
Spacewise Inc., Transamerica Leasing N.V., Transamerica Leasing SRL, ICS
Terminals (UK) Limited, Trans Ocean Regional Corporate Holdings, Transamerica
Leasing Pty. Ltd., Transamerica Leasing GmbH, Transamerica Leasing (HK) Ltd.,
Greybox Logistics Services Inc., Intermodal Equipment Inc., Greybox Services
Ltd. and Transamerica Leasing Limited.
Record. The grid attached to a Revolving Credit Note, or the
continuation of such grid, or any other similar record, including computer
records, maintained by the Administrative Agent with respect to any Loan
referred to in such Note.
Refinance. In respect of any security or Indebtedness, means
to refinance, extend, renew, refund, repay, prepay, redeem, defease or retire,
or to issue a security or Indebtedness in exchange or replacement for, such
security or Indebtedness in whole or in part. Refinanced and Refinancing shall
have correlative meanings.
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Refinancing Event. Either of the following: (i) placement into
the asset backed securities term market of notes sufficient to repay in full all
of the Obligations (or such lesser amount as shall be acceptable to the
Administrative Agent), or (ii) a repayment in full from an alternate source of
funds all of the Obligations (or such lesser amount as shall be acceptable to
the Administrative Agent).
Refinancing Indebtedness. Any Refinancing by a Borrower or any
Subsidiary of Indebtedness incurred in accordance with clause (i), (vi), (vii),
(viii) or (xi) of Section 9.4, in each case that does not:
(1) have an aggregate principal amount (or, if such Indebtedness
is issued with original issue discount, an aggregate offering
price) greater than the sum of (x) the aggregate principal
amount of the Indebtedness being Refinanced (or, if such
Indebtedness being Refinanced is issued with original issue
discount, the aggregate accreted value) as of the date of such
proposed Refinancing plus (y) the amount of fees, expenses,
premium, defeasance costs and accrued but unpaid interest
relating to the Refinancing of such Indebtedness being
Refinanced; or
(2) create Indebtedness with: (a) a Weighted Average Life to
Maturity that is less than the Weighted Average Life to
Maturity of the Indebtedness being Refinanced; or (b) a final
maturity earlier than the final maturity of the Indebtedness
being Refinanced.
Register. This term shall have the meaning set forth in
Section 15.3.
Regulation T. Regulation T of the Board of Governors of the
Federal Reserve System as from to time in effect and any successor to all or any
portion thereof.
Regulation U. Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or a portion thereof.
Regulation X. Regulation X of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor to all
or any portion thereof.
Related Assets. With respect to any Container, all of the
following: (i) all of a Borrower's right, title and interest in and to, but none
of its obligations under, any agreement between such Borrower and the
manufacturer of each such container pursuant to which such Borrower acquired a
container from such manufacturer, and all amendments, additions and supplements
hereafter made with respect thereto, (ii) all of a Borrower's right, title and
interest in and to any Lease which such container is subject to from time to
time, including all lease revenues accrued on or after the date specified in the
Stock Purchase Agreement, (iii) all right, title and interest of such Borrower
in and to all payments, proceeds and other amounts which have accrued but have
not been paid and (iv) all payments, proceeds and income of the foregoing or
related thereto.
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Related Parties. With respect to any Person, such Person's
Affiliates and the partners, directors, officers, employees, agents and advisors
of such Person and of such Person's Affiliates.
Required Lenders. As of any date of determination, any single
Lender or multiple Lenders having more than 50% of the sum of the portion of the
Aggregate Commitments unfunded at such date plus the aggregate outstanding
principal amount of the Loans or, if the commitment of each Lender to make Loans
has been terminated pursuant to Section 13.2, any single or multiple Lenders
holding in the aggregate more than 50% of the outstanding principal amount of
the Loans; provided that the Commitment of, and the portion of the outstanding
principal amount of the Loans held or deemed held by, any Defaulting Lender
shall be excluded for purposes of making a determination of Required Lenders.
Revolving Credit Note. This term shall have the meaning set
forth in Section 2.4.
Revolving Credit Note Record. A Record with respect to a
Revolving Credit Note.
Revolving Credit Period. The period commencing on the Closing
Date and ending on the earlier to occur of (i) the date on which the Commitments
are terminated pursuant to Sections 2.5 or 13.2 hereof, and (ii) the two year
anniversary of the Closing Date.
Sales Proceeds. The net cash sale proceeds of a Container or
other asset sold by a Borrower in accordance with the terms of this Loan
Agreement less:
(i) reasonable out-of-pocket expenses and fees relating to
such sale (including, without limitation, legal, accounting and
investment banking and other fees and sales commissions); provided,
however, that no such investment banking fee shall be payable with
respect to sales of Containers by a Borrower or any of its Subsidiaries
made in the ordinary course of such Person's business;
(ii) repayment of, or any other payments made in respect of,
Indebtedness that is secured by the property or assets that are the
subject of such sale which (a) is required to be repaid in connection
with such sale or (b) is paid in order to obtain a necessary consent to
such sale;
(iii) appropriate amounts to be provided by a Borrower or any
of its Subsidiaries, as the case may be, as a reserve, in accordance
with GAAP, against any liabilities associated with such sale and
retained by such Borrower or such Subsidiary, as the case may be, after
such sale, including, without limitation, pension and other
post-employment benefit liabilities, liabilities related to
environmental matters and liabilities under any indemnification
obligations associated with such sale; and
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(iv) any portion of the purchase price from such sale placed
in escrow, whether as a reserve for adjustment of the purchase price,
for satisfaction of indemnities in respect of such sale or otherwise in
connection with such sale; provided, that upon the termination of such
escrow, Sales Proceeds will be increased by any portion of funds in
such escrow that are released to a Borrower or any of its Subsidiaries.
Security Agreement. This term shall have the meaning set forth
in Section 11.8.
Security Documents. The Security Agreement, the Pledge
Agreement, the Lockbox Agreements and other instruments and documents,
including, without limitation, Uniform Commercial Code financing statements (or
documents of similar import) and filings made with the United States Patent and
Trademark Office and United States Copyright Office, required to be executed or
delivered pursuant to any Security Document.
Seller Loan. The loan (including any Exchange Notes issued
pursuant to the terms of such agreement) to Container Holdings evidenced by the
senior subordinated credit agreement, dated as of November 3, 2004, among
Container Holding, Transamerica Accounts Holding Corporation, as agent, and the
lenders named therein, as such agreement may be amended, modified or
supplemented from time to time in accordance with the provisions of such
agreement and the Loan Documents.
Senior Designated Officer. With respect to a Borrower, the
Chief Executive Officer, the President, the Chief Financial Officer or any Vice
President of such Borrower.
Special Purpose Vehicle. A corporation, partnership, trust,
limited liability company or other entity that is formed by one or more of the
Borrowers or one of their Subsidiaries for the purpose of purchasing or
financing assets of the Borrowers and/or its Subsidiaries pursuant to any
Permitted Securitization and that is designated as a "Special Purpose Vehicle"
in a written notice delivered to the Administrative Agent by the Borrowers.
Specialized Containers. All refrigerated containers, tank
containers, special purposes containers, open top containers, flat rack
containers, bulk containers, high cube containers (other than 40' high cube dry
containers), cellular palletwide containers and all other types of containers
other than standard dry cargo containers.
S&P. Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc., or any successor thereto.
State. Any state of the United States of America.
Stock Purchase Agreement. That certain Stock Purchase
Agreement, dated as of July 10, 2004, by and between TA Leasing Holding Co, Inc.
and Xxxxxx &
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Company Limited, as such agreement may be amended, modified or supplemented from
time to time in accordance with its terms.
Subsidiary. With respect to any Person shall mean and include
(i) any corporation more than 50% of whose stock of any class or classes having
by the terms thereof ordinary voting power to elect a majority of the directors
of such corporation (irrespective of whether or not at the time stock of any
class or classes of such corporation shall have or might have voting power by
reason of the happening of any contingency) is at the time owned by such Person
directly or indirectly through one or more Subsidiaries of such Person and (ii)
any partnership, association, limited liability company, joint venture or other
entity (other than a corporation) in which such Person directly or indirectly
through one or more Subsidiaries of such Person, has more than a 50 Capital
Stock at the time.
Systems/Organizational Establishment Expenses. The aggregate
of all expenditures (whether paid in cash or accrued as liabilities) by
Container Holdings and the Consolidated Subsidiaries in financial, information
technology and other similar systems of Container Holdings and its Consolidated
Subsidiaries.
TEU. The abbreviation used for twenty foot equivalent units.
Term Lease. A lease having an initial term of 36 months or
greater.
Third Party Lease Payment Amount. As of any date of
determination, all amounts then owning to third party owners of containers
included in the Managed Fleet (other than the Borrowers) in accordance with the
terms of their respective management agreements.
Tier One Permitted Dividend. Any of:
(i) the payment of any dividend or other distribution or
redemption within 60 days after the date of declaration of such
dividend or call for redemption if such payment would have been
permitted on the date of declaration or call for redemption;
(ii) items described in clauses (i), (iv), (v), (vi),
(viii), (ix) and (xiv) of Section 9.5 hereof;
(iii) payments, advances or dividends to any direct or
indirect parent entity of a Borrower to be used by such entity solely
to pay its franchise taxes, directors fees, registration and reporting
fees, fees and expenses associated with state qualifications and other
state, federal or regulatory compliance matters, fees and expenses of
accountants and other fees, costs and expenses owing by it in the
ordinary course of business; provided, that all such payments, advances
or dividends are in an aggregate amount not to exceed $2.0 million in
any fiscal year, and shall actually be used by such entity to pay such
amounts;
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(iv) payments, advances or dividends to any direct or indirect
parent entity of a Borrower to be used by such entity solely to pay
indemnification payments to one or more of its officers and directors;
(v) dividends or distributions to any Borrower or any
Subsidiary of any Borrower;
(vi) advances to any direct or indirect parent entity of a
Borrower to be used by such entity solely to pay federal, state and
local income taxes made no earlier than five days prior to the date on
which such entity is required to make such payment in an amount not to
exceed the aggregate tax liability of the Borrowers and their
Subsidiaries for such calendar year determined as if the Borrowers and
their Subsidiaries were a separate affiliated group (as defined in
Section 1504 of the Internal Revenue Code of 1986, as amended) filing a
consolidated return, or, to the extent applicable, a separate group
filing combined or unitary returns, and then only to the extent that
any such payments are actually paid by such entity to governmental
entities and any payments made in connection with any tax-sharing
agreement; and
(vii) cash payments in lieu of the issuance of fractional
shares in connection with the exercise of warrants, options or other
securities convertible into or exchangeable for Capital Stock (other
than Disqualified Stock) of a Borrower; provided, that any such cash
payment shall not (A) be for the purpose of evading the limitations of
Section 9.6 (as determined in good faith by the Board of Directors of
the applicable Borrower), and (B) exceed one hundred thousand dollars
($100,000) in any fiscal year.
Tier Three Permitted Dividend. Any of:
(i) the acquisition of any shares of Capital Stock (other than
Disqualified Stock) of any Borrower, solely in exchange for other
shares of Capital Stock (other than Disqualified Stock) of any
Borrower;
(ii) an Investment either (i) solely in exchange for shares of
Capital Stock (other than Disqualified Stock) of any Borrower or (ii)
through the application of the net proceeds of a sale for cash (other
than to a Subsidiary of a Borrower) of shares of Capital Stock (other
than Disqualified Stock) of any Borrower within 60 days after such
sale;
(iii) repurchases of Capital Stock deemed to occur upon
exercise of stock options, warrants or other similar rights if such
Capital Stock represents a portion of the exercise price of such
options, warrants or other similar rights;
(iv) the purchase, redemption or other acquisition or
retirement for value of any Capital Stock of such Person owned by a
Borrower or any Subsidiary of a Borrower;
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(v) Dividends made to effect a Permitted Securitization;
provided, however, that no such distribution shall be made to Container
Holdings pursuant to this clause (v); and
(vi) any Dividend made out of the net cash proceeds or the
fair market value of other assets received by a Borrower from any
Person (other than a Subsidiary of a Borrower) from the substantially
concurrent sale of, or made by exchange for, Capital Stock (other than
Disqualified Stock) of such Borrower or a substantially concurrent
capital contribution received by a Borrower from its stockholders.
Tier Two Permitted Dividend. Any of:
(i) the purchase, repurchase, retirement, redemption or other
acquisition of shares of Capital Stock of a Borrower, any Subsidiary of
a Borrower or any direct or indirect parent of a Borrower from
employees, former employees, directors, former directors or consultants
of a Borrower, any Subsidiary of a Borrower or any direct or indirect
parent of a Borrower (or permitted transferees of such employees,
former employees, directors or former directors), pursuant to the terms
of the agreements (including employment agreements) or plans (or
amendments thereto) approved by the Board of Directors of a Borrower or
of any direct or indirect parent of a Borrower under which such
individuals purchase or sell or are granted the option to purchase or
sell, shares of such Capital Stock; provided, that the aggregate amount
of such repurchases and other acquisitions in any calendar year shall
not exceed the lesser of (i) the sum of (x) $5 million and (y) the
aggregate amount of Tier Two Permitted Dividends permitted (but not
made) pursuant to this clause (i) in prior calendar years and (ii)
$10.0 million; provided further, that such amount in any calendar year
may be increased by an amount not to exceed the net cash proceeds of
key man life insurance policies received by a Borrower or any direct or
indirect parent of a Borrower after the Closing Date;
(ii) the payment of the Management Fee or payments, advances
or dividends to any direct or indirect parent entity of a Borrower to
be used by such entity solely to pay the Management Fee.
TLI. Transamerica Leasing Inc., a corporation organized under
the laws of the State of Delaware, and its successors and permitted assigns.
After the closing of the Transactions, the name of Transamerica Leasing Inc.
will be changed to TAL International Container Corporation.
TOCC. Trans Ocean Container Corporation, a corporation
organized under the laws of the State of Delaware, and its successors and
permitted assigns.
TOL. Trans Ocean Ltd., a corporation organized under the laws
of the State of Delaware, and its successors and permitted assigns.
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Transaction. All of the following, collectively: (i) the
consummation of the acquisitions set forth in the Stock Purchase Agreement, and
(ii) the entering into of the Loan Documents and the incurrence of the Closing
Date Advance.
Trust Account. A bank account established by the Borrowers in
accordance with the provisions of Section 3.1 hereof.
Type. As to all or any portion of any Loan, its nature as a
Base Rate Loan or a LIBOR Rate Loan.
UBS Lease Agreement. The Equipment Lease Agreement
(Transamerica Loan Trust No. 1996-A) (L-2), dated December 30, 1996, between
State Street Bank and Trust Company of Connecticut, National Association, in its
capacity as owner trustee, as lessor, and Trans Ocean Container Corporation, as
lessee. A true, complete and correct copy of such lease as in effect on the
Closing Date is attached as Exhibit I hereto.
UBS Lease Termination Payment. The early termination option
payment(s) to be made by TOCC pursuant to the terms of the UBS Lease Agreement,
which payouts as of the Closing Date are set forth on Schedule 5 hereto.
UCC. The Uniform Commercial Code as in effect from time to
time in the applicable jurisdiction.
Unfunded Current Liability. With respect to a Plan shall mean
the amount, if any, by which the value of the accumulated plan benefits under
the Plan determined on a plan termination basis in accordance with actuarial
assumptions at such time consistent with those prescribed by the PBGC for
purposes of Section 4044 of ERISA, exceeds the fair market value of all plan
assets allocable to such liabilities under Title IV of ERISA (excluding any
accrued but unpaid contributions).
Voting Stock. Stock or similar interests, of any class or
classes (however designated), the holders of which are at the time entitled, as
such holders, to vote for the election of a majority of the directors (or
persons performing similar functions) of the corporation, association, trust or
other business entity involved, whether or not the right so to vote exists by
reason of the happening of a contingency.
Weighted Average Life to Maturity. When applied to any
Indebtedness at any date, means the number of years obtained by dividing (1) the
then outstanding aggregate principal amount of such Indebtedness into (2) the
sum of the total of the products obtained by multiplying:
(A) the amount of each then remaining installment, sinking
fund, serial maturity or other required payment of principal, including
payment at final maturity, in respect thereof, by
(B) the number of years (calculated to the nearest
one-twelfth) which will elapse between such date and the making of such
payment.
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Wholly-Owned Subsidiary. As to any Person, (i) any corporation
100% of whose Capital Stock (other than director's qualifying shares and/or
other nominal amounts of shares required by applicable law to be held by Persons
other than such Person) is at the time owned by such Person and/or one or more
Wholly-Owned Subsidiaries of such Person and (ii) any partnership, limited
liability company, association, joint venture or other entity in which such
Person and/or one or more Wholly-Owned Subsidiaries of such Person owns 100% of
the Capital Stock at such time (other than director's qualifying shares and/or
other nominal amounts of interests required by applicable law to be held by
Persons other than such Person).
Withdrawal Liability. Liability to a Multiemployer Plan as a
result of a complete or partial withdrawal from such Multiemployer Plan, as such
terms are defined in Part I of Subtitle E of Title IV of ERISA.
1.2. RULES OF INTERPRETATION.
(a) A reference to any document or agreement shall include
such document or agreement as amended, modified or supplemented from
time to time in accordance with its terms and the terms of this Loan
Agreement.
(b) The singular includes the plural and the plural includes
the singular.
(c) A reference to any law includes any amendment or
modification to such law.
(d) A reference to any Person includes its permitted
successors and permitted assigns.
(e) Accounting terms not otherwise defined herein have the
meanings assigned to them by GAAP applied on a consistent basis by the
accounting entity to which they refer.
(f) The words "include", "includes", and "including" are not
limiting.
(g) All terms not specifically defined herein or by GAAP,
which terms are defined in the Uniform Commercial Code as in effect in
the State of New York, have the meanings assigned to them therein, with
the terms "instrument" and "chattel paper" being that defined under
Article 9 of the Uniform Commercial Code.
(h) Reference to a particular "ss." or Section refers to that
section of this Loan Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of
like import shall refer to this Loan Agreement as a whole and not to
any particular section or subdivision of this Loan Agreement.
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(j) Unless otherwise expressly indicated, in the computation
of periods of time from a specified date to a later specified date, the
word "from" means "from and including," the words "to" and "until" each
mean "to but excluding," and the word "through" means "to and
including."
(k) This Loan Agreement and the other Loan Documents may use
several different limitations, tests or measurements to regulate the
same or similar matters. All such limitations, tests and measurements
are, however, cumulative and are to be performed in accordance with the
terms thereof.
(l) This Loan Agreement and the other Loan Documents are the
result of negotiation among, and have been reviewed by counsel to,
among others, the Administrative Agent, the Lenders and the Borrowers
and are the product of discussions and negotiations among all parties.
Accordingly, this Loan Agreement and the other Loan Documents are not
intended to be construed against the Administrative Agent or any of the
Lenders merely on account of the Administrative Agent's or any Lender's
involvement in the preparation of such documents.
2. THE CLOSING DATE ADVANCE AND NEW CONTAINER ADVANCES.
2.1. CLOSING DATE ADVANCE. Subject to the terms and conditions
set forth in this Loan Agreement, each Lender severally agrees to make
a Loan to the Borrowers collectively on the Closing Date in an amount
equal to its Commitment Percentage of an amount equal to the lesser of
(A) Eight Hundred Twenty Million Dollars ($820,000,000), and (B) the
Asset Base on the Closing Date.
2.2. POST-CLOSING LOAN. Subject to the terms and conditions
set forth herein, each Lender severally agrees to make loans (each such
loan, a "Post-Closing Advance") to the Borrowers from time to time, on
any Business Day during the Revolving Credit Period; provided, however,
that after giving effect to all amounts requested, the Aggregate Note
Principal Balance shall not exceed the lesser of (i) Aggregate
Commitments and (ii) the Asset Base, calculated after giving effect to
the Eligible Containers, if any, to be acquired with the proceeds of
such Post-Closing Advance. Post-Closing Advances shall be LIBOR Rate
Loans or under the circumstances set forth in Section 5.4 or Section
5.5 hereof, a Base Rate Loan.
2.3. REQUESTS FOR LOAN. The Borrowers shall give to the
Administrative Agent written notice in the form of Exhibit E hereto (or
telephonic notice confirmed in a writing in the form of Exhibit E
hereto) of each Loan requested hereunder (a "Loan Request") no later
than 3:00 p.m. (Amsterdam time) three (3) LIBOR Business Days prior to
any proposed Funding Date. Each such Loan Request shall specify (i) the
principal amount of the Loan requested, (ii) the proposed Funding Date
of such Loan and (iii) the Interest Period for such
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Loan Advance. Each Loan Request shall be irrevocable and binding on the
Borrowers and shall obligate the Borrowers to accept the Closing Date
Advance or Post-Closing Advance, as the case may be, requested from the
Lenders on the proposed Funding Date. Each Loan Request shall be in a
minimum aggregate amount of $2,500,000. No Loan Request shall be
permitted to request any Loan on or after the Availability Termination
Date, on which date any unfunded portion of the Commitments shall
terminate, automatically and without notice or action of any kind.
2.4. THE REVOLVING CREDIT NOTES. The Loans shall be evidenced
by separate promissory notes of the Borrowers in substantially the form
of Exhibit F hereto (each a "Revolving Credit Note"), dated as of the
Closing Date (or such other date on which a Lender may become a party
hereto in accordance with Section 15 hereof) and completed with
appropriate insertions. One Revolving Credit Note shall be payable to
the order of each Lender in a principal amount equal to such Lender's
Commitment to make Loans or, if less, the outstanding amount of all
Closing Date Advances and Post-Closing Advances made by such Lender,
plus interest accrued thereon, as set forth below. The Borrowers
irrevocably authorizes each Lender to make or cause to be made, at or
about the time of the Funding Date of any Loan or at the time of
receipt of any payment of principal on such Lender's Revolving Credit
Note, an appropriate notation on such Lender's Revolving Credit Note
Record reflecting the making of such Loan or (as the case may be) the
receipt of such payment. The outstanding amount of the Loans set forth
on such Lender's Revolving Credit Note Record shall be prima facie
evidence absent manifest error of the principal amount thereof owing
and unpaid to such Lender, but the failure to record, or any error in
so recording, any such amount on such Lender's Revolving Credit Note
Record shall not limit or otherwise affect the obligations of the
Borrowers hereunder or under any Revolving Credit Note to make payments
of principal of or interest on any Revolving Credit Note when due.
2.5. TERMINATION OR REDUCTION OF COMMITMENTS. The Borrowers
may, upon notice to the Administrative Agent, terminate the Aggregate
Commitments, or from time to time permanently reduce the Aggregate
Commitments; provided that (i) any such notice shall be received by the
Administrative Agent not later than 3:00 p.m. (Amsterdam time) three
(3) Business Days prior to the date of termination or reduction, (ii)
any such partial reduction shall be in an aggregate amount of
$5,000,000 or any whole multiple of $1,000,000 in excess thereof, and
(iii) the Borrowers shall not terminate or reduce the Aggregate
Commitments prior to the Availability Termination Date if, after giving
effect thereto and to any concurrent prepayments hereunder, the
Aggregate Note Principal Balance would exceed the Aggregate
Commitments. The Administrative Agent will promptly notify the Lenders
of any such notice of termination or reduction of the Aggregate
Commitments. Any reduction of the Aggregate Commitments shall be
applied to the Commitment of each Lender according to its Commitment
Percentage. All fees accrued until the effective date
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of any termination or reduction of the Aggregate Commitments shall be
paid on the effective date of such termination or reduction.
2.6. REPAYMENT OF PRINCIPAL OF LOANS. (a) Subject to the
provisions of Section 13.1 hereof relating to the acceleration of the
Revolving Credit Notes and the other Obligations hereunder, the
Borrowers shall pay to each Lender on each Payment Date, solely from
funds released from the Trust Account on such Payment Date in
accordance with the priority of payments set forth in Section 3.1(c)
hereof and solely to the extent payable thereunder pursuant to Section
3.1(c), as a principal payment on its Revolving Credit Note in an
amount equal to its pro rata share of (i) the Asset Base Deficiency (if
any) for such Payment Date and (ii) any amount required to be repaid in
accordance with the provisions of Section 4.2.1 hereof. The unpaid
principal balance of, and all accrued interest and other amounts owing
on, or with respect to, the Revolving Credit Notes shall be payable in
full on the earlier to occur of (x) the Legal Final Maturity Date and
(y) the date on which the Revolving Credit Notes and the other
Obligations have been declared due and payable in accordance with the
provisions of Section 13.1 hereof.
2.7. FUNDING BY LENDERS; PRESUMPTION BY ADMINISTRATIVE AGENT.
Unless the Administrative Agent shall have received notice from a
Lender prior to the proposed Funding Date that such Lender will not
make available to the Administrative Agent such Lender's share of such
requested Loan, the Administrative Agent may assume that such Lender
has made such share available on such date in accordance with Sections
2.1 or 2.2, as the case may be, and may, in reliance upon such
assumption, make available to the Borrowers a corresponding amount. In
such event, if a Lender has not in fact made its share of the
applicable requested Loan available to the Administrative Agent, then
the applicable Lender agrees to pay to the Administrative Agent
forthwith on demand such corresponding amount in immediately available
funds with interest thereon, for each day from and including the date
such amount is made available to the Borrowers to, but excluding, the
date of payment to the Administrative Agent, at, in the case of a
payment to be made by such Lender, the greater of the Federal Funds
Rate and a rate determined by the Administrative Agent in accordance
with banking industry rules on interbank compensation. If such Lender
pays its share of the applicable Loan to the Administrative Agent, then
the amount so paid shall constitute such Lender's portion of the
requested Loan.
2.8. FAILURE TO SATISFY CONDITIONS PRECEDENT. If any Lender
makes available to the Administrative Agent funds for any Loan to be
made by such Lender as provided in the provisions of this Loan
Agreement, and such funds are not made available to the Borrowers by
the Administrative Agent because the conditions to the applicable Loan
set forth in Sections 11 and 12 are not satisfied or waived in
accordance with the terms hereof, the Administrative Agent shall return
such funds (in like funds as received from such Lender) to such Lender,
without interest.
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2.9. OBLIGATIONS OF LENDERS SEVERAL. The obligations of the
Lenders hereunder to make Loans and to make payments pursuant to this
Loan Agreement are several and not joint. The failure of any Lender to
make any Loan or to make any payment under this Loan Agreement on any
date required hereunder shall not relieve any other Lender of its
corresponding obligation to do so on such date, and no Lender shall be
responsible for the failure of any other Lender to so make its Loan or
to make its payment under this Loan Agreement.
2.10. JOINT AND SEVERAL OBLIGATION. Each of the Borrowers
hereby agrees that it is jointly and severally liable for all of the
Obligations, regardless of the actual allocation of the proceeds of the
Loans among the Borrowers. Each of the Borrowers accepts joint and
several liability for all Obligations hereunder in consideration of the
financial accommodation to be provided by the Lenders to each of the
Borrowers under this Loan Agreement, for the mutual benefit, directly
and indirectly, of each Borrower and in consideration of the
undertakings by each other Borrower to accept joint and several
liability for the Obligations.
Each Borrower jointly and severally hereby irrevocably and
unconditionally accepts, not merely as a surety but also as a
co-debtor, joint and several liability with each Borrower with respect
to the payment and performance of all of the Obligations, it being the
intention of the parties hereto that all of the Obligations shall be
the joint and several obligations of each of the Borrowers without
preferences or distinction among them.
If and to the extent that any Borrower shall fail to make any
payment with respect to any of the Obligations as and when due or to
perform any of the Obligations in accordance with the terms thereof,
then in each such event, the other Borrowers will make such payment
with respect to, or perform, such Obligations.
The obligations of each Borrower under the provisions of this
Section 2.10 constitute full recourse obligations of such Borrower,
enforceable against it to the full extent of its properties and assets,
irrespective of the validity, regularity or enforceability of this Loan
Agreement or any other Loan Document against any other Borrower or any
other circumstances whatsoever that under applicable law might
constitute a defense to the joint and several Obligations of such other
Borrower.
Except as otherwise expressly provided herein, each Borrower
hereby waives notice of acceptance of its joint and several liability,
notice of any and all Obligations incurred hereunder or under any other
Loan Document, notice of the occurrence of any Default or Event of
Default, or of any demand for any payment hereunder or any other Loan
Document, notice of any action at any time taken or omitted by the
Administrative Agent or any Lender under or in respect of any of the
Obligations, any requirement of diligence and,
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generally, all demands, notices and other formalities of every kind in
connection with the Obligations, this Loan Agreement or any other Loan
Document. Each Borrower hereby assents to, and waives notice of, any
extension or postponement of the time for the payment of any of the
Obligations, the acceptance of any partial payment thereon, any waiver,
consent or other action or acquiescence by the Administrative Agent or
any Lender at any time or times in respect of any default by any
Borrower in the performance or satisfaction of any term, covenant,
condition or provision hereunder or under this Loan Agreement or any
other Loan Document, any and all other indulgences whatsoever by the
Administrative Agent or any Lender in respect of any of the
Obligations, and the taking, addition, substitution or release, in
whole or in part, at any time or times, of any security for any of the
Obligations or the addition, substitution or release, in whole or in
part, of any Borrower. Without limiting the generality of the
foregoing, each Borrower assents to any other action or delay in acting
or failure to act on the part of the Administrative Agent or any
Lender, including, without limitation, any failure strictly or
diligently to assert any right or to pursue any remedy or to comply
fully with applicable laws or regulations thereunder which might, but
for the provisions of this Section 2.10, afford grounds for
terminating, discharging or relieving such Borrower, in whole or in
part, from any of its obligations under this Section 2.10, it being the
intention of each Borrower that, so long as any of the Obligations
remain unsatisfied, the obligations of such Borrower shall not be
discharged except by performance and then only to the extent of such
performance. The Obligations of each Borrower shall not be diminished
or rendered unenforceable by any winding up, reorganization,
arrangement, liquidation, reconstruction or similar proceeding with
respect to any other Borrower or the other Lender. The joint and
several liability of each Borrower hereunder shall continue in full
force and effect notwithstanding any absorption, merger, amalgamation
or any other change whatsoever in the name, membership, constitution or
place of formation of any other Borrower.
The provisions of this Section 2.10 are made for the benefit
of the Administrative Agent and each Lender and their successors and
assigns, and may be enforced by such party from time to time against
any Borrower as often as occasion therefore may arise and without
requirement on the part of the Administrative Agent or any Lender first
to marshal any of its claims or to exercise any of its rights against
any other Borrower or to exhaust any remedies available to it against
any other Borrower or to resort to any other source or means of
obtaining payment of any of the Obligations or to elect any other
remedy. The provisions of this Section 2.10 shall remain in effect
until all the Obligations shall have been paid in full or otherwise
fully satisfied. If at any time, any payment, or any part thereof, made
in respect of any of the Obligations, is rescinded or must otherwise be
restored or returned by the
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Administrative Agent or any Lender upon the insolvency, bankruptcy or
reorganization of any Borrower, or otherwise, the provisions of this
Section 2.10 will forthwith be reinstated in effect, as though such
payment had not been made.
2.11. REVOLVING CREDIT FACILITY. The credit facility evidenced
by this Loan Agreement is a revolving credit facility. Accordingly, the
Borrowers will, subject to compliance with the terms of this Loan
Agreement, have the right during the Revolving Credit Period to
reborrow any amounts repaid to the Lenders in accordance with the terms
of this Loan Agreement.
3. COLLECTION AND DISBURSEMENTS OF FUNDS.
3.1. TRUST ACCOUNT.
(a) Within thirty (30) days after the Closing Date, the
Borrowers will establish and maintain the Trust Account with a bank or
trust company acceptable to the Administrative Agent, which account
shall be under the "control" (as defined in the UCC) of the
Administrative Agent for the benefit of the Lenders.
(b) The Borrowers shall not change the location of the Trust
Account without the prior written consent of the Administrative Agent
in each instance.
(c) On each Payment Date, the Administrative Agent, based on
the Manager Report, shall distribute an amount equal to the sum of: (1)
all amounts transferred to the Trust Account from the Concentration
Account on the immediately preceding Business Day in accordance with
the provisions of Section 3.2 hereof, and (2) any earnings on
investments in the Trust Account that were credited to the Trust
Account during the related Collection Period (the sum of (1) and (2),
the "Distributable Cash Flow"), shall be distributed to the following
Persons in the following order of priority, with no payment being made
toward any item unless and until all prior items have been fully
satisfied:
(i) An amount equal to the sum of (A) interest payments
then due and owing on the Revolving Credit Notes, (B) all
Commitment Fees then due and owing, (C) the Agent Fee then due
and owing, and (D) all regularly scheduled payments (excluding
termination payments) on any Hedging Agreement(s) then due and
owing, all such payments to be paid on a pari passu basis;
(ii) One of the following amounts:
(A) If no Acceleration Event has occurred and is
continuing to pay, on a pari passu basis, (i) termination
payments (if any) on any Interest Rate Hedging Agreement
maintained by the Borrowers in accordance with the terms
of the Loan Documents, and (ii) the principal balance of
the Revolving Credit
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Notes in an amount sufficient to ensure that, after giving
effect to such payment, no Asset Base Deficiency is then
continuing; or
(B) If an Acceleration Event has occurred and is
continuing to pay, on a pari passu basis, (i) termination
payments (if any) on any Interest Rate Hedging Agreements
maintained by the Borrowers in accordance with the terms
of the Loan Documents, and (ii) the then Aggregate Note
Principal Balance until such balance is reduced to zero.
(iii) To the extent that no Designated Event of Default is
then continuing or would result from such payment, to the IO
Disbursement Account the amount of the IO Distributable Amount
for such Payment Date and, if the due date for the next
succeeding interest payment on the Seller Loan and/or the High
Yield Bonds will occur prior to the next succeeding Payment
Date, the amount of the IO Distributable Amount will be
increased by the interest to be accrued from the current
Payment Date to the due date of such interest payment on the
Seller Loan and/or the High Yield Bonds, as the case may be;
(iv) To the extent that no Designated Event of Default is
then continuing or would result from such payment, (A) in
payment of the Management Fee then due and payable, and (B)
without duplication of the amount set forth in clause (A), the
aggregate amount of Tier Two Permitted Dividends that are to
be paid during the period commencing on such Payment Date and
terminating on the next following Payment Date;
(v) To the Administrative Agent and the Lenders, to pay
any increased cost, indemnities, taxes and other amounts then
due and owing pursuant to the terms of the Loan Documents,
including Sections 5.6, 5.7, 5.9 or 16.3 hereof;
(vi) All remaining Distributable Cash Flow to be used to
repay the unpaid principal balance of the Revolving Credit
Notes until the Aggregate Note Principal Balance has been
reduced to zero; and
(vii) To the Borrowers in equal amounts, any remaining
Distributable Cash Flow.
If the amounts to be distributed on any Payment Date are not sufficient to make
payment in full to the Lenders with respect to any of the clauses described in
Section 3.1(c) above, then payments to Lenders pursuant to any such clause will
be allocated among such Lenders on a pro rata basis based on the amount payable
to each such Lender pursuant to each such clause.
3.2. CONCENTRATION ACCOUNT.
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(a) On or prior to the Closing Date, TLI shall establish the
Concentration Account with Citibank N.A. for the purpose of (i)
receiving periodic transfers of funds from the Lockbox Account and all
other cash remittances received by the Borrowers in the ordinary course
of business, (ii) funding disbursements to be made from each of the
Accounts Payable Account and the Payroll Account and (iii) receiving
and/or transferring funds to the Greybox Account. Each of the
Concentration Account, the Accounts Payable Account and the Payroll
Account shall be titled exclusively in the name of TLI and, at all
times during the term of this Loan Agreement, TLI will cause each such
account to be under the "control" (as defined in the UCC) of the
Administrative Agent.
(b) TLI shall be permitted to withdraw, from time to time,
funds from the Concentration Account in order to fund Permitted
Disbursements, which Permitted Disbursements may be paid directly from
the Concentration Account or paid from either the Accounts Payable
Account or the Payroll Account with funds transferred from the
Concentration Account.
(c) On the Business Day preceding each Payment Date, TLI shall
transfer from the Concentration Account to the Trust Account funds in
an amount equal to the excess of (i) all funds received in, and
investment earnings credited to, the Concentration Account during the
immediately preceding Collection Period, over (ii) the sum of (x) all
Permitted Disbursements made from the Concentration Account during such
Collection Period, and (y) Five Million Dollars ($5,000,000).
3.3. LOCKBOX ACCOUNTS.
(a) Each Lockbox Bank shall be instructed by TLI to transfer
to the related Lockbox Account, on a daily basis, all items received in
the applicable Lockbox and to remit to the Concentration Account, on a
daily basis (but subject to the Lockbox Bank's customary funds
availability schedule), all amounts deposited in the Lockbox Accounts
maintained with such Lockbox Bank. Upon the occurrence and continuation
of a Designated Event of Default, the Administrative Agent is hereby
authorized and empowered, as the TLI's attorney-in-fact, to endorse any
item deposited in a Lockbox or presented for deposit in any Lockbox
Account requiring the endorsement of TLI, which authorization is
coupled with an interest. Each Lockbox Account shall be subject to the
"control" of the Administrative Agent within the meaning of the UCC.
(b) TLI may, from time to time after the Closing Date,
designate a new account as a Lockbox Account (and a new lockbox or post
office box relating thereto as a Lockbox), and such account shall
become a Lockbox Account (and the bank at which such account is
maintained shall become a Lockbox Bank, and such lockbox or post office
box shall become a Lockbox for purposes of this Loan Agreement);
provided that the Administrative Agent shall have received not less
than ten (10) Business Days' prior written notice of the account (and
related lockbox or post office box) and/or the bank that are proposed
to be added and, not less
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than five (5) Business Days prior to the effective date of any such
proposed addition, the Administrative Agent shall have received (i) an
executed acknowledgment from such bank in form and substance to the
Administrative Agent establishing the "control" of the Administrative
Agent over such post office box and/or lockbox account and (ii) copies
of all other agreements and documents signed by the new bank or such
other parties with respect to such Lockbox.
(i) TLI may, from time to time after the Closing Date,
terminate an account as a Lockbox Account; provided that no
such termination shall occur unless the Administrative Agent
shall have received not less than five (5) Business Days'
prior written notice of the account and/or the bank that are
proposed to be terminated, and prior to the effective date of
any such proposed termination, the Administrative Agent shall
have received counterparts of an agreement, duly executed by
the applicable bank and reasonably satisfactory in form and
substance to the Administrative Agent; establishing the
"control" of the Administrative Agent over such post office
box and/or lockbox account.
3.4. INVESTMENTS.
(a) Funds which may at any time be held in the Concentration
Account, the IO Disbursement Account or the Trust Account may be
invested and reinvested by TLI in one or more Eligible Investments in
the manner specified in Section 3.4(c) hereof.
(b) Each investment made pursuant to this Section 3.4 on any
date shall mature not later than the Business Day immediately preceding
the Payment Date next succeeding the day such investment is made,
except that any investment made on the day preceding a Payment Date
shall mature on such Payment Date.
(c) Subject to the other provisions hereof, the Administrative
Agent shall have sole "control" (as defined in the UCC) over each such
investment and the income thereon, and any certificate or other
instrument evidencing any such investment, if any, shall be delivered
directly to the Administrative Agent or its agent, together with each
document of transfer, if any, necessary to transfer title to such
investment to the Administrative Agent.
(d) All monies on deposit in the Concentration Account, the IO
Disbursement Account and the Trust Account, together with any deposits
or securities in which such moneys may be invested or reinvested, and
any gains from such investments, shall constitute Collateral.
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3.5. GENERAL PROVISIONS REGARDING LOCKBOX ACCOUNT,
CONCENTRATION ACCOUNT, ACCOUNTS PAYABLE ACCOUNT, PAYROLL
ACCOUNT AND IO DISBURSEMENT ACCOUNT.
(a) TLI shall cause each such depository institution or trust
company maintaining any of the Lockbox Account, the Concentration
Account, the Accounts Payable Account, the IO Disbursement Account and
the Payroll Account to execute a written agreement, in form and
substance satisfactory to the Administrative Agent. TLI shall give the
Administrative Agent at least five (5) Business Days' prior written
notice of any change in the location of any Lockbox Account,
Concentration Account, Accounts Payable Account, the IO Disbursement
Account and Payroll Account or in any related account information.
Anything herein to the contrary notwithstanding, unless otherwise
consented to by the Administrative Agent in writing, TLI shall have no
right to change the location of any such account.
(b) Upon the written request of the Administrative Agent, TLI
shall cause, at the expense of the Administrative Agent, the depository
institution at which any account is located to forward to the
Administrative Agent copies of all monthly account statements for each
of the Lockbox Account, Concentration Account, Accounts Payable
Account, the IO Disbursement Account and Payroll Account.
(c) If at any time TLI wishes to transfer an existing account
or establishes a new account, TLI shall notify the Administrative Agent
of such fact and shall establish within five (5) Business Days of such
determination, in accordance with paragraph (a) of this Section 3.5, a
successor account thereto at another depository institution or trust
company acceptable to the Administrative Agent and shall establish
successor accounts. TLI shall cause such depository institution to
execute a written agreement under terms provided for in paragraph (a)
of this Section.
3.6. IO DISBURSEMENT ACCOUNT.
(a) Within thirty (30) days after the Closing Date, the
Borrowers will establish and maintain the IO Disbursement Account with
a bank or trust company acceptable to the Administrative Agent, which
account shall be under the "control" (as defined in the UCC) of the
Administrative Agent for the benefit of the Lenders.
(b) On each Payment Date, amounts will be deposited into the
IO Disbursement Account in accordance with priority of payments set
forth in Section 3.1(c) hereof. All amounts on deposit in the IO
Disbursement Account shall be made available to the Borrowers on the
due date of each interest payment on the Seller Loan and /or the High
Yield Bonds, as the case may be, to be used as a permitted dividend to
Container Holdings.
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4. PROVISIONS APPLICABLE TO ALL LOANS.
4.1. INTEREST ON LOANS.
4.1.1. INTEREST RATES. (a) Except as otherwise provided in
Section 5.10, the Loans shall bear interest during each Interest Period
relating to all or any portion of the Loans at the following rates:
(i) To the extent that all or any portion of a Loan
bears interest during such Interest Period at the Base Rate,
such Loan or such portion shall bear interest during such
Interest Period at the rate per annum equal to the sum of (i)
the Applicable Margin and (ii) the Base Rate in effect from
time to time.
(ii) To the extent that all or any portion of a Loan
bears interest during such Interest Period based on the LIBOR
Rate, such Loan or such portion shall bear interest during
such Interest Period at a rate per annum equal to the sum of
(i) the LIBOR Rate and (ii) the Applicable Margin.
The Borrowers promise to pay interest on the Loans or any portion
thereof outstanding during each Interest Period in arrears on each
Payment Date.
(b) In no event shall the interest charged with respect to a
Loan exceed the maximum amount permitted by applicable law. If at any
time the interest rate charged with respect to a Loan exceeds the
maximum rate permitted by applicable law, the rate of interest to
accrue pursuant to such Loan shall be limited to the maximum rate
permitted by applicable law.
4.1.2. AMOUNTS. Any portion of the Loans bearing interest
based on the LIBOR Rate relating to any Interest Period shall be in the
amount of $500,000 or an integral multiple thereof. No Interest Period
relating to a Loan or any portion thereof bearing interest at the LIBOR
Rate shall extend beyond the date on which a regularly scheduled
installment payment of the principal of such Loan is to be made.
4.2. MANDATORY REPAYMENTS OF THE LOANS.
4.2.1. REPAYMENTS IN CONNECTION WITH THE ASSET BASE. On each
Payment Date, the Borrowers shall, out of the funds released from the
Trust Account on such Payment Date pursuant to Section 3.1(c), repay
the Loans to the extent of remaining Distributable Cash Flow available
for such purposes pursuant to clause (vi) of Section 3.1(c) hereof. Any
such repayment pursuant to the provisions of this Section 4.2.1 shall
not be subject to the provisions of Section 4.3 hereof.
4.2.2. APPLICATION OF PAYMENTS. All payments made pursuant to
Section 4.2.1 or Section 4.3, and all applications of funds released
from the Trust Account
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on any Payment Date and applied pursuant to Section 3.1(c)(iii) and
3.1(c)(vii), shall be applied pro rata among the Existing Container
Advance and the Post-Closing Advances.
4.3. OPTIONAL PREPAYMENT OF LOANS. The Borrowers shall have
the right at any time to prepay one or more of the Loans on or before
the Legal Final Payment Date, as a whole, or in part, upon delivery of
written notice to the Administrative Agent not later than 1:00 p.m.
(New York City time) on the Business Day prior to such prepayment,
without premium or penalty, provided that (a) each partial prepayment
shall be in the principal amount of $2,500,000 or multiples of $500,000
in excess thereof and (b) in the event that any LIBOR Rate Loan is
prepaid at any time other than the end of an Interest Period applicable
thereto (a "Breakage Prepayment"), the Borrowers shall pay, upon
demand, to each Lender an amount equal to such Lender's Breakage Cost.
The Administrative Agent will promptly notify each Lender of its
receipt of each such notice, and of the amount of such Lender's
Commitment Percentage of such prepayment. Any prepayment of principal
of a Loan shall include all interest accrued to the date of prepayment.
Each such prepayment shall be applied to the Loans of the Lenders in
accordance with their respective Commitment Percentages.
4.4. PAYMENTS BY BORROWER; PRESUMPTIONS BY ADMINISTRATIVE
AGENT. Unless the Administrative Agent shall have received notice from
the Borrowers prior to the date on which any payment is due to the
Administrative Agent for the account of the Lenders hereunder that the
Borrowers will not make such payment, the Administrative Agent may
assume that the Borrowers have made such payment on such date in
accordance herewith and may, in reliance upon such assumption,
distribute to the Lenders the amount due. In such event, if the
Borrowers have not in fact made such payment, then each of the Lenders
severally agrees to repay to the Administrative Agent forthwith on
demand the amount so distributed to such Lender, in immediately
available funds with interest thereon, for each day from and including
the date such amount is distributed to it to but excluding the date of
payment to the Administrative Agent, at the greater of the Federal
Funds Rate and a rate determined by the Administrative Agent in
accordance with banking industry rules on interbank compensation. A
notice of the Administrative Agent to any Lender or the Borrowers with
respect to any amount owing under this Section 4.5 shall be conclusive,
absent manifest error.
4.5. SHARING OF PAYMENTS BY LENDERS. If any Lender shall, by
exercising any right of setoff or counterclaim or otherwise, obtain
payment in respect of any principal of or interest on any of the Loans
made by it resulting in such Lender's receiving payment of a proportion
of the aggregate amount of such Loans or and accrued interest thereon
greater than its pro rata share thereof as provided herein, then the
Lender receiving such greater proportion shall (a) notify the
Administrative Agent of such fact, and (b) purchase (for cash at face
value) participations in the Loans of the other Lenders, or make such
other adjustments
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as shall be equitable, so that the benefit of all such payments shall
be shared by the Lenders ratably in accordance with the aggregate
amount of principal of and accrued interest on their respective Loans
and other amounts owing them, provided that:
(i) if any such participations are purchased and all or any
portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to
the extent of such recovery, without interest; and
(ii) the provisions of this Section shall not be construed to
apply to (x) any payment made by the Borrowers pursuant to and in
accordance with the express terms of this Loan Agreement or (y) any
payment obtained by a Lender as consideration for the assignment of or
sale of a participation in any of its Loans to any assignee or
participant, other than to the Borrowers or any of their Affiliates (as
to which the provisions of this Section shall apply).
The Borrowers consent to the foregoing and agree, to the
extent they may effectively do so under applicable law, that any Lender
acquiring a participation pursuant to the foregoing arrangements may
exercise against the Borrowers rights of setoff and counterclaim with
respect to such participation as fully as if such Lender were a direct
creditor of the Borrowers in the amount of such participation.
4.6. FUNDING SOURCE. Nothing herein shall be deemed to
obligate any Lender to obtain the funds for any Loan in any particular
place or manner or to constitute a representation by any Lender that it
has obtained or will obtain the funds for any Loan in any particular
place or manner.
5. CERTAIN GENERAL PROVISIONS.
5.1. FEES.
5.1.1. COMMITMENT FEE. The Borrowers agrees to pay on each
Payment Date during the Revolving Credit Period to the Administrative
Agent for the accounts of the Lenders in accordance with their
respective Commitment Percentages a commitment fee (the "Commitment
Fee") calculated at the rate of one half of one percent (0.50%) per
annum on the average daily amount during the related Collection Period
by which the Aggregate Commitment in respect of the Loan exceeds the
Aggregate Note Principal Balance during such calendar quarter. The
Commitment Fee shall be payable in arrears on each Payment Date for the
immediately preceding Collection Period commencing on the first such
date following the date hereof, with a final payment on the expiration
or termination of the Revolving Credit Period.
5.1.2. OTHER FEES. The Borrowers shall pay to the
Administrative Agent for its own account fees in the amount and at the
times specified in the Fee Letter.
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Such fees shall be fully earned when paid and shall not be refundable
for any reason whatsoever. The Borrowers shall also pay to the Lenders
such fees as shall have been separately agreed upon in writing in the
amounts and at the times so specified. Such fees shall be fully earned
when paid and shall not be refundable for any reason whatsoever.
5.2. FUNDS FOR PAYMENTS.
5.2.1. PAYMENTS TO ADMINISTRATIVE AGENT. All payments of
principal, interest, Fees and any other amounts due hereunder or under
any of the other Loan Documents shall be made on the due date thereof
to the Administrative Agent in Dollars, for the accounts of the Lenders
and the Administrative Agent, at the Administrative Agent's Office or
at such other place that the Administrative Agent may from time to time
designate, in each case at or about 11:00 a.m. (Rotterdam, The
Netherlands time or other local time at the place of payment) and in
immediately available funds. The Borrowers hereby authorize the
Administrative Agent to effect all payments due hereunder or under any
of the other Loan Documents when due by directly withdrawing such funds
from the Trust Account or any other accounts as the Borrowers shall
maintain with the Administrative Agent, without any prior notice from
the Administrative Agent to the Borrowers. The Administrative Agent
agrees to notify the Borrowers following any such payment.
5.2.2. NO OFFSET, ETC.
(a) Subject to Section 5.2.3, all payments by the Borrowers
hereunder and under any of the other Loan Documents shall be made
without recoupment, setoff or counterclaim and free and clear of and
without deduction for any taxes (including interest, penalties and
additions to tax), levies, imposts, duties, charges, fees, deductions,
withholdings, compulsory loans, restrictions or conditions of any
nature now or hereafter imposed or levied by any jurisdiction or any
political subdivision thereof or taxing or other authority therein
unless the Borrowers are compelled by law to make such deduction or
withholding. If any Non-Excluded Taxes are imposed upon the Borrowers
with respect to any amount payable by it hereunder or under any of the
other Loan Documents, the Borrowers will pay to the Administrative
Agent, for the account of the Lenders or (as the case may be) the
Administrative Agent, on the date on which such amount is due and
payable hereunder or under such other Loan Document, such additional
amount in Dollars as shall be necessary to enable the Lenders or the
Administrative Agent to receive the same net amount which the Lenders
or the Administrative Agent would have received on such due date had no
such Non-Excluded Taxes been imposed upon the Borrowers. The Borrowers
will deliver promptly to the Administrative Agent certificates or other
valid vouchers for all taxes or other charges deducted from or paid
with respect to payments made by the Borrowers under such other Loan
Document.
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(b) In addition, the Borrowers agree to pay to the relevant
Governmental Authority in accordance with applicable law any current or
future stamp or documentary taxes or any other excise or property
taxes, charges or similar levies (including, without limitation,
mortgage recording taxes, transfer taxes and similar fees) imposed by
the United States or any taxing authority thereof or therein that arise
from any payment made hereunder ("Other Taxes").
(c) Subject to Section 5.2.3, the Borrowers agree to indemnify
the Lenders and the Administrative Agent for the full amount of
Non-Excluded Taxes (including additional amounts with respect thereto)
and Other Taxes, and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto, provided that the
Lenders or the Administrative Agent, as the case may be, shall have
provided the Borrowers with evidence, reasonably satisfactory to the
Borrowers, of payment of Non-Excluded Taxes or Other Taxes, as the case
may be.
(d) Any Lender or the Administrative Agent that becomes
entitled to the payment of additional amounts pursuant to Section
5.2.2(a) shall use reasonable efforts (consistent with applicable law)
to file any document reasonably requested by the relevant Borrower or,
if a Lender, to change the jurisdiction of its applicable lending
office if the making of such a filing or change of office, as the case
may be, would avoid the need for or reduce the amount of any payment of
such additional amounts that may thereafter accrue and would not, in
the good faith determination of such Lender or the Administrative
Agent, as applicable, be disadvantageous to it.
(e) If a Lender or the Administrative Agent receives any
refund with respect to taxes for which the Borrowers have paid any
additional amounts pursuant to Section 5.2.2(a)U, then such Lender or
the Administrative Agent, as applicable, shall promptly pay to the
Borrowers the portion of the sum of such refund and any interest
received with respect thereto as it determines, in its reasonable, good
faith judgment, will leave it, after such payment, in no better or
worse financial position than it would have been absent the imposition
of such taxes and the payment of such additional amounts pursuant to
Section 5.2.2(a)U; provided, however, that (i) the Borrowers agree to
promptly return any amount paid to the Borrowers pursuant to this
Section 5.2.2(d)U upon notice from such Lender or the Administrative
Agent, as applicable, that such refund or any portion thereof is
required to be repaid to the relevant taxing authority, (ii) nothing in
this Section 5.2.2(e) shall require a Lender to disclose any
confidential information to the Borrowers (including, without
limitation, its tax returns), and (iii) no Lender shall be required to
pay any amounts pursuant to this Section 5.2.2(e) at any time which a
Default or Event of Default exists.
(f) If the Borrowers determine in good faith that a reasonable
basis exists for contesting any Non-Excluded Taxes for which additional
amounts have been paid pursuant to Section 5.2.2(a), the relevant
Lender or Administrative
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Agent (to the extent such Person reasonably determines in good faith
that it will not suffer any adverse effect as a result thereof) shall
cooperate with the Borrowers in challenging such Non-Excluded Taxes, at
the Borrowers' expense, if so requested by the Borrowers in writing.
5.2.3. NON-U.S. LENDERS. Each Lender and the Administrative
Agent that is not a U.S. Person as defined in Section 7701(a)(30) of
the Code for U.S. federal income tax purposes (a "Non-U.S. Lender")
hereby agrees that it shall, prior to the date of the first payment by
the Borrowers hereunder to be made to such Lender or the Administrative
Agent or for such Lender's or the Administrative Agent's account (and
thereafter when required to the extent it is legally entitled to do
so), deliver to the Borrowers and the Administrative Agent, as
applicable, such certificates, documents or other evidence, as and when
required by the Code, including (a) two (2) duly completed copies of
Internal Revenue Service Form W-8BEN or Form W-8ECI and any other
certificate or statement of exemption required by the Code, or any
subsequent versions thereof or successors thereto, properly completed
and duly executed by such Lender or the Administrative Agent
establishing that with respect to payments of principal, interest or
fees hereunder it is (i) not subject to United States federal
withholding tax under the Code because such payment is effectively
connected with the conduct by such Lender or Administrative Agent of a
trade or business in the United States or (ii) totally exempt from
United States federal withholding tax under a provision of an
applicable tax treaty or (b) in the case of a Non-U.S. Lender that is
not legally entitled to deliver the forms specified in clause (a) and
that is not a "bank" for purposes of Section 881(c)(3)(A) of the Code,
a certificate in form and substance reasonably satisfactory to the
Administrative Agent and the Borrower and to the effect that (i) such
Non-U.S. Lender is not a "bank" for purposes of Section 881(c)(3)(A) of
the Code, is not subject to regulatory or other legal requirements as a
bank in any jurisdiction, and has not been treated as a bank for
purposes of any tax, securities law or other filing or submission made
to any governmental authority, any application made to a rating agency
or qualification for any exemption from any tax, securities law or
other legal requirements, (ii) is not a ten (10) percent shareholder
for purposes of Section 881(c)(3)(B) of the Code and (iii) is not a
controlled foreign corporation receiving interest from a related person
for purposes of Section 881(c)(3)(C) of the Code, together with a
properly completed Internal Revenue Service Form W-8BEN; provided, that
an Administrative Agent that delivers the forms and certificate
provided in clause (b) above must also deliver to the Borrowers two
accurate, complete and signed copies of either Internal Revenue Service
Form W-8BEN or W-8ECI, or, in each case, an applicable successor form,
establishing a complete exemption from withholding of U.S. federal
income tax imposed on the payment of any fees to such Administrative
Agent. Each Lender agrees that it shall, promptly upon a change of its
lending office or the selection of any additional lending office, to
the extent the forms previously delivered by it pursuant to this
section are no longer effective, and promptly upon the Borrower's or
the Administrative Agent's reasonable request after the occurrence of
any other event
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(including the passage of time) requiring the delivery of a Form W-8BEN
or Form W-8ECI in addition to or in replacement of the forms previously
delivered, deliver to the Borrower and the Administrative Agent, as
applicable, if and to the extent it is properly entitled to do so, a
properly completed and executed Form W-8BEN or Form W-8ECI, as
applicable (or any successor forms thereto). For any period with
respect to which such Lender or Administrative Agent has failed to
provide the Borrowers with the appropriate form or other relevant
document pursuant to this Section 5.2.3 establishing a complete
exemption from U.S. federal withholding tax (unless such failure is due
to a change in treaty, law, or regulation occurring subsequent to the
date on which a form originally was required to be provided), such
Lender or Administrative Agent shall not be entitled to any "gross-up"
of Taxes or indemnification under Section 5.2.2 with respect to
Non-Excluded Taxes or Other Taxes imposed by the United States;
provided, however, that should such a Lender or Administrative Agent,
which is otherwise exempt from a withholding tax, become subject to
Non-Excluded Taxes or Other Taxes because of its failure to deliver a
form required hereunder, the Borrowers shall take such steps as such
Lender or Administrative Agent shall reasonably request, at such
Lender's or Administrative Agent's expense, to assist such Lender or
Administrative Agent to recover such Non-Excluded Taxes or Other Taxes.
5.3. COMPUTATIONS. All computations of interest on the Loans
and of Fees shall be based on a 360-day year (or 365 day year with
respect to interest calculations on Base Rate Loans) and paid for the
actual number of days elapsed. Except as otherwise provided in the
definition of the term "Interest Period" with respect to LIBOR Rate
Loans, whenever a payment hereunder or under any of the other Loan
Documents becomes due on a day that is not a Business Day, the due date
for such payment shall be extended to the next succeeding Business Day,
and interest shall accrue during such extension. The outstanding amount
of any Revolving Credit Note as reflected on its Record from time to
time shall, absent manifest error, be considered correct and binding on
the Borrowers unless within five (5) Business Days after receipt of any
notice by the Administrative Agent or any of the Lenders of such
outstanding amount, the Administrative Agent or such Lender shall
notify the Borrowers to the contrary.
5.4. INABILITY TO DETERMINE LIBOR RATE. In the event, prior to
the commencement of any Interest Period relating to any LIBOR Rate
Loan, any Lender shall determine that (a) adequate and reasonable
methods do not exist for ascertaining the LIBOR Rate that would
otherwise determine the rate of interest to be applicable to any LIBOR
Rate Loan during any Interest Period or (b) the LIBOR Rate determined
or to be determined for such Interest Period will not adequately and
fairly reflect the cost to such Lender of making or maintaining their
LIBOR Rate Loans during such period, such Lender shall forthwith give
notice of such determination (which shall be conclusive and binding on
the Borrower) to the Borrower and the Administrative Agent. In such
event (i) any Loan Request with respect to LIBOR Rate Loans shall be
automatically
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withdrawn and shall be deemed a request for Base Rate Loans, (ii) each
LIBOR Rate Loan will automatically, on the last day of the then current
Interest Period relating thereto, become a Base Rate Loan, and (iii)
the obligations of the Lenders to make LIBOR Rate Loans shall be
suspended until the Administrative Agent determines that the
circumstances giving rise to such suspension no longer exist, whereupon
the Administrative Agent shall so notify the Borrowers and the Lenders
and each Base Rate Loan shall automatically convert to a LIBOR Rate
Loan on the last day of the then current Interest Period.
5.5. ILLEGALITY. Notwithstanding any other provisions herein,
if any present or future law, regulation, treaty or directive or the
interpretation or application thereof shall make it unlawful for any
Lender to make or maintain LIBOR Rate Loans, such Lender shall
forthwith give notice of such circumstances to the Borrowers, the
Administrative Agent and the other Lenders and thereupon (a) the
commitment of such Lender to make LIBOR Rate Loans shall forthwith be
suspended until such time as the condition giving rise to such
illegality no longer exists and (b) such Lender's Loans then
outstanding as LIBOR Rate Loans, if any, shall be converted
automatically to Base Rate Loans on the last day of each Interest
Period applicable to such LIBOR Rate Loans or within such earlier
period as may be required by law. The Borrowers hereby agrees promptly
to pay the Administrative Agent for the account of such Lender, upon
demand by such Lender, any additional amounts necessary to compensate
such Lender for any costs incurred by such Lender in making any
conversion in accordance with this Section 5.5, including any interest
or fees payable by such Lender to lenders of funds obtained by it in
order to make or maintain its LIBOR Rate Loans hereunder. If the
Administrative Agent determines that the condition giving rise to such
illegality no longer exists, the Administrative Agent shall promptly
notify the Borrowers and the Lender, and each Base Rate Loan shall
automatically convert to a Libor Rate Loan on the last day of the
current Interest Period.
5.6. ADDITIONAL COSTS, ETC. If any present or future
applicable law, which expression, as used herein, includes statutes,
rules and regulations thereunder and interpretations thereof by any
competent court or by any governmental or other regulatory body or
official charged with the administration or the interpretation thereof
and requests, directives, instructions and notices at any time or from
time to time hereafter made upon or otherwise issued to any Lender or
the Administrative Agent by any central bank or other fiscal, monetary
or other authority (whether or not having the force of law), shall:
(a) impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Loan Agreement) any
special deposit, reserve, assessment, liquidity, capital adequacy or
other similar requirements (whether or not having the force of law)
against assets held by, or deposits in or for the account of, or loans
by, or letters of credit issued by, or commitments of an office of any
Lender, or
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(b) impose on any Lender or the Administrative Agent any other
conditions or requirements with respect to this Loan Agreement, the
other Loan Documents, the Loans, such Lender's Commitment or any class
of loans or commitments of which any of the Loans form a part, and the
result of any of the foregoing is
(i) to increase the cost to any Lender of making,
funding, issuing, renewing, extending or maintaining any of
the Loans, or
(ii) to reduce the amount of principal, interest, or
other amount payable such Lender or the Administrative Agent
hereunder on account of such Lender's Commitment or any of the
Loans, or
(iii) to require such Lender or the Administrative Agent
to make any payment or to forego any interest or other sum
payable hereunder, the amount of which payment or foregone
interest or other sum is calculated by reference to the gross
amount of any sum receivable or deemed received by such Lender
or the Administrative Agent from the Borrowers hereunder,
then, and in each such case, the Borrowers will, upon demand made by
such Lender or (as the case may be) the Administrative Agent at any
time and from time to time and as often as the occasion therefor may
arise, pay to such Lender or the Administrative Agent such additional
amounts as will be sufficient to compensate such Lender or the
Administrative Agent for such additional cost, reduction, payment or
foregone interest or other sum (other than taxes which shall be treated
exclusively pursuant to Section 5.2.2).
The failure or delay on the part of any Lender to demand
compensation for any increased costs shall not constitute a waiver of
such Lender's right to demand such compensation; provided, that no
Borrower shall be under any obligation to compensate any Lender under
this Section 5.6 for any increased costs with respect to any period
prior to the date that is 120 days prior to such request if such Lender
knew of the circumstances giving rise to such increased costs and of
the fact that such circumstances would result in a claim for increased
compensation by reason of such increased costs.
5.7. CAPITAL ADEQUACY. If after the date hereof any Lender or
the Administrative Agent determines that (a) the adoption of or change
in any law, governmental rule, regulation, policy, guideline or
directive (whether or not having the force of law) regarding capital
requirements for banks or bank holding companies or any change in the
interpretation or application thereof by a Governmental Authority with
appropriate jurisdiction, or (b) compliance by such Lender or the
Administrative Agent or any corporation controlling such Lender or the
Administrative Agent with any law, governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law)
of any such entity
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regarding capital adequacy, has the effect of reducing the return on
such Lender's or the Administrative Agent's commitment with respect to
any Loans to a level below that which such Lender or the Administrative
Agent could have achieved but for such adoption, change or compliance
(taking into consideration such Lender's or the Administrative Agent's
then existing policies with respect to capital adequacy and assuming
full utilization of such entity's capital) by any amount deemed by such
Lender or (as the case may be) the Administrative Agent to be material,
then such Lender or the Administrative Agent may notify the Borrowers
of such fact. To the extent that the amount of such reduction in the
return on capital is not reflected in the Base Rate, the Borrowers
agree to pay such Lender or (as the case may be) the Administrative
Agent for the amount of such reduction in the return on capital as and
when such reduction is determined upon presentation by such Lender or
(as the case may be) the Administrative Agent of a certificate in
accordance with Section 5.8 hereof. Such Lender or (as the case may be)
the Administrative Agent shall allocate such cost increases among its
customers in good faith and on an equitable basis.
The failure or delay on the part of any Lender to demand
compensation for any reduction in amounts received or receivable or
reduction in return on capital shall not constitute a waiver of such
Lender's right to demand such compensation; provided, that no Borrower
shall be under any obligation to compensate any Lender under this
Section 5.7 for any reductions with respect to any period prior to the
date that is 120 days prior to such request if such Lender knew of the
circumstances giving rise to such reductions and of the fact that such
circumstances would result in a claim for increased compensation by
reason of such reductions.
5.8. CERTIFICATE. A certificate setting forth any additional
amounts payable pursuant to Sections 5.6 or 5.7 and a brief explanation
of such amounts which are due, submitted by any Lender or the
Administrative Agent to the Borrowers, shall be conclusive, absent
manifest error, that such amounts are due and owing.
5.9. INDEMNITY. The Borrowers agree to indemnify each Lender
and to hold each Lender harmless from and against any loss, cost or
expense (including loss of anticipated profits) that such Lender may
sustain or incur as a consequence of (a) default by the Borrowers in
payment of the principal amount of or any interest on any LIBOR Rate
Loans as and when due and payable, including any such loss or expense
arising from interest or fees payable by such Lender to lenders of
funds obtained by it in order to maintain its LIBOR Rate Loans, (b)
default by the Borrowers in making a borrowing after the Borrower has
given (or is deemed to have given) a Loan Request relating thereto in
accordance with Section 2.3, or (c) the making of any payment of a
LIBOR Rate Loan that is not the last day of the applicable Interest
Period with respect thereto, including interest or fees payable by such
Lender to lenders of funds obtained by it in order to maintain any such
Loans.
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5.10. INTEREST AFTER DEFAULT. Overdue principal and (to the
extent permitted by applicable law) overdue interest on the Loans and
all other overdue amounts payable hereunder or under any of the other
Loan Documents shall bear interest compounded monthly and payable on
demand at a rate per annum equal to two percent (2%) above the then
applicable rate of interest under this Loan Agreement or the other Loan
Documents until such amount shall be paid in full (after as well as
before judgment).
6. COLLATERAL SECURITY.
6.1. SECURITY OF BORROWERS. Subject to the Security Documents,
the Obligations are and shall continue to be secured by a perfected
first priority security interest (subject only to Permitted Liens
entitled to priority under applicable law) in the Collateral specified
in the Security Documents, whether now owned or hereafter acquired,
pursuant to the terms of the Security Documents to which the Borrowers
are a party.
7. REPRESENTATIONS AND WARRANTIES.
In order to induce the Lenders to enter into this Loan
Agreement and to make the Loans as provided for herein, each Borrower
makes, on a joint and several basis, the following representations,
warranties and agreements with the Administrative Agent and Lenders, in
each case after giving effect to the Transaction, all of which shall
survive the execution and delivery of this Loan Agreement and the
making of the Loans (with the occurrence of the Closing Date and each
Funding Date on or after the Closing Date being deemed to constitute a
representation and warranty that the matters specified in this Section
7 are true and correct in all material respects on and as of the
Closing Date and on and as of such Funding Date unless stated to relate
to a specific earlier date in which case such representations and
warranties shall be true and correct in all material respects as of
such earlier date):
7.1. COMPANY STATUS. Each Borrower and each of their
respective Subsidiaries (i) is a duly organized and validly existing
Company in good standing (or its equivalent) under the laws of the
jurisdiction of its organization except where the failure to be so duly
organized, validly existing and in good standing, either individually
or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect, (ii) has the Company power and authority to
own its property and assets and to transact the business in which it is
presently engaged, except where the failure to have such power and
authority, either individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect and (iii) is
duly qualified and is authorized to do business and is in good standing
(or its equivalent) in all jurisdictions where it is required to be so
qualified (or its equivalent) and where the failure to be so qualified,
either individually or in the aggregate, would reasonably be expected
to have a Material Adverse Effect.
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7.2. COMPANY POWER AND AUTHORITY. Each Borrower has the
Company power and authority to execute, deliver and carry out the terms
and provisions of the Loan Documents to which it is a party and has
taken all necessary Company action to authorize the execution, delivery
and performance of the Loan Documents to which it is a party. Each
Borrower has duly executed and delivered each Loan Document to which it
is a party and each such Loan Document constitutes the legal, valid and
binding obligation of such Borrower enforceable in accordance with its
terms, except to the extent that the enforceability thereof may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws generally affecting creditors' rights and by
equitable principles (regardless of whether enforcement is sought in
equity or at law).
7.3. NO VIOLATION. Neither the execution, delivery or
performance by any Borrower of the Loan Documents to which it is a
party, nor compliance by such Borrower with the terms and provisions
thereof, nor the consummation of the transactions contemplated herein
or therein, (i) will contravene any material provision of any
applicable law, statute, rule or regulation, or any order, writ,
injunction or decree of any court or governmental instrumentality, (ii)
will conflict or be inconsistent with or result in any breach of, any
of the terms, covenants, conditions or provisions of, or constitute a
default under, or (other than pursuant to the Security Documents)
result in the creation or imposition of (or the obligation to create or
impose) any Lien upon any of the property or assets of such Borrower or
any of its Subsidiaries pursuant to the terms of any indenture,
mortgage, deed of trust, loan agreement, credit agreement or any other
agreement, contract or instrument to which such Borrower or any of its
Subsidiaries is a party or by which it or any of its material property
or assets are bound or to which it may be subject, or (iii) will
violate any provision of the certificate of incorporation, by-laws,
certificate of partnership, partnership agreement, certificate of
limited liability company, limited liability company agreement or
equivalent organizational document, as the case may be, of such
Borrower or any of its Subsidiaries.
7.4. LITIGATION. There are no actions, suits, proceedings or
investigations pending or, to the knowledge of the Borrower, threatened
in writing (i) with respect to any Loan Document or (ii) with respect
to any other matter, as to which there is a reasonable possibility of
an adverse determination and that, if adversely determined, either
individually or in the aggregate, would reasonably be expected to have
a Material Adverse Effect.
7.5. USE OF PROCEEDS; MARGIN REGULATIONS. (a) The proceeds of
the Closing Date Advance shall not be used for any purpose other than
as set forth on Schedule 7.5. The proceeds of all Post-Closing Advances
shall be used solely for (i) the acquisition of additional Eligible
Containers, (ii) payment of the UBS Lease Termination Payments, (iii)
in the event that the Purchase Price (as defined in the Stock Purchase
Agreement) is subject to a post closing increase pursuant to
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either Section 2.05 or 2.06 of the Stock Purchase Agreement, to pay the
amount of such increase, and (iv) for general corporate purposes,
including the making of any Permitted Disbursement.
(b) No part of any Loan (or the proceeds thereof) will be used
to purchase or carry any Margin Stock or to extend credit for the
purpose of purchasing or carrying any Margin Stock. Neither the making
of any Loan nor the use of the proceeds thereof nor the occurrence of
any other Loan will violate or be inconsistent with the provisions of
Regulation T, Regulation U or Regulation X.
7.6. GOVERNMENTAL APPROVALS. Except as may have been obtained
or made on or prior to the Closing Date (and which remain in full force
and effect on the Closing Date), no order, consent, approval, license,
authorization or validation of, or filing, recording or registration
with, or exemption by, any domestic or foreign governmental or public
body or authority, or any subdivision thereof, is required to authorize
or is required in connection with (i) the execution, delivery and
performance of any Loan Document or (ii) the legality, validity,
binding effect or enforceability of any Loan Document, in each case,
except for (A) the filing of any Security Documents and (B) such the
failure of which to make or obtain, individually or in the aggregate,
would not reasonably be expected to result in a Material Adverse
Effect.
7.7. INVESTMENT COMPANY ACT. None of the Borrower nor any of
their respective Subsidiaries is an "investment company" or a company
"controlled" by an "investment company," within the meaning of the
Investment Company Act of 1940, as amended.
7.8. PUBLIC UTILITY HOLDING COMPANY ACT. None of the Borrower
nor any of their respective Subsidiaries is 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,"
within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
7.9. TRUE AND COMPLETE DISCLOSURE. All factual information
(taken as a whole) furnished by or on behalf of the Borrowers or any of
their respective Subsidiaries in writing to the Administrative Agent or
any Lender (including, without limitation, all information contained in
the Loan Documents) for purposes of or in connection with this Loan
Agreement and the Transaction is, and all other such factual
information (taken as a whole) hereafter furnished by, or on behalf of,
the Borrowers or any of their respective Subsidiaries in writing to the
Administrative Agent or any Lender in connection with this Loan
Agreement will be, true and accurate in all material respects on the
date as of which such information is dated or certified and not
incomplete by omitting to state any material fact necessary to make
such information (taken as a whole) not misleading in any material
respect at such time in light of the circumstances under
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which such information was provided; provided, however, that to the
extent that any such information was based upon or constitutes a
forecast or projection, each Borrower represents only that it acted in
good faith and utilized assumptions believed by the management of such
Borrower to be reasonable at the time made in the preparation of such
information (it being understood by the Administrative Agent and the
Lenders that any financial information as it relates to future events
is not to be viewed as fact and that actual results during the period
or periods covered thereby may differ from the projected results set
forth therein).
7.10. FINANCIAL CONDITION; FINANCIAL STATEMENTS. (a) On and as
of the Closing Date, on a pro forma basis after giving effect to the
Acquisition and to all Indebtedness (including the Loans) incurred, and
to be incurred, and Liens created, and to be created, by each Borrower
in connection therewith, with respect the Borrowers and their
respective Subsidiaries (on a consolidated basis) (x) the sum of the
assets, at a fair valuation, of the Borrowers and their respective
Subsidiaries (on a consolidated basis) will exceed its or their debts,
(y) they have not incurred nor intended to, nor believe that they will,
incur debts beyond their ability to pay such debts as such debts mature
and (z) they will not have unreasonably small capital with which to
conduct their business in the manner such business is now conducted.
For purposes of this Section 7.10(a), "debt" means any liability on a
claim, and "claim" means (i) right to payment, whether or not such a
right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable,
secured or unsecured or (ii) right to an equitable remedy for breach of
performance if such breach gives rise to a payment, whether or not such
right to an equitable remedy is reduced to judgment, fixed, contingent,
matured, unmatured, disputed, undisputed, secured or unsecured. The
amount of contingent liabilities at any time shall be computed as the
amount that, in the light of all facts and circumstances existing at
such time, represents the amount that can reasonably be expected to
become an actual or matured liability.
(b) (i) The consolidated balance sheets of the Borrowers and
their Consolidated Subsidiaries for its fiscal year ended December 31,
2003 and its fiscal quarter ended September 30, 2004 and the related
consolidated statements of income and cash flows and changes in
shareholders' equity of the Borrower for the fiscal year and fiscal
quarter ended on such dates, in each case furnished to the
Administrative Agent and Lenders prior to the Closing Date, present
fairly in all material respects the consolidated financial position of
the Borrower and its Subsidiaries at the date of said balance sheets
and the consolidated results of their operations for the respective
periods covered thereby. All of the foregoing financial statements have
been prepared in accordance with GAAP consistently applied (except, in
the case of the aforementioned quarterly financial statements, for
normal year-end audit adjustments and the absence of footnotes).
(ii) The pro forma consolidated balance sheet of the
Borrowers as of September 30, 2004 (after giving effect to the
Transaction and the
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financing therefor), a copy of which has been furnished to the
Administrative Agent and the Lenders prior to the Closing
Date, present fairly in all material respects the pro forma
consolidated financial position of the Borrowers and their
Subsidiaries as of September 30, 2004 (it being understood
that estimates, by their nature, are inherently uncertain and
that no assurances are being made that such results will be
achieved.
(c) Since September 30, 2004, there has been no change in the
business, financial condition or operations of the Borrowers taken as a
whole (other than the Acquisition, the incurrence of Indebtedness under
the Loan Documents and the Seller Loan and the consummation of the
transactions contemplated thereby) that would reasonably be expected to
have, either individually or in the aggregate, a Material Adverse
Effect.
7.11. SECURITY INTERESTS. On and after the Closing Date, each
of the Security Documents creates as security for the Obligations
covered thereby, a valid and enforceable security interest in and Lien
on all of the Collateral subject thereto, without prejudice to any
statutory priority rights, superior to and prior to the rights of all
third Persons, and subject to no other Liens except Permitted Liens.
The Borrowers have filed or caused to be filed all UCC financing
statements in the appropriate offices therefor (or has authenticated
and delivered to the Administrative Agent UCC financing statements
suitable for filing in such offices) and has taken all of the actions
necessary to create perfected security interests in the Collateral
which the Security Documents require the Borrowers to create perfected
security interests.
7.12. COMPLIANCE WITH ERISA. Each of the Borrowers and each of
their respective ERISA Affiliates is in compliance in all material
respects with the applicable provisions of ERISA and the regulations
and published interpretations thereunder. No ERISA Event has occurred
or is reasonably expected to occur that, when taken together with all
other such ERISA Events, could reasonably be expected to result in any
liability of any Borrower or any of their respective ERISA Affiliates
in excess of $20,000,000. The present value of all benefit liabilities
under each Plan (based on the assumptions used for purposes of
Statement of Financial Accounting Standards No. 87) did not, as of the
last annual valuation date applicable thereto, exceed by more than
$15,000,000 the fair market value of the assets of such Plan, and the
present value of all benefit liabilities of all underfunded Plans
(based on the assumptions used for purposes of Statement of Financial
Accounting Standards No. 87) did not, as of the last annual valuation
date applicable thereto, exceed by more than $20,000,000 the fair
market value of the assets of all such underfunded Plans.
7.13. SUBSIDIARIES. On and as of the Closing Date, the
Borrowers have no Subsidiaries other than those Subsidiaries listed on
Schedule 7.13. Schedule 7.13 sets forth, as of the Closing Date, (i)
the percentage ownership (direct and indirect) of each Borrower in each
class of Capital Stock of each of its
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Subsidiaries and also identifies the direct owner thereof and (ii) the
jurisdiction of organization of each such Subsidiary. All outstanding
shares of Capital Stock of each Subsidiary of each Borrower have been
duly and validly issued, are fully paid and non-assessable (to the
extent applicable in the jurisdiction of organization of such
Subsidiary). No Subsidiary of any Borrower has outstanding any
securities convertible into or exchangeable for its Capital Stock or
outstanding any right to subscribe for or to purchase, or any options
or warrants for the purchase of, or any agreement providing for the
issuance (contingent or otherwise) of or any calls, commitments or
claims of any character relating to, its Capital Stock or any stock
appreciation or similar rights. Except for the existing investments
described on Schedule 7.13, as of the Closing Date, none of the
Borrowers nor any of their Subsidiaries owns or holds, directly or
indirectly, any Capital Stock of any Person other than its Subsidiaries
indicated on Schedule 7.13.
7.14. COMPLIANCE WITH STATUTES; AGREEMENTS, ETC. Each Borrower
and each of their respective Subsidiaries is in compliance with (i) all
applicable statutes, regulations, rules and orders of, and all
applicable restrictions imposed by, all governmental bodies, domestic
or foreign, in respect of the conduct of its business (including the
origination of Leases) and the ownership of its property (excluding
applicable statutes, regulations, orders and restrictions relating to
environmental standards and controls, which matters are covered under
Section 7.15) and (ii) all contracts and agreements to which it is a
party, except, in each case, such non-compliances as would not
reasonably be expected to have, either individually or in the
aggregate, a Material Adverse Effect.
7.15. ENVIRONMENTAL MATTERS. Except as would not reasonably be
expected to result in, either individually or in the aggregate, a
Material Adverse Effect: (i) each of the Borrower and their respective
Subsidiaries has complied with all applicable Environmental Laws and
the requirements of any permits issued under such Environmental Laws
and none of the Borrowers nor any of their respective Subsidiaries is
liable for any penalties, fines or forfeitures for failure to comply
with any of the foregoing; (ii) there are no pending Environmental
Claims or, to the knowledge of any Senior Designated Officer of the
Borrower, Environmental Claims threatened in writing against any
Borrower or any of their Subsidiaries or any property (real or
personal) owned, leased or operated by any Borrower or any of their
Subsidiaries (including, to the knowledge of any Senior Designated
Officer of any Borrower, any such claim arising out of the ownership,
lease or operation by any Borrower or any of its Subsidiaries of any
property (real or personal) formerly owned, leased or operated by any
Borrower or any of their Subsidiaries but no longer owned, leased or
operated by such Borrower or any of its Subsidiaries); and (iii) to the
knowledge of any Senior Designated Officer of the Borrower, there are
no facts, circumstances, conditions or occurrences on or arising from
any property (real or personal) owned, leased or operated by any
Borrower or any of their Subsidiaries (including any property (real or
personal) formerly owned, leased or operated by
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any Borrower or any of their Subsidiaries but no longer owned, leased
or operated by such Borrower or any of its Subsidiaries) or relating to
the past or present operations of any Borrower or any of its
Subsidiaries that could reasonably be expected to form the basis of an
Environmental Claim against such Borrower or any of its Subsidiaries or
any such property (real or personal).
7.16. LABOR RELATIONS. As of the Closing Date, there are no
strikes, lockouts or slowdowns against any Borrower or any of their
respective Subsidiaries pending, or to the knowledge of the Borrowers,
threatened. The hours worked by and payments made to employees of the
Borrowers and their respective Subsidiaries have not been in violation
of the Fair Labor Standards Act or and other applicable federal, state
or local law dealing with such matters, except for such violations that
would not reasonably be expected, individually or in the aggregate, to
result in a Material Adverse Effect.
7.17. TAX RETURNS AND PAYMENTS. Each of the Borrowers and each
of their respective Subsidiaries has timely filed (including applicable
extensions) with the appropriate taxing authority, all federal and
other material returns, statements, forms and reports for taxes (the
"Returns") required to be filed by or with respect to the income,
properties or operations of the Borrower and each of its Subsidiaries.
The Returns accurately reflect in all material respects all liability
for taxes of the Borrowers and each of their Subsidiaries as a whole
for the periods covered thereby. The Borrowers and each of their
Subsidiaries have paid all material taxes payable by them other than
those contested in good faith and for which adequate reserves have been
established in accordance with GAAP.
7.18. SCHEDULED EXISTING INDEBTEDNESS. Schedule 7.18 sets
forth all material Indebtedness of the Borrowers and their Subsidiaries
as of the Closing Date and which is to remain outstanding immediately
after giving effect to the Transaction and the incurrence of Loans on
such date (exclusive of Indebtedness pursuant to this Loan Agreement
and the other Loan Documents), in each case showing the aggregate
principal amount thereof (and the aggregate amount of any undrawn
commitments with respect thereto) and the name of the respective
borrower and any other entity which directly or indirectly guarantees
such debt.
7.19. INSURANCE. Schedule 7.19 sets forth a summary of all
insurance maintained by the Borrowers and their Subsidiaries on and as
of the Closing Date and after giving effect to the Transaction, with
the amounts insured (and any deductibles) set forth therein.
7.20. FOREIGN ASSETS CONTROL REGULATIONS, ETC. None of the
requesting or borrowing of any Loan or the use of the proceeds of such
will violate the Trading With the Enemy Act (50 U.S.C. ss. 1 et seq.,
as amended) (the "Trading With the Enemy Act") or any of the foreign
assets control regulations of the United States Treasury Department (31
CFR, Subtitle B, Chapter V, as amended) (the "Foreign Assets Control
Regulations") or any enabling legislation or
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executive order relating thereto (which for the avoidance of doubt
shall include, but shall not be limited to (a) Executive Order 13224 of
September 21, 2001 Blocking Property and Prohibiting Transactions With
Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed.
Reg. 49079 (2001)) (the "Executive Order") and (b) the Uniting and
Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001 (Public Law 107-56)).
Furthermore, none of the Borrowers or their Affiliates (a) is or will
become a "blocked person" as described in the Executive Order, the
Trading With the Enemy Act or the Foreign Assets Control Regulations or
(b) engages or will engage in any dealings or transactions, or be
otherwise associated, with any such "blocked person".
7.21. LOCKBOX ACCOUNTS AND PAYMENT INSTRUCTIONS. The names and
addresses of all Lockboxes and Lockbox Accounts in effect on the
Closing Date are set forth on Schedule 7.21 hereof. As of the Closing
Date, the Borrowers have instructed all Lessees to submit all payments
on the Leases directly to one of the Lockbox Accounts. As of the
Closing Date, the Borrowers have not granted any interest in any
Lockbox Account to any Person other than the Administrative Agent.
7.22. CREDIT AND COLLECTION POLICY. The credit and collection
policy used by the Borrowers as in effect on the Closing Date (which
policy also addressed the criteria under which a lessee is allowed to
self-insure for property and liability risks) is attached as Exhibit G
hereto (the "Credit and Collection Policy").
7.23. FORM OF LEASE AGREEMENT. The standard form(s) of Lease
Agreement used by the Borrowers in the ordinary course of their
business as in effect on the Closing Date is attached as Exhibit H
hereto.
7.24. UBS LEASE AGREEMENT. A true, complete and correct copy
of the UBS Lease Agreement as in effect on the Closing Date is attached
as Exhibit I hereto.
7.25. DEPRECIATION POLICY. The Depreciation Policy used in the
calculation of the Asset Base as in effect on the Closing Date is
attached as Exhibit J hereto.
8. AFFIRMATIVE COVENANTS.
Each Borrower hereby covenants and agrees that as of the
Closing Date and thereafter for so long as this Loan Agreement is in
effect and until the Loan Commitment has been terminated, and the Loans
and Notes, together with interest, Fees and all other Obligations
incurred hereunder, are paid in full:
8.1. INFORMATION COVENANTS. Each Borrower will furnish, or
will cause to be furnished, to the Administrative Agent for
distribution to each Lender:
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(a) Quarterly Financial Statements. Within 45 days after the
close of the first three fiscal quarters in each fiscal year of
Container Holdings (commencing with the fiscal quarter ending March 31,
2005), the consolidated balance sheet of Container Holdings and its
Subsidiaries as at the end of such fiscal quarter, the related
consolidated statements of income for such fiscal quarter and for the
elapsed portion of the fiscal year ended with the last day of such
fiscal quarter and the related consolidated statements of shareholder's
equity and cash flows for the elapsed portion of the fiscal year ended
with the last day of such fiscal quarter and (in each case, with
respect to each fiscal quarter commencing after the completion of the
fourth full fiscal quarter following the Closing Date), all of which
shall be certified by the chief financial officer or other Authorized
Officer of Container Holdings that they fairly present in all material
respects in accordance with GAAP the consolidated financial condition
of Container Holdings and its Subsidiaries as of the dates indicated
and the consolidated results of their operations and/or changes in
their cash flows for the periods indicated, subject to normal year-end
audit adjustments and the absence of footnotes.
(b) Annual Financial Statements. Within 120 days after the
close of each fiscal year of Container Holdings, the consolidated
balance sheet of the Container Holdings and its Subsidiaries as at the
end of such fiscal year and the related consolidated statements of
income and shareholder's equity and statement of cash flows for such
fiscal year and, with respect to each fiscal year commencing after the
completion of the first full fiscal year following the Closing Date,
setting forth comparative consolidated figures for the preceding fiscal
year (or, if shorter since inception), together with a certification by
an Independent Accountant reasonably acceptable to the Administrative
Agent, in each case to the effect that such statements fairly present
in all material respects the consolidated financial condition of
Container Holdings and its Subsidiaries as of the dates indicated and
the results of their consolidated operations and changes in financial
position for the periods indicated in conformity with GAAP applied on a
basis consistent with prior years except as disclosed therein (which
report shall be without a "going concern" or like qualification or
exception and without any qualification or exception as to the scope of
such audit); provided, however that any such "going concern"
qualification that is specifically related to the status or terms of
the loans evidenced by this Loan Agreement shall not cause a breach
under the provisions of this section (b).
(c) Budgets, etc. On or prior to March 31 of each fiscal year
commencing after the Closing Date, a budget in form reasonably
satisfactory to the Administrative Agent (including (i) budgeted
statements of income, sources and uses of cash and balance sheets and
(ii) budgeted statements of Directing Operating Expenses, selling,
general and administrative expenses, lease payments owing by the
Borrowers and third party management fees payable to the Borrowers)
prepared by Container Holdings on a consolidated basis for Container
Holdings and their Subsidiaries for such fiscal year prepared in detail
and setting
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forth, with appropriate discussion, the principal assumptions upon
which such financial projections are based.
(d) Business Plan. On or prior to March 31 of each fiscal year
commencing after the Closing Date, a consolidated business plan for the
Borrowers (or updates to the existing business plans of such entities)
for such fiscal year. At the time of the delivery of the financial
statements provided for in Section 8.1(b), the Borrowers will deliver
to the Administrative Agent a comparison of such actual financial
results to the budgeted results for such year. Such comparison shall be
in the form which the Borrowers use in their ordinary course of
business.
(e) Officer's Certificates. At the time of the delivery of the
financial statements provided for in Sections 8.1(a) and (b), a
certificate of the chief financial officer or other Authorized Officer
of the Borrower to the effect that no Default or Event of Default
exists or, if any Default or Event of Default does exist, specifying
the nature and extent thereof, and which certificate shall, if
delivered with respect to any fiscal quarter or fiscal year terminating
on or after the first anniversary of the Closing Date, set forth in
reasonable detail the calculations required to establish whether the
Borrower and its Subsidiaries were in compliance with the provisions of
Section 10.1 hereof as at the end of such fiscal quarter or fiscal
year, as the case may be.
(f) Notice of Default or Litigation. Promptly, and in any
event within five Business Days after any Senior Designated Officer of
any Borrower or any of its Subsidiaries thereof obtains knowledge
thereof, notice of (i) the occurrence of any event which constitutes a
Default or an Event of Default, which notice shall specify the nature
and period of existence thereof and what action the Borrower or such
Subsidiary proposes to take with respect thereto, (ii) any litigation
or proceeding pending or, to the knowledge of Senior Designated Officer
of any Borrower, threatened in writing against any Borrower or any of
their Subsidiaries which, either individually or in the aggregate,
would reasonably be expected to have, a Material Adverse Effect or
(iii) any governmental investigation pending or, to the knowledge of
Senior Designated Officer of any Borrower, threatened in writing
against any Borrower or any of their Subsidiaries which, either
individually or in the aggregate, would reasonably be expected to have
a Material Adverse Effect.
(g) Management Letters. At the request of the Administrative
Agent, a copy of any "management letter" submitted to the Borrowers or
any of their Subsidiaries by its independent accountants in connection
with any annual, interim or special audit made by them of the financial
statements of the Borrower or any of its Subsidiaries and management's
responses thereto.
(h) Container Performance Reports. On each Determination Date
with respect to the reports set forth in clauses (i) and (ii), or
within 45 days after the
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end of each Collection Period with respect to all other reports, each
of the following: (i) Manager Reports, substantially in the form of
Exhibit D hereto, (ii) Asset Base Reports, substantially in the form of
Exhibit A hereto, (iii) utilization reports and receivable aging, (iv)
quarterly comparison and analysis of actual versus budgeted levels of
Direct Operating Expenses, Selling, General and Administrative
expenses, lease out payments and third party management fees, (v) fleet
performance reports, including utilization, lease rates, disposal
rates, purchase amounts and prices and (vi) an Equipment Report,
substantially in the form of Exhibit C hereto, setting forth the number
and type of containers then owned by the Borrowers, their aggregate Net
Book Value and their aggregate Original Equipment Cost.
(i) Reports. Within 5 Business Days following transmission
thereof, copies of any public filings and registrations with, and
reports to, the SEC by any Borrower or any of their Subsidiaries.
(j) Independent Certified Public Accountant's Report. The
Borrowers shall cause an Independent Accountant who may also render
other services to the Borrowers to deliver to the Administrative Agent
on or before June 30, 2005 (and each subsequent anniversary thereof),
with respect to the twelve months ended on the preceding December 31
(or such other period as shall have elapsed from the Closing Date to
the date of such statement), an agreed upon procedures report with
respect to the procedures set forth in Exhibit S hereto.
(k) Copies of Purchase Documentation, Invoices, Bills of Sale
and Other Title Documents. Upon the reasonable request of the
Administrative Agent, the Borrowers shall provide to the Administrative
Agent (A) copies of purchase documentation, invoices, bills of sale
and/or releases with respect to the Containers purchased with the
proceeds of the Loans, and (B) such other documentation as the
Administrative Agent may reasonably request to establish the Net Book
Value of each such Container.
(l) Other Information. From time to time, such other
information or documents (financial or otherwise) in the form utilized
by the Borrowers in their own operations with respect to the Borrowers,
any of their Subsidiaries or the Administrative Agent as the
Administrative Agent or any Lender may reasonably request and which is
reasonably available to the Borrowers.
8.2. BOOKS, RECORDS AND INSPECTIONS. Each Borrower will, and
will cause each of its Subsidiaries to, keep proper books of record and
accounts in which full, true and correct entries which permit the
preparation of financial statements in accordance with GAAP and which
conform in all material respects to all requirements of law, shall be
made of all dealings and transactions in relation to its business and
activities. Each Borrower will, and will cause each of its Subsidiaries
to, permit officers and designated representatives of the
Administrative Agent to visit and inspect, under guidance of officers
of such
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Borrower or Subsidiary, any of the properties of the Borrowers or their
Subsidiaries, and to examine the books of account of the Borrowers or
their Subsidiaries and discuss the affairs, finances and accounts of
the Borrowers or their Subsidiaries with, and be advised as to the same
by, its and their officers and independent accountants, all upon
reasonable prior notice and at such reasonable times and intervals
(during regular working hours) and to such reasonable extent as the
Administrative Agent may reasonably request; provided, however, that
unless an Event of Default shall have occurred and then be continuing,
the Administrative Agent may request only one inspection under this
Section 8.2 during any twelve month period.
8.3. PERMITTED SECURITIZATION. In addition to any transfer
requested by the Administrative Agent pursuant to Section 8.17 hereof,
the Borrowers will, subject to market conditions, use commercially
reasonable efforts to effect a Permitted Securitization in order to
repay in full all of the Loans and other Obligations evidenced by this
Loan Agreement by not later than the end of the eighteenth month
following the Closing Date; provided, however, that the sole remedy for
a breach of this Section 8.3 shall be the increase in the Applicable
Margin set forth in this Loan Agreement.
8.4. PAYMENT OF TAXES. Each Borrower will pay and discharge,
and will cause each of its Subsidiaries to pay and discharge, all
taxes, assessments and governmental charges or levies imposed upon it
or upon its income or profits, or upon any properties belonging to it,
in each case on a timely basis, and all lawful claims which, if unpaid,
could reasonably be expected to become a lien or charge upon any
properties of such Borrower or any of its Subsidiaries not otherwise
permitted under Section 9.3; provided that none of the Borrowers nor
any of their Subsidiaries shall be required to pay any such tax,
assessment, charge, levy or claim which is immaterial or is being
contested in good faith and by proper proceedings if it has maintained
adequate reserves with respect thereto in accordance with GAAP.
8.5. EXISTENCE; FRANCHISES. Except as otherwise permitted by
Section 9.2, each Borrower will do, and will cause each of its
Subsidiaries to do, or cause to be done, all things necessary to
preserve and keep in full force and effect its Company existence and
its rights, franchises, authorities to do business, licenses,
certifications, accreditations and patents; provided, however, that
nothing in this Section 8.5 shall (x) prevent the withdrawal by a
Borrower or any of its Subsidiaries of its qualification as a foreign
Company in any jurisdiction where such withdrawal would not, either
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect or (y) require the preservation of any such
right, franchise, authorities to do business, license, certification,
accreditation or patent to the extent that the lapse thereof, either
individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect.
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8.6. COMPLIANCE WITH STATUTES; ETC. Each Borrower will, and
will cause each of its Subsidiaries to, comply with all applicable
statutes, regulations and orders of, and all applicable restrictions
imposed by, all governmental bodies, domestic or foreign, in respect of
the conduct of its business and the ownership of its property, except
for such noncompliances as, either individually or in the aggregate,
would not reasonably be expected to have a Material Adverse Effect.
8.7. END OF FISCAL YEARS; FISCAL QUARTERS. Each Borrower will
cause (i) each of its fiscal years to end on December 31 of each
calendar year and (ii) each of its fiscal quarters to end on March 31,
June 30, September 30 and December 31 of each year.
8.8. FURTHER ASSURANCES. Each Borrower will, and will cause
each of its Subsidiaries to, at its own expense, make, execute,
endorse, acknowledge, file and/or deliver to the Administrative Agent
from time to time such vouchers, invoices, schedules, confirmatory
assignments, confirmatory conveyances, financing statements, transfer
endorsements, confirmatory powers of attorney, certificates, reports
and other assurances or confirmatory instruments and take such further
steps relating to the Collateral covered by any of the Security
Documents as the Administrative Agent may reasonably require pursuant
to this Section 8.8.
8.9. USE OF PROCEEDS. The Borrowers will, and will cause each
of its Subsidiaries to, use the proceeds of the Loans for the purposes
specified in Section 7.5.
8.10. PERFORMANCE OF OBLIGATIONS. The Borrowers will, and will
cause each of their Subsidiaries to, perform all of its obligations
under the terms of each mortgage, deed of trust, indenture, loan
agreement or credit agreement and each other agreement, contract or
instrument by which it is bound (other than any such obligations under,
or mortgages, deeds of trust, indentures, loan agreements, credit
agreements or other material agreements, contracts or instruments
entered into in connection with, a Permitted Securitization), except
such non-performances as, either individually or in the aggregate,
would not reasonably be expected to cause a Material Adverse Effect.
8.11. MAINTENANCE OF CONTAINERS. The Borrowers will:
(a) keep, or cause to be kept, its Containers in good repair
and working order in a manner consistent with past practices, and make,
or cause to be made, all needful and proper repairs, replacements,
additions and improvements thereto as are necessary for the conduct of
its business, and in order to maintain the Containers in accordance
with manufacturer's instructions and in as good an operating condition
as when originally delivered, reasonable wear and tear and causes
beyond the Borrowers' control excepted;
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(b) at all times use the Containers, and require the related
Lessee to use the Containers, in accordance with good operating
practices and shall at all times comply with all loading limitations,
handling procedures and operating instructions prescribed by the
manufacturer which include but are not limited to the latest applicable
regulations and recommendations of the International Organization of
Standardization as well as any applicable local regulations;
(c) not knowingly use (or knowingly permit the Lessees to use)
the Containers for storage of transportation of contraband in violation
of applicable United States law;
(d) comply with the International Convention for Safe
Containers (CSC) in all respects including, without limitation,
plating, maintenance, examination, re-examination and marking with
re-examination dates of such Container, such examination, or
re-examination, shall be performed in accordance with the rules and
regulations for the Safety Approval of Cargo Containers of the United
States Department of Transportation.
8.12. INSURANCE. The Borrowers will, in a manner consistent
with the practices of the Borrowers as of the Closing Date, (i) effect
and maintain, with financially sound and reputable companies reasonably
satisfactory to the Administrative Agent (which the Administrative
Agent acknowledges to be true on the Closing Date) a general liability
insurance, insuring the Borrowers, the Administrative Agent and each
Lender against liability for personal injury and property damage
liability, caused by, or relating to, the Containers then off-lease,
with such levels of coverage and deductibles that are consistent with
the levels in effect as of the Closing Date, and (ii) have a standard
form of lease agreement that requires each Lessee to maintain (1)
physical damage insurance in an amount equal to the value of the
Containers on lease to it and to name TLI as a loss payee, and (2)
comprehensive general liability insurance, including contractual
liability, against claims for bodily injury or death and property
damage and to name TLI as an additional insured. The Administrative
Agent and the Lenders reserve the right (but shall not have the
obligation) to obtain (i) at Borrowers' expense, insurance with respect
to any or all of the foregoing risks if the Borrowers shall fail to
obtain such coverage in the specified amounts, and (ii) at the Lender's
expense, additional insurance on its own behalf with respect to any or
all of the foregoing risks (or any other risk). However, the
Administrative Agent and the Lenders will notify the Borrowers prior to
obtaining and such insurance. All insurance maintained by the Borrowers
for loss or damage of the Containers shall provide that losses, if any,
shall be payable to the Administrative Agent or its designee as sole
loss payee and the Borrower shall utilize its reasonable efforts to
have all checks relating to any such losses delivered promptly to
Administrative Agent or such other person designated by the
Administrative Agent. The Administrative Agent and each Lender shall be
named as an additional insured with respect to all such liability
insurance maintained by, or on behalf of, the Borrowers. The Borrowers
shall pay the premiums with respect to all such insurance and deliver
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to Administrative Agent evidence reasonably satisfactory to
Administrative Agent of such insurance coverage. The Borrowers shall
cause to be provided to Administrative Agent, not less than fifteen
(15) days prior to the scheduled expiration or lapse of such insurance
coverage, evidence reasonably satisfactory to Administrative Agent of
renewal or replacement coverage. The Borrowers shall use their
commercially reasonable efforts to have each insurer agree, by
endorsement upon the policy or policies issued by it or by independent
instrument furnished to Administrative Agent, that (i) it will give
each additional insured and the loss payee thirty (30) days' prior
written notice of the effective date of any material alteration,
cancellation or non-renewal of such policy and (ii) in the event that
the cancellation of such coverage would result in a breach of this
Section 8.12 by the Borrowers, it will permit the Administrative Agent
and/or the Lender(s) to make payments to effect the continuation of
coverage upon notice of cancellation due to nonpayment of premium.
8.13. INTEREST RATE HEDGING AGREEMENTS. (a) Within ninety (90)
days after the Closing Date and within thirty (30) days after each
calendar quarter thereafter, the Borrowers will enter into, and
maintain for so long as any Obligations remain unpaid, one or more
Hedging Agreements with respect to that portion of the Aggregate Note
Principal Balance attributable to (i) those Eligible Containers that
are then subject to a Lease that has a then remaining term of more than
three years and (ii) without duplication of the Leases referred to in
clause (i), those Eligible Containers that are then subject to a
Finance Lease, all of which Hedging Agreements shall have an aggregate
notional principal amount required by the formula set forth in Exhibit
K hereto and have a projected amortization schedule as set forth in
such Exhibit.
8.14. UNIDROIT CONVENTION. The Borrowers will comply with the
terms and provisions of the UNIDROIT Convention on International
Interests in Mobile Goods or any other internationally recognized
system for recording interests in or liens against shipping containers
at the time that such convention is adopted.
8.15. IDENTIFICATION OF GROSS LEASE REVENUES AND DIRECT
OPERATING EXPENSE; TRANSFER OF GROSS LEASE REVENUES. The Borrowers will
establish and maintain such procedures as are necessary for determining
and for identifying Gross Lease Revenues and Direct Operating Expenses
to a specific Container.
8.16. COMPLIANCE WITH CREDIT AND COLLECTION POLICY. The
Borrowers will comply in all material respects with the Credit and
Collection Policy in regard to the origination of, and amendments and
modifications to, Leases.
8.17. PAYMENT INSTRUCTION TO LESSEES. The standard form of
Lease utilized by the Borrowers will instruct all Lessees to submit
directly to the Lockbox Accounts all payments owing to the Borrowers
with respect to the Leases.
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8.18. TRANSFER TO SPECIAL PURPOSE VEHICLES. The Borrowers
will, at the reasonable request of the Administrative Agent, use
commercially reasonable efforts to transfer all of the Container and
Leases encumbered by the Loan Documents to one or more special purpose
vehicles in a transaction that otherwise qualifies as a Permitted
Securitization and would not have a material and adverse tax effect on
the Borrowers and their Subsidiaries; provided that, after giving
effect to such transfer, the terms and conditions of the Loan Documents
will be not materially more disadvantageous to the Borrowers.
8.19. STATIC STORAGE CONTAINERS. The Borrowers will cause all
of the static storage containers owned by ICS Terminals (UK) Limited
and included in the calculation of the Asset Base to be free from Liens
(other than Permitted Liens) in favor of any Person (other than the
Administrative Agent).
9. NEGATIVE COVENANTS.
Each Borrower hereby covenants and agrees that as of the
Closing Date and thereafter for so long as this Loan Agreement is in
effect and until the Commitment has been terminated, and the Loans and
Revolving Credit Notes, together with interest, Fees and all other
Obligations incurred hereunder, are paid in full:
9.1. CHANGES IN BUSINESS; ETC. The Borrowers will not, and
will not permit any of their Subsidiaries to, engage in any business
other than a Permitted Business.
9.2. CONSOLIDATION; MERGER; SALE OR PURCHASE OF ASSETS; ETC.
Each Borrower will not, and will not permit any of its Subsidiaries to,
wind up, liquidate or dissolve its affairs or enter into any
transaction of merger or consolidation, or convey, sell, lease or
otherwise dispose of all or any part of its property or assets, or
enter into any sale-leaseback transactions, or purchase or otherwise
acquire (in one or a series of related transactions) all or
substantially all of the property or assets of any Person (or any
division or line of business of another Person) or agree to do any of
the foregoing at any future time, except that the following shall be
permitted:
(i) the Borrowers and their Subsidiaries may lease (as
lessor) or license (as licensee) real or personal property,
all in the ordinary course of business;
(ii) the acquisition of additional Eligible Containers by
the Borrowers or any Subsidiary that has (a) become a borrower
hereunder and (b) pledged to the Administrative Agent, on
behalf of the Lenders, a Lien on its assets; provided,
however, that any Special Purpose Vehicle formed in connection
with a Permitted Securitization shall not be required to
comply with the provisions of this clause (ii);
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(iii) Investments permitted pursuant to Section 9.5;
(iv) the Borrowers and their Subsidiaries may sell assets,
so long as (A) the proceeds of each such sale is payable in
(i) cash on the closing of such sale or (ii) receivables that
are payable within 90 days after the date of issuance, or
(iii) some combination of clauses (i) and (ii); (B) each such
sale incurs in the ordinary course of business of such
Borrower or Subsidiary as the case may be; (C) no single sale
(or series of related sales) shall involve Containers
representing in aggregate more than ten thousand (10,000)
TEU's unless the Sales Proceeds to be received from such sale
exceeds an amount equal to eighty-one and one half percent
(81.5%) of the then Net Book Values of the Containers subject
to such sale; (D) the composition of the Containers included
in any single sale will not materially and adversely alter the
profile of the remaining containers owned by the Borrowers,
after giving effect to such sale, in terms of lessee, on-hire
status and type, and (E) the Sales Proceeds from any such
sales are promptly deposited into the Lockbox Accounts or
Concentration Account;
(v) the Borrowers and their Subsidiaries may sell or
discount, in each case without recourse, accounts receivable
arising in the ordinary course of business, so long as such
sale or discount does not result in an Asset Base Deficiency;
(vi) the Borrowers and their Subsidiaries may grant leases
or subleases (including Leases) to other Persons in the
ordinary course of business;
(vii) (x) any Borrower may be merged, consolidated,
dissolved or liquidated with or into another Borrower, and (y)
any Subsidiary of the Borrower may be merged, consolidated,
dissolved or liquidated with or into a Borrower (so long as
the Borrower is the surviving corporation of such merger,
consolidation, dissolution or liquidation); provided that any
such merger, consolidation, dissolution or liquidation
involving a Borrower pursuant to this clause (y) shall be
permitted so long as (I) no Default or Event of Default then
exists or would exist immediately after giving effect thereto,
and (II) any security interests granted to the Administrative
Agent in the assets (and Capital Stock) of any such Person
subject to any such transaction shall remain in full force and
effect and perfected and enforceable (to at least the same
extent as in effect immediately prior to such merger,
consolidation, dissolution or liquidation);
(viii) each of the Borrowers and their respective
Subsidiaries may sell or liquidate Cash Equivalents;
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(ix) the Borrowers and their respective Subsidiaries may
sell Containers to their respective Lessees in the ordinary
course of business pursuant to (A) a Finance Lease (so long as
such Finance Lease complies with all applicable Concentration
Limits and Container Representations and Warranties) and (B)
purchase option contained in any Lease with such Lessee that
was originated in the ordinary course of business;
(x) the Borrowers and their Subsidiaries may (i) sell all
of its Containers and Related Assets to a Special Purpose
Vehicle in connection with a Permitted Securitization and (ii)
transfer its assets to a Special Purpose Entity in accordance
with the provisions of Section 8.19 of this Loan Agreement;
and
(xi) the Borrowers and their Subsidiaries may dispose of
used, obsolete, uneconomic, worn-out or surplus assets (other
than Containers) in the ordinary course of its business.
To the extent the Required Lenders waive the provisions of this Section
9.2 with respect to the sale or other disposition of any Collateral, or
any Collateral is sold or otherwise disposed of as permitted by this
Section 9.2, such Collateral (unless transferred to another Credit
Party) shall be sold or otherwise disposed of free and clear of the
Liens created by the Security Documents and the Administrative Agent
shall take such actions (including, without limitation, directing the
Administrative Agent to take such actions) as are appropriate in
connection therewith.
9.3. LIENS. The Borrowers will not, and will not permit any of
their Subsidiaries to, create, incur, assume or suffer to exist any
Lien upon or with respect to any Collateral; provided that the
provisions of this Section 9.3 shall not prevent the creation,
incurrence, assumption or existence of the following (Liens described
below are herein referred to as "Permitted Liens"):
(i) Liens for taxes, assessments or governmental charges
or levies not yet delinquent or Liens for taxes, assessments
or governmental charges or levies being contested in good
faith and by appropriate proceedings for which adequate cash
reserves have been established in accordance with GAAP;
(ii) Liens in respect of property or assets of the
Borrowers or any of its Subsidiaries imposed by law which have
not arisen to secure Indebtedness for borrowed money, such as
carriers', seamen's, stevedores', wharfinger's,
warehousemens', mechanics', landlord's, suppliers',
repairmen's or other like Liens, and relating to amounts not
yet due or which shall not have been overdue for a period of
more than thirty (30) days or which are being contested in
good faith by appropriate
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proceedings for which adequate cash reserves have been
established in accordance with GAAP;
(iii) Liens created by or pursuant to this Loan Agreement
and the Security Documents;
(iv) Liens arising from judgments, decrees or attachments
in respect of which the Borrower or any of its Subsidiaries
shall in good faith be prosecuting an appeal or proceedings
for review and in respect of which there shall have been
secured a subsisting stay of execution pending such appeal or
proceedings (including in connection with the deposit of cash
or other property in connection with the issuance of stay and
appeal bonds);
(v) Liens (other than any Lien imposed by ERISA) (x)
incurred or deposits made in the ordinary course of business
of the Borrowers and their Subsidiaries in connection with
workers' compensation, unemployment insurance, social security
benefits and other similar forms of governmental insurance
benefits, (y) to secure the performance by the Borrowers and
their Subsidiaries of tenders, statutory obligations, surety
and customs bonds, statutory bonds, bids, leases, government
contracts, trade contracts, performance bonds and other
similar obligations incurred in the ordinary course of
business (exclusive of (I) obligations for the payment of
Indebtedness and (II) stay and appeal bonds and other
obligations in respect of litigation, arbitration or similar
claims or otherwise of the types described in Section 9.3(iv)
above) or (z) to secure the performance by the Borrowers and
their Subsidiaries of leases of Real Property, to the extent
incurred or made in the ordinary course of business consistent
with past practices;
(vi) licenses, sublicenses, leases or subleases (including
Leases) granted to third Persons in the ordinary course of
business;
(vii) Liens arising from or related to precautionary UCC
or like personal property security financing statements
regarding operating leases (if any) entered into by the
Borrowers and their Subsidiaries in the ordinary course of
business;
(viii) Liens arising pursuant to purchase money mortgages
or security interests securing Indebtedness representing the
purchase price (or financing of the purchase price within 120
days after the respective purchase) of Containers acquired
after the Closing Date by the Borrowers and subject to
compliance with Section 9.2(ii) hereof, their Subsidiaries,
provided that (x) any such Liens attach only to the assets so
purchased and (y) the Indebtedness secured by any such Lien
does not exceed 100% of
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the purchase price of the property being purchased at the time
of the incurrence of such Indebtedness;
(ix) Liens in favor of customs or revenue authorities
arising as a matter of law to secure payment of customs duties
in connection with the importation of goods;
(x) Liens of any lessee under any Finance Lease;
(xi) Liens securing Hedging Agreements that either (A) are
required to be incurred pursuant to the terms of the Loan
Documents or (B) relate to Indebtedness that is permitted to
be incurred under the terms of the Loan Documents;
(xii) Liens existing on the Closing Date and set forth on
Schedule 9.3;
(xiii) Liens arising solely by virtue of any statutory or
common law provision relating to bankers' liens, rights of set
off or similar rights and remedies as to deposit accounts or
other funds maintained with a creditor depository institution;
and
(xiv) Liens incurred in connection with a Permitted
Securitization;
9.4. INDEBTEDNESS. The Borrowers will not, and will not permit
any of their Subsidiaries to, contract, create, incur, assume or suffer
to exist any Indebtedness, except:
(i) Indebtedness incurred pursuant to this Loan Agreement
and the other Loan Documents;
(ii) Indebtedness of the Borrowers or any of their
Subsidiaries under Hedging Agreements entered into to protect
them against fluctuations in interest rates in respect of
Indebtedness otherwise permitted under this Loan Agreement, so
long as the entering into of such Hedging Agreements are bona
fide hedging activities and are not for speculative purposes;
(iii) Indebtedness of the Borrowers or any of their
Subsidiaries which may be deemed to exist in connection with
agreements providing for indemnification, purchase price
adjustments and similar obligations in connection with the
acquisition or disposition of any business, Subsidiary or
assets prior to the Closing Date or in accordance with the
requirements of this Loan Agreement, or from letters of
credit, surety bonds or performance bonds securing any
obligation of the Borrowers or any such Subsidiary, pursuant
to such agreement;
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(iv) Intercompany Indebtedness of a Borrower or a
Subsidiary for so long as such Indebtedness is held by a
Borrower or a Wholly-Owned Subsidiary of a Borrower; provided,
that (I) unless the respective obligor under such intercompany
loan reasonably determines that the execution, delivery and
performance of an Intercompany Note is prohibited by, or that
such Intercompany Note would not be enforceable against such
obligor under, applicable local law, any such intercompany
loan made pursuant to this clause (iv) shall be evidenced by
an Intercompany Note or by such other documentation as may be
acceptable to the Administrative Agent, (II) the proceeds of
any such Intercompany Indebtedness funded by any Borrower to
any Wholly-Owned Subsidiary shall be used by such Wholly-Owned
Subsidiary solely to pay Permitted Disbursements, and (III)
each intercompany loan made pursuant to this clause (iv) shall
be subject to an Intercompany Subordination Agreement;
(v) Indebtedness of a Borrower or of a Subsidiary
represented by letters of credit for the account of such
Borrower or such Subsidiary, as the case may be, (i) in order
to provide security for workers' compensation claims, payment
obligations in connection with self-insurance or similar
requirements in the ordinary course of business, (ii) in order
to provide security for any trade, contractual or payment
obligations of such Borrower or Subsidiary, or (iii) issued or
incurred for such other purposes as are related to the
ordinary course of business of such Borrower or such
Subsidiary; provided, however, that the aggregate amount of
outstanding Indebtedness permitted pursuant to the provisions
of this clause (v) shall not exceed $25 Million Dollars;
(vi) Purchase money indebtedness or obligations in
connection with the acquisition of Containers by a Borrower
or, subject to compliance with Section 9.2(ii) hereof, its
Subsidiaries after the Closing Date; provided that (A) such
indebtedness or obligations represents the purchase price (or
financing of the purchase price within 120 days after the
respective purchase) of such Container and (B) such
indebtedness or obligations do not exceed 100% of the purchase
price of the property being purchased at the time of the
incurrence of such indebtedness or obligations;
(vii) Indebtedness of a Borrower or of a Subsidiary set
forth on Schedule 7.18 hereto or otherwise outstanding as of
the Closing Date;
(viii) Refinancing Indebtedness;
(ix) obligations in respect of performance, bid, surety
and appeal bonds and completion guarantees or obligations of a
similar nature provided by a Borrower or any Subsidiary in the
ordinary course of business;
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(x) Indebtedness arising from the honoring by a bank or
other financial institution of a check, draft or similar
instrument inadvertently (except in the case of daylight
overdrafts) drawn against insufficient funds in the ordinary
course of business, so long as such Indebtedness is
extinguished within five Business Days of the incurrence
thereof;
(xi) Indebtedness incurred in connection with a Permitted
Securitization;
(xii) Endorsements for collection, deposit or negotiation
and warranties of products and services, in each case,
incurred in the ordinary course of business; and
(xiii) Unsecured Indebtedness of any of the Borrowers
issued in lieu of making a cash Dividend permitted pursuant to
Section 9.6; provided, however, that no unsecured Indebtedness
of the type described in this clause (xiii) shall be issued
with respect to the IO Distributable Amount.
9.5. ADVANCES; INVESTMENTS; LOANS. The Borrowers will not, and
will not permit any of their Subsidiaries to, directly or indirectly,
lend money or extend credit or make advances to any Person, or purchase
or acquire any stock, obligations or securities of, or any other
Capital Stock of, or make any capital contribution to, any Person (each
of the foregoing an "Investment" and, collectively, "Investments"),
except:
(i) the Borrowers and their Subsidiaries may acquire and
hold cash and Cash Equivalents;
(ii) the Borrowers and their Subsidiaries may acquire and
hold receivables owing to it, if created or acquired in the
ordinary course of its business and payable or dischargeable
in accordance with customary trade terms of such Borrower or
such Subsidiary;
(iii) the Borrowers and their Subsidiaries may acquire and
own investments (including debt obligations) received in
connection with the bankruptcy or reorganization of Lessees,
suppliers, trade creditors, licensees, licensors and customers
and in good faith settlement of delinquent obligations of, and
other disputes with, Lessees, suppliers, trade creditors,
licensees, licensors and customers arising in the ordinary
course of business;
(iv) Hedging Agreements entered into in the ordinary
course of business or otherwise in compliance with Section
9.4(ii) shall be permitted;
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(v) Both of (x) loans by the Borrowers and their
Subsidiaries to officers, employees and directors of the
Borrowers and their Subsidiaries for bona fide business
purposes, in each case incurred in the ordinary course of
business shall be permitted, and (y) advances of reimbursable
expenses, including advances for travel and moving expenses,
by the Borrowers and their Subsidiaries to officers, employees
and directors of the Borrowers and their Subsidiaries for bona
fide purposes, in each case incurred in the ordinary course of
business shall be permitted;
(vi) Investments in any Borrower or any Subsidiary of any
Borrower shall be permitted; provided, that in order for any
Intercompany Indebtedness to be permitted pursuant to this
clause (vi), such Intercompany Indebtedness must additionally
be permitted to be incurred under Section 9.4(iv);
(vii) Investments as lessor under arm's-length capital
leases (determined in accordance with GAAP) of maritime
containers entered into in the ordinary course of business
with unaffiliated third parties shall be permitted;
(viii) Investments in any Person to the extent such
Investments consist of prepaid expenses, negotiable
instruments held for collection and lease, utility and
workers' compensation, performance and other similar deposits
made in the ordinary course of business shall be permitted;
(ix) Investments by one or more Borrowers in one or more
Subsidiaries, or by a Subsidiary in any other Subsidiary, may
be incurred in connection with a Permitted Securitization
shall be permitted;
(x) the Borrowers and their Subsidiaries may own the
Capital Stock of, their respective Subsidiaries created or
acquired in accordance with the terms of this Loan Agreement;
(xi) the Borrowers and their Subsidiaries may acquire and
hold Investments issued by the purchaser of assets in
connection with a sale of such assets to the extent permitted
by Section 9.2;
(xii) Investments in existence as of the Closing Date as
set forth on Schedule 9.5 hereto and any extension,
modification or renewal of and such Investments existing on
the Closing Date, shall be permitted;
(xiii) the Borrowers may acquire and hold obligations of
one or more officers, directors or other employees of such
Borrowers or any of its Subsidiaries in connection with such
officers', directors' or employees' acquisition of shares of
capital stock of the Borrowers, so long as no cash is paid by
the Borrowers or any of its Subsidiaries to such officers,
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directors or employees in connection with the acquisition of
any such obligations; and
(xiv) Investments in Eligible Investments made in
accordance with Section 3.4 shall be permitted.
9.6. DIVIDENDS. The Borrowers will not, and will not permit
any of their Subsidiaries to, declare or pay any Dividends other than a
Permitted Dividend.
9.7. TRANSACTIONS WITH AFFILIATES. The Borrowers will not, and
will not permit any of their Subsidiaries to, enter into any
transaction or series of transactions with any Affiliate of the
Borrowers or any of their Subsidiaries other than in the ordinary
course of business and on terms and conditions substantially as
favorable to such Borrower or such Subsidiary as would be reasonably
expected to be obtainable by such Borrower or such Subsidiary at the
time in a comparable arm's-length transaction with a Person other than
an Affiliate; provided that the following shall in any event be
permitted: (i) the payment of consulting or other fees to the Borrowers
by any of their Subsidiaries in the ordinary course of business; (ii)
reasonable fees and compensation paid to, and indemnity provided on
behalf of, officers, directors, employees or consultants of any
Borrower or any of their respective Subsidiaries; (iii) transactions
exclusively between or among the Borrowers, exclusively between or
among a Borrower and any Subsidiary of any Borrower, exclusively
between Subsidiaries of any of the Borrowers, or exclusively between
any of the Borrowers or any of their respective Subsidiaries and any of
their respective joint ventures; (iv) any agreement as in effect as of
the Closing Date as set forth on Schedule 9.7 hereto or any transaction
contemplated thereby and any amendment thereto or any replacement
agreement thereto, so long as any such amendment or replacement
agreement is not more disadvantageous to any Borrower or any of their
respective Subsidiaries in any material respect than the original
agreement as in effect on the Closing Date; (v) any reasonable
employment, stock option, stock repurchase, employee benefit
compensation, business expense reimbursement, severance, termination,
or other employment-related agreements, arrangements or plans entered
into in good faith by any Borrower or any of their respective
Subsidiaries in the ordinary course of business; (vi) any issuance of
Capital Stock of any of the Borrowers; (vii) any transaction
consummated in connection with or to facilitate a Permitted
Securitization, (viii) the Borrowers and their Subsidiaries may enter
into employment and severance arrangements with respect to the
procurement of services with their respective officers and employees in
the ordinary course of business; and (ix) transactions to the extent
permitted by Section 9.6.
9.8. LIMITATION ON CERTAIN RESTRICTIONS ON SUBSIDIARIES. The
Borrowers will not, and will not permit any of their Subsidiaries
(other than a Special Purchase Vehicle) to, directly or indirectly,
create or otherwise cause or suffer to exist or become effective, any
encumbrance or restriction on the ability
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of any such Subsidiary to (x) pay dividends or make any other
distributions on its capital stock or any other Capital Stock or
participation in its profits owned by a Borrower or any of its
Subsidiaries, or pay any Indebtedness owed to a Borrower or any of its
Subsidiaries, (y) make loans or advances to a Borrower or any of its
Subsidiaries or (z) transfer any of its properties or assets to the
Borrowers or any of their Subsidiaries, except for such encumbrances or
restrictions existing under or by reason of (i) applicable law, rule,
regulation or order, (ii) this Loan Agreement and the other Loan
Documents, (iii) customary provisions restricting subletting or
assignment of any lease governing a leasehold interest of a Borrower or
a Subsidiary of a Borrower, (iv) customary provisions restricting
assignment of any licensing agreement (in which the Borrower or any of
its Subsidiaries is the licensee) or any other contract entered into by
a Borrower or any of its Subsidiaries in the ordinary course of
business, (v) any encumbrance or restriction pursuant to an agreement
in effect or entered into on the Closing Date as set forth on Schedule
9.8 hereto (and all replacements or substitutions thereof on terms not
materially more adverse to the Lenders and not materially less
favorable or materially more onerous to the Borrowers and their
respective Subsidiaries than those contained the any such agreement on
the Closing Date), (vi) customary agreements relating to the transfer
of, or the granting of licenses in licenses related to, copyrights,
patents or other intellectual property, (vii) provisions in joint
venture agreements and other similar agreements (in each case relating
solely to the respective joint venture or similar entity or the equity
interests therein), (viii) purchase money indebtedness permitted to be
incurred under this Loan Agreement, (ix) restrictions on cash or other
deposits under bona fide arrangements with customers entered into in
the ordinary course of business, (x) Refinancing Indebtedness
(provided, that the restrictions contained in the agreements governing
such Refinancing Indebtedness are not materially more restrictive, take
as a whole, than those contained in the agreements governing the
Indebtedness being refinanced); (xi) agreements or instruments that
prohibit the payment of dividends or the making of other distributions
with respect to Capital Stock other than on a pro rata basis, (xii)
with respect to any Subsidiary, any encumbrance or restriction
contained in the terms of any Indebtedness, or any agreement pursuant
to which such Indebtedness was issued, if (1) the encumbrance or
restriction applies only in the event of a payment default or a default
with respect to a financial covenant contained in such Indebtedness or
agreement, (2) the encumbrance or restriction is not materially more
disadvantageous to the Lenders than is customary in comparable
financings, and (3) such encumbrance or restriction will not materially
affect the Borrowers' ability to make principal or interest payments on
the Loans, (xiii) restrictions on the transfer of any asset pending the
close of the sale of such asset and (xiv) any restriction or
encumbrance or the transfer of any assets subject to Liens permitted by
Section 9.3 hereof.
9.9. CHANGE IN CREDIT AND COLLECTION POLICY. The Borrowers
will not change the terms and provisions of the Credit and Collection
Policy in any
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material respect without the prior written consent of the
Administrative Agent in each instance, such consent not to be
unreasonably withheld or delayed.
9.10. CHANGE IN PAYMENT INSTRUCTIONS TO LESSEES. The Borrowers
will not (i) add or terminate any Trust Account, Concentration Account,
Lockbox Account, Accounts Payable Account or IO Disbursement Account
except in accordance with the provisions of Section 3.5 hereof, or (ii)
make any change in its instructions to Lessees, regarding payments to
be made by Lessees, other than changes in the instructions that Lessees
make payments to another Lockbox Account that in each case is subject
to an account agreement.
9.11. COST ALLOCATION METHODOLOGIES. The Borrowers will not
change, in any material respect, without the prior written consent of
the Administrative Agent in each instance, its methodologies in effect
on the Closing Date for (i) classifying an expense as a Direct
Operating Expense or corporate overhead, (ii) classifying an item of
revenue as a Gross Lease Revenues, or (iii) allocating Gross Lease
Revenues or Direct Operating Expenses to a specific Container.
9.12. AMENDMENTS TO DEPRECIATION POLICY. The Borrower will not
change its Depreciation Policy used in calculating the Asset Base
without the prior written consent of the Administrative Agent in each
instance.
9.13. LIMITATION ON THE CREATION OF SUBSIDIARIES. The
Borrowers will not, and will not permit any of their Subsidiaries to,
establish, create or acquire after the Closing Date any Subsidiary,
provided that, notwithstanding the foregoing, the Borrowers and any of
their respective Wholly-Owned Subsidiaries shall be permitted to
establish, create and, to the extent permitted hereunder, acquire
Wholly-Owned Subsidiaries so long as (A) written notice thereof is
given to the Administrative Agent on or prior to the 10th Business Day
following such establishment, creation or acquisition written notice
thereof and (B) the Capital Stock of each such new Wholly-Owned
Subsidiary that is a direct Wholly-Owned Subsidiary of a Borrower is
pledged pursuant to, and to the extent required by, the Pledge
Agreement and, if such Capital Stock constitutes certificated Capital
Stock, the certificates representing such Capital Stock, together with
stock or other powers duly executed in blank, are delivered to the
Administrative Agent.
10. FINANCIAL COVENANTS.
The Borrowers covenant and agree that, at all times subsequent
to the first anniversary of the Closing Date and for so long as any
Loan or Revolving Credit Note is outstanding or any Lender has any
obligation to make any Loans:
10.1. CONSOLIDATED EBIT TO CONSOLIDATED CASH INTEREST EXPENSE
RATIO. The Borrowers will not permit the Consolidated EBIT to
Consolidated Cash Interest Expense Ratio to be less than 1.00 to 1.00,
such calculation to be made at the end of each fiscal quarter of the
Borrowers commencing with the fiscal quarter ending December 31, 2005.
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11. CLOSING CONDITIONS.
The obligation of each Lender to make a Loan hereunder on the
Closing Date, is subject, at the time of the making of such Loans to
the satisfaction of the following conditions (or the written waiver of
such conditions by the Administrative Agent):
11.1. EXECUTION OF AGREEMENT; NOTES. On or prior to the
Closing Date, (i) this Loan Agreement and the other Loan Documents
shall have been executed and delivered and (ii) there shall have been
delivered to the Administrative Agent for the account of each Lender
which has requested the same the appropriate Note, in each case
executed by the Borrowers and in the amount, maturity and as otherwise
provided herein.
11.2. OFFICER'S CERTIFICATE. On the Closing Date, the
Administrative Agent shall have received a certificate from the
Borrowers, dated the Closing Date and signed by an Authorized Officer
of the Borrowers, certifying that all of the applicable conditions set
forth in Section 12.2 (other than such conditions to the extent that
such conditions are expressly subject to the satisfaction of the
Administrative Agent and/or the Required Lenders), have been satisfied
on such date.
11.3. OPINIONS OF COUNSEL. On the Closing Date, the
Administrative Agent shall have received from Xxxxx Xxxxx Xxxx & Maw
LLP, counsel to the Borrower, an opinion addressed to the
Administrative Agent and each of the Lenders and dated the Closing Date
substantially in the form of Exhibit L, which opinion shall (x) be
addressed to the Administrative Agent and each of the Lenders and be
dated the Closing Date, (y) cover the creation and perfection of the
security interests and/or liens granted pursuant to the relevant
Security Documents and such other matters incident to the transactions
contemplated herein as the Administrative Agent may reasonably request
and (z) be in form and substance reasonably satisfactory to the
Administrative Agent.
11.4. COMPANY DOCUMENTS; PROCEEDINGS.
(a) On the Closing Date, the Administrative Agent shall have
received from each Borrower a certificate, dated the Closing Date,
signed by the chairman, a vice-chairman, the president, any
vice-president or any other Authorized person of such Borrower, and
attested to by the secretary, any assistant secretary or other senior
officer of such Borrower, in the form of Exhibit M with appropriate
insertions, together with copies of the certificate of incorporation,
by-laws or equivalent organizational documents of such Borrower and the
resolutions of such Borrower referred to in such certificate, and all
of the foregoing shall be reasonably satisfactory to the Administrative
Agent.
(b) On the Closing Date, all instruments and agreements in
connection with the transactions contemplated by this Loan Agreement
and the other
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Documents shall be reasonably satisfactory in form and substance to the
Administrative Agent, and the Administrative Agent shall have received
all information and copies of all certificates, documents and papers,
including good standing certificates, bring-down certificates and any
other records of Company proceedings and governmental approvals, if
any, which the Administrative Agent reasonably may have requested in
connection therewith, such documents and papers, where appropriate, to
be certified by proper Company or governmental authorities.
11.5. APPROVALS. On or prior to the Closing Date, (i) all
necessary governmental (domestic and foreign), regulatory and material
third party approvals and/or consents in connection with the
Transaction and the Stock Purchase Agreement and otherwise referred to
herein or therein shall have been obtained and remain in full force and
effect and evidence thereof shall have been provided to the
Administrative Agent; except for any such approval or consent the
failure to obtain would not reasonably be expected to have a Material
Adverse Effect, and (ii) all applicable waiting periods shall have
expired without any action being taken by any competent authority which
restrains, prevents or imposes materially adverse conditions upon the
consummation of the Transaction, the making of the Loans and the
transactions contemplated by the Loan Documents or otherwise referred
to herein or therein. Additionally, on the Closing Date, there shall
not exist any judgment, order, injunction or other restraint issued or
filed or a hearing seeking injunctive relief or other restraint pending
or notified prohibiting or imposing materially adverse conditions upon,
or materially delaying, or making economically unfeasible, the
consummation of the Transaction or the making of the Loans or the other
transactions contemplated by the Documents or otherwise referred to
herein or therein.
11.6. CONSUMMATION OF THE TRANSACTION. On or prior to the
Closing Date, the transaction described in the Stock Purchase Agreement
shall have been consummated and the Administrative Agent and the
Lenders shall have received evidence to its satisfaction that all of
the conditions precedent set forth thereon shall have been satisfied or
waived.
11.7. INTERCREDITOR AGREEMENT WITH HOLDER OF SELLER LOAN. The
holder of the Seller Loan will enter into a written agreement with the
Administrative Agent to the effect that (i) it will not institute, and
will not join with others in instituting a bankruptcy against any of
the Borrowers until at least one year and one day (or the longest
performance period under federal or state insolvency laws then in
effect) after all indebtedness under the Loan Documents have been
repaid in full; (ii) distributions to the holder of the Seller Loan are
to be made only at the times and only in such amounts as funds are
available to the Borrowers in accordance with the terms of the priority
of payments contained in the Loan Documents; (iii) it shall take no
action that would cause any of the Borrowers to breach any of its
respective covenants in its organizational documents or the Loan
Documents; (iv) it shall not amend, or agree to the
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amendment of, the organizational documents of any of the Borrowers
without the prior written consent of the Administrative Agent in each
instance; and (v) it shall take no action, or join with others to take
any action (x) challenging the validity or enforceability of any of the
security interests set forth in the Loan Documents or (y) seeking the
consolidation of any of the Borrowers with any other Person.
11.8. SECURITY AGREEMENT. On the Closing Date, each of the
Borrowers shall have duly authorized, executed and delivered the
security agreement in the form of Exhibit N hereto (as amended,
modified, restated and/or supplemented from time to time, the "Security
Agreement") covering all of such Borrower's present and future
collateral referred to therein, together with:
(i) proper financing statements (Form UCC-1 or the
equivalent) authenticated for filing under the UCC or other
appropriate filing offices of each jurisdiction as may be
necessary or, in the reasonable opinion of the Administrative
Agent desirable, to perfect the security interests purported
to be created by the Security Agreement;
(ii) certified copies of Requests for Information or
Copies (Form UCC-11), or equivalent reports, each of a recent
date, listing all effective financing statements that name a
Borrower as debtor and that are filed in the jurisdictions
referred to in clause (i) above, together with copies of such
other financing statements that name a Borrower as debtor
(none of which shall cover any of the Collateral, except to
the extent evidencing Permitted Liens or in respect of which
the Administrative Agent shall have received termination
statements (Form UCC-3) or such other termination statements
as shall be required by local law fully executed (where
required) for filing);
(iii) evidence of the completion of (or adequate provision
for) all other recordings and filings of, or with respect to,
the Security Agreement as may be necessary or, in the
reasonable opinion of the Administrative Agent desirable, to
perfect the security interests intended to be created by the
Security Agreement; and
(iv) evidence that all other actions necessary or, in the
reasonable opinion of the Administrative Agent desirable, to
create, maintain, effect, perfect, preserve, maintain and
protect the security interests purported to be created by the
Security Agreement have been taken;
and the Security Agreement shall be in full force and effect.
11.9. TAX ALLOCATION AGREEMENTS. On or prior to the Closing
Date, there shall have been delivered to the Administrative Agent by
the Borrowers true and correct copies of all tax sharing and other tax
allocation agreements entered into by a Borrower or any of its
Subsidiaries, all agreements shall be in form and
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substance reasonably satisfactory to the Administrative Agent and shall
be in full force and effect on the Closing Date.
11.10. SOLVENCY CERTIFICATE; INSURANCE CERTIFICATES; ETC.. On
the Closing Date, the Administrative Agent shall have received:
(i) a solvency certificate in the form of Exhibit O from
the chief financial officer of the Borrowers, dated the
Closing Date, and supporting the conclusion that, after giving
effect to the Transaction and the incurrence of all financings
contemplated herein, the Borrowers and their Subsidiaries (on
a consolidated basis) are not insolvent and will not be
rendered insolvent by the indebtedness incurred in connection
herewith, will not be left with unreasonably small capital
with which to engage in its or their respective businesses and
will not have incurred debts beyond its or their ability to
pay such debts as they mature and become due; and
(ii) evidence of insurance complying with the requirements
of Section 8.12 for the business and properties of the
Borrowers, in scope, form and substance reasonably
satisfactory to the Administrative Agent and naming the
Administrative Agent as an additional insured and/or loss
payee, and stating that such insurance shall not be canceled
or materially revised without at least 30 days' prior written
notice by the respective insurer to the Administrative Agent.
11.11. FINANCIAL STATEMENTS; PRO FORMA FINANCIAL STATEMENTS.
On or prior to the Closing Date, there shall have been delivered to the
Administrative Agent and the Lenders true and correct copies of the
historical and pro forma financial statements referred to in Section
7.10(b).
11.12. PAYMENT OF FEES. On the Closing Date, all costs, fees
and expenses, and all other compensation due to the Administrative
Agent and the Lenders (including, without limitation, reasonable and
documented legal fees and expenses) shall have been paid to the extent
then due.
11.13. BUDGETS. On or prior to the Closing Date, there shall
have been delivered to the Administrative Agent and the Lenders,
separate detailed budgets of selling, general and administrative
expenses and capital expenditures for the Borrowers for the fiscal
years ended December 31, 2004 and December 31, 2005, each of which
shall be reasonably satisfactory to the Administrative Agent.
11.14. SELLER LOAN. On or prior to the Closing Date, there
shall have been delivered to the Administrative Agent and the Lender
all of the executed documentation evidencing the Seller Loan, all of
which shall be reasonably satisfactory to the Administrative Agent.
11.15. PLEDGE AGREEMENT. On the Closing Date, each Borrower
shall have duly authorized, executed and delivered the pledge agreement
in the form of
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Exhibit P (as amended, modified, restated and/or supplemented from time
to time, the "Pledge Agreement") and shall have delivered to the
Administrative Agent, as pledgee thereunder, all of the Pledge
Agreement Collateral, if any, referred to therein and then owned by
such Borrower, (x) endorsed in blank in the case of promissory notes
constituting Pledge Agreement Collateral and (y) together with executed
and undated transfer powers in the case of certificated Capital Stock
constituting Pledge Agreement Collateral, and the Pledge Agreement
shall be in full force and effect.
11.16. PARTICIPATION AGREEMENT. On the Closing Date, the
Borrowers shall have duly authorized, executed and delivered the
Participation Agreement, and the Participation Agreement shall be in
full force and effect.
11.17. INTERCOMPANY SUBORDINATION AGREEMENT. On the Closing
Date, the Borrowers and any Subsidiary of a Borrower which is an
obligee with respect to any intercompany debt owed by a Borrower shall
have duly authorized, executed and delivered an intercompany
subordination agreement in the form of Exhibit Q (as amended, modified,
restated and/or supplemented from time to time, the "Intercompany
Subordination Agreement"), and the Intercompany Subordination Agreement
shall be in full force and effect.
11.18. CONTROL AGREEMENT. On the Closing Date, the Borrowers
shall have delivered to the Administrative Agent, a fully executed
control agreement, in form and substance satisfactory to the
Administrative Agent, with respect to each of the Lockbox Account, the
Concentration Account, the Accounts Payable Account and the Payroll
Account.
12. CONDITIONS PRECEDENT TO ALL LOANS.
The obligation of each Lender to make Loans (including Loans
made on the Closing Date) is subject, at the time of each such Loan
(except as hereinafter indicated), to the satisfaction of the following
conditions:
12.1. CLOSING DATE. The Closing Date shall have occurred and
the Revolving Credit Period shall not have expired or been terminated.
12.2. NO DEFAULT; REPRESENTATIONS AND WARRANTIES. At the time
of each such Loan and immediately after giving effect thereto (i) there
shall exist no Designated Event of Default and (ii) all representations
and warranties contained herein and in each other Loan Document shall
be true and correct in all material respects with the same effect as
though such representations and warranties had been made on the date of
such Loan (it being understood and agreed that any representation or
warranty which by its terms is made as of a specified date shall be
required to be true and correct in all material respects only as of
such specified date).
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12.3. LOAN REQUEST. Prior to the making of each Loan, the
Administrative Agent shall have received a Loan Request meeting the
requirements of Section 2.3 and showing in reasonable detail that the
Aggregate Note Principal Balance (calculated after giving effect to the
requesting Loan) shall not exceed the Asset Base (calculated as of the
last day of the most recent month for which internal financial
statements are available and after giving effect to the addition of the
Eligible Containers to be acquired with the proceeds of the Loan).
13. EVENTS OF DEFAULT; ACCELERATION; ETC.
13.1. EVENTS OF DEFAULT AND ACCELERATION. If any of the
following events ("Events of Default" or, if the giving of notice or
the lapse of time or both is required, then, prior to such notice or
lapse of time, "Defaults") shall occur:
(a) the Borrowers shall fail to pay (i) on any Payment Date
any principal payment to the extent that funds are available for such
purpose in accordance with the priority of payment set forth in Section
3.1, or (ii) on the earlier to occur of (x) the date on which the
principal balance of the Revolving Credit Notes have been accelerated
in accordance with Section 13.1 hereof, and (y) the Legal Final Payment
Date, the then Aggregate Note Principal Balance;
(b) the Borrowers shall fail to pay on any Payment Date any
interest payment, Commitment Fees or Agent Fee then due and payable on
the Revolving Credit Notes and the continuation of such default for
more than five (5) Business Days after such amounts shall have become
due and payable;
(c) on any Payment Date, the Aggregate Note Principal Balance
(after giving effect to any payments of principal made on such Payment
Date) exceeds an amount equal to the product of (i) one hundred five
percent (105%) and (ii) the Asset Base then in effect;
(d) default in the payment of any amounts due and owing to the
Lenders of any Revolving Credit Notes other than the amounts described
in clauses (a) and (b) above, and the continuation of such default for
more than fifteen (15) Business Days after the date on which a Senior
Designated Officer of the Borrowers received written notice of
non-payment;
(e) any Borrower shall fail to comply with any of its
covenants contained in Sections 9.1, 9.2, 9.3, 9.4, 9.5, 9.6, 9.7, 9.8,
9.10 or 9.12 or Section 10;
(f) any Borrower shall fail to perform any term, covenant or
agreement contained herein or in any of the other Loan Documents (which
is not otherwise addressed in this Section 13) which failure materially
and adversely affects the interests of the Administrative Agent or the
Lenders and continues for
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thirty days after written notice of such failure has been given to a
Senior Designated Officer of the Borrower;
(g) any representation or warranty of any Borrower made in any
Loan Document shall prove incorrect in any material respect when made
which materially and adversely affects the interest of the
Administrative Agent or any Lender and which (if curable) remains
unremedied for a period of 30 days after the first date on which a
Senior Designated Officer of such Borrower has received written notice
thereof;
(h) a Borrower or any of its Subsidiaries (other than a
Special Purpose Vehicle) shall commence a voluntary case concerning
itself under the Federal Bankruptcy Code; or an involuntary case is
commenced against a Borrower or any of its Subsidiaries (other than a
Special Purpose Vehicle) and the petition is not controverted within 10
days, or is not dismissed within 60 days, after commencement of the
case; or a custodian (as defined in the Bankruptcy Code) is appointed
for, or takes charge of, all or substantially all of the property of a
Borrower or any of its Subsidiaries (other than a Special Purpose
Vehicle); or a Borrower or any of its Subsidiaries (other than a
Special Purpose Vehicle) commences any other proceeding under any
reorganization, arrangement, adjustment of debt, relief of debtors,
dissolution, insolvency or liquidation or similar law of any
jurisdiction whether now or hereafter in effect relating to a Borrower
or any of its Subsidiaries (other than a Special Purpose Vehicle) any
such proceeding which remains undismissed for a period of 60 days; or a
Borrower or any of its Subsidiaries (other than a Special Purpose
Vehicle) is adjudicated insolvent or bankrupt; or any order of relief
or other order approving any such case or proceeding is entered; or a
Borrower or any of its Subsidiaries (other than a Special Purpose
Vehicle) suffers any appointment of any custodian or the like for it or
any substantial part of its property to continue undischarged or
unstayed for a period of 60 days; or a Borrower or any of its
Subsidiaries (other than a Special Purpose Vehicle) makes a general
assignment for the benefit of creditors; or any Company action is taken
by a Borrower or any of its Subsidiaries (other than a Special Purpose
Vehicle) for the purpose of effecting any of the foregoing;
(i) the occurrence of either of the following:
(i) Container Holdings or any of its Subsidiaries fails to
make any payment when due (beyond the applicable grace or cure
period with respect thereto, if any) with respect to the
Seller Loan or the High Yield Bonds and either (x) the
holder(s) of such Indebtedness have accelerated such
Indebtedness or (y) such default shall not have been
permanently waived by the applicable holder(s) of such
Indebtedness within thirty (30) Business Days after the later
of such default or the expiration of any applicable grace or
cure period; or
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(ii) Container Holdings or any of its Subsidiaries
defaults in the observance or performance (beyond the
applicable grace or cure period with respect thereto, if any)
of any agreement or covenant relating to the Seller Loan or
the High Yield Bonds or contained in any instrument or
agreement evidencing, securing or relating thereto or any
other event or condition shall occur or condition exist, the
effect of which default or other event or condition is to
cause, or permit, the holder or holders of such Indebtedness
(or trustee or agent on behalf of such holders) to cause such
Indebtedness to become due prior to its stated maturity, and
either (x) the holder(s) of such Indebtedness have accelerated
such Indebtedness, or (y) such default shall not have been
permanently waived by the applicable holder(s) of such
Indebtedness within ninety (90) days after the later of such
default or the expiration of any applicable grace or cure
period ;
(j) a Change of Control, other than as the result of a public
offering of the stock of Container Holdings, TLI, TOL or TOCC or any of
their respective direct or indirect parents, occurs without the prior
consent of the Administrative Agent and the Required Lenders;
(k) the Security Agreement or the Lien purported to be created
thereby shall become or be adjudged by a court of competent
jurisdiction to be invalid or enforceable against any Borrower for any
reason other than any action taken by the Administrative Agent or any
Lender or the failure of the Administrative Agent or any Lender to take
any action within its control;
(l) one or more judgments or decrees shall be entered against
a Borrower or any of its respective Subsidiaries (other than a Special
Purpose Vehicle) involving a liability (to the extent not paid when due
or covered by a reputable and solvent insurance company (with any
portion of any judgment or decree not so covered to be included in any
determination hereunder)) equal to or in excess of $20 million for all
such judgments and decrees and all such judgments or decrees shall
either be final and non-appealable or shall not have been vacated,
discharged or stayed or bonded pending appeal for any period of 30
consecutive days; or
(m) any law, rule or regulation shall render invalid, or
preclude enforcement of, any material provision of this Loan Agreement
or any other Loan Document or impair performance of the Borrowers
obligations under this Loan Agreement or under any other Loan Document,
in each case, for any reason other than any action taken by the
Administrative Agent or any Lender or the failure of the Administrative
Agent or any Lender to take any action within its control.
then, and in any such event, so long as the same may be continuing, the
Administrative Agent may, and upon the request of the Required Lenders
shall, by notice in writing to the Borrowers declare all amounts owing
with respect to this Loan Agreement, the Revolving Credit Notes and the
other Loan Documents
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to be, and they shall thereupon forthwith become, immediately due and
payable without presentment, demand, protest or other notice of any
kind, all of which are hereby expressly waived by the Borrowers;
provided that in the event of any Event of Default specified in
Sections 13.1(h), all such amounts shall become immediately due and
payable automatically and without any requirement of notice from the
Administrative Agent.
13.2. TERMINATION OF COMMITMENTS. If an Event of Default
specified in Sections 13.1(h) shall occur, any unused portion of the
credit hereunder shall forthwith terminate and each of the Lenders
shall be relieved of all further obligations to make Loans to the
Borrower. If any other Event of Default shall have occurred and be
continuing, the Administrative Agent may and upon the request of the
Required Lenders shall, by notice to the Borrower, terminate the unused
portion of the Commitments hereunder, and upon such notice being given
such unused portion of the Commitments hereunder shall terminate
immediately and each of the Lenders shall be relieved of all further
obligations to make Loans. No termination of the Commitments hereunder
shall relieve the Borrowers of any of the Obligations.
13.3. REMEDIES. In case any one or more of the Events of
Default shall have occurred and be continuing, and whether or not the
Administrative Agent shall have accelerated the maturity of the Loans
pursuant to Section 13.1, each Lender, if owed any amount with respect
to the Loans may, with the consent of the Required Lenders but not
otherwise, proceed to protect and enforce its rights by suit in equity,
action at law or other appropriate proceeding, whether for the specific
performance of any covenant or agreement contained in this Loan
Agreement and the other Loan Documents or any instrument pursuant to
which the Obligations to such Lender are evidenced, including as
permitted by applicable law the obtaining of the ex parte appointment
of a receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any
other legal or equitable right of such Lender. No remedy herein
conferred upon any Lender or the Administrative Agent or the holder of
any Note is intended to be exclusive of any other remedy and each and
every remedy shall be cumulative and shall be in addition to every
other remedy given hereunder or now or hereafter existing at law or in
equity or by statute or any other provision of law.
13.4. DISTRIBUTION OF COLLATERAL PROCEEDS. In the event that,
following the occurrence or during the continuance of any Default or
Event of Default, the Administrative Agent or any Lender, as the case
may be, receives any monies in connection with the enforcement of any
of the Security Documents, or otherwise with respect to the realization
upon any of the Collateral, such monies shall be distributed for
application as follows:
(a) First, to the payment of, or (as the case may be) the
reimbursement of the Administrative Agent for, or in respect of, all
reasonable costs, expenses,
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disbursements and losses which shall have been incurred or sustained by
the Administrative Agent in connection with the collection of such
monies by the Administrative Agent, for the exercise, protection or
enforcement by the Administrative Agent of all or any of the rights,
remedies, powers and privileges of the Administrative Agent under this
Loan Agreement or any of the other Loan Documents or in respect of the
Collateral or in support of any provision of adequate indemnity to the
Administrative Agent against any taxes or liens which by law shall
have, or may have, priority over the rights of the Administrative Agent
to such monies;
(b) Second, in accordance with the applicable provisions of
the priority of payments set forth in clauses (i) through (ix)
inclusive of Section 3.1(b);
(c) Third, upon payment and satisfaction in full or other
provisions for payment in full satisfactory to the Lenders and the
Administrative Agent of all of the Obligations, to the payment of any
obligations required to be paid pursuant to Section 9-608(a)(1)(C) or
9-615(a)(3) of the Uniform Commercial Code of the State of New York;
and
(d) Fourth, the excess, if any, shall be returned to the
Borrowers or to such other Persons as are entitled thereto.
14. ADMINISTRATIVE AGENT.
14.1. APPOINTMENT AND AUTHORITY. Each of the Lenders hereby
irrevocably appoints Fortis to act on its behalf as the Administrative
Agent hereunder and under the other Loan Documents and authorizes the
Administrative Agent to take such actions on its behalf and to exercise
such powers as are delegated to the Administrative Agent by the terms
hereof or thereof, together with such actions and powers as are
reasonably incidental thereto. The provisions of this Section are
solely for the benefit of the Administrative Agent, and the Lenders,
and none of the Borrowers shall have rights as a third party
beneficiary of any of such provisions.
14.2. RIGHTS AS A LENDER. The Person serving as the
Administrative Agent hereunder shall have the same rights and powers in
its capacity as a Lender as any other Lender and may exercise the same
as though it were not the Administrative Agent and the term "Lender" or
"Lenders" shall, unless otherwise expressly indicated or unless the
context otherwise requires, include the Person serving as the
Administrative Agent hereunder in its individual capacity. Such Person
and its Affiliates may accept deposits from, lend money to, act as the
financial advisor or in any other advisory capacity for and generally
engage in any kind of business with the Borrowers or any of their
Affiliates as if such Person were not the Administrative Agent
hereunder and without any duty to account therefor to the Lenders.
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14.3. EXCULPATORY PROVISIONS. The Administrative Agent shall
not have any duties or obligations except those expressly set forth
herein and in the other Loan Documents. Without limiting the generality
of the foregoing, the Administrative Agent:
(a) shall not be subject to any fiduciary or other implied
duties, regardless of whether a Default or an Event of Default has
occurred and is continuing;
(b) shall not have any duty to take any discretionary action
or exercise any discretionary powers, except discretionary rights and
powers expressly contemplated hereby or by the other Loan Documents
that the Administrative Agent is required to exercise as directed in
writing by the Required Lenders (or such other number or percentage of
the Lenders as shall be expressly provided for herein or in the other
Loan Documents), provided that the Administrative Agent shall not be
required to take any action that, in its opinion or the opinion of its
counsel, may expose the Administrative Agent to liability or that is
contrary to any Loan Document or applicable law; and
(c) shall not, except as expressly set forth herein and in the
other Loan Documents, have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to the
Borrowers or any of their Affiliates that is communicated to or
obtained by the Person serving as the Administrative Agent or any of
its Affiliates in any capacity.
The Administrative Agent shall not be liable for any action
taken or not taken by it (i) with the consent or at the request of the
Required Lenders (or such other number or percentage of the Lenders as
shall be necessary, or as the Administrative Agent shall believe in
good faith shall be necessary, under the circumstances as provided in
Sections 16.12 and 13.2) or (ii) in the absence of its own gross
negligence or willful misconduct. The Administrative Agent shall be
deemed not to have knowledge of any Default or Event of Default unless
and until notice describing such Default or Event of Default is given
to the Administrative Agent by any Borrower or a Lender.
The Administrative Agent shall not be responsible for or have
any duty to ascertain or inquire into (i) any statement, warranty or
representation made in or in connection with this Loan Agreement or any
other Loan Document, (ii) the contents of any certificate, report or
other document delivered hereunder or thereunder or in connection
herewith or therewith, (iii) the performance or observance of any of
the covenants, agreements or other terms or conditions set forth herein
or therein or the occurrence of any Default or Event of Default, (iv)
the validity, enforceability, effectiveness or genuineness of this Loan
Agreement, any other Loan Document or any other agreement, instrument
or document or (v) the satisfaction of any condition set forth in
Sections 11 or 12 or elsewhere herein,
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other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent.
14.4. RELIANCE BY ADMINISTRATIVE AGENT. The Administrative
Agent shall be entitled to rely upon, and shall not incur any liability
for relying upon, any notice, request, certificate, consent, statement,
instrument, document or other writing (including any electronic
message, Internet or intranet website posting or other distribution)
believed by it to be genuine and to have been signed, sent or otherwise
authenticated by the proper Person. The Administrative Agent also may
rely upon any statement made to it orally or by telephone and believed
by it to have been made by the proper Person, and shall not incur any
liability for relying thereon. In determining compliance with any
condition hereunder to the making of a Loan that by its terms must be
fulfilled to the satisfaction of a Lender, the Administrative Agent may
presume that such condition is satisfactory to such Lender unless the
Administrative Agent shall have received notice to the contrary from
such Lender prior to the making of such Loan. The Administrative Agent
may consult with legal counsel (who may be counsel for the Borrowers),
independent accountants and other experts selected by it, and shall not
be liable for any action taken or not taken by it in accordance with
the advice of any such counsel, accountants or experts.
14.5. DELEGATION OF DUTIES. The Administrative Agent may
perform any and all of its duties and exercise its rights and powers
hereunder or under any other Loan Document by or through any one or
more sub-agents appointed by the Administrative Agent. The
Administrative Agent and any such sub-agent may perform any and all of
its duties and exercise its rights and powers by or through their
respective Related Parties. The exculpatory provisions of this Section
14 shall apply to any such sub-agent and to the Related Parties of the
Administrative Agent and any such sub-agent, and shall apply to their
respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative
Agent.
14.6. RESIGNATION OF ADMINISTRATIVE AGENT. The Administrative
Agent may at any time give notice of its resignation to the Lenders and
the Borrowers. Upon receipt of any such notice of resignation, the
Required Lenders shall have the right, with the consent of the
Borrowers, to appoint a successor. If no such successor shall have been
so appointed by the Required Lenders and shall have accepted such
appointment within 30 days after the retiring Administrative Agent
gives notice of its resignation, then the retiring Administrative Agent
may on behalf of the Lenders, appoint a successor Administrative Agent
meeting the qualifications set forth above; provided that if the
Administrative Agent shall notify the Borrowers and the Lenders that no
qualifying Person has accepted such appointment, then such resignation
shall nonetheless become effective in accordance with such notice and
(1) the retiring Administrative Agent shall be discharged from its
duties and obligations hereunder and under the other Loan Documents
(except that in the case of any collateral security held by the
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Administrative Agent on behalf of the Lenders under any of the Loan
Documents, the retiring Administrative Agent shall continue to hold
such collateral security until such time as a successor Administrative
Agent is appointed) and (2) all payments, communications and
determinations provided to be made by, to or through the Administrative
Agent shall instead be made by or to each Lender directly, until such
time as the Required Lenders appoint a successor Administrative Agent
as provided for above in this Section. Upon the acceptance of a
successor's appointment as Administrative Agent hereunder, such
successor shall succeed to and become vested with all of the rights,
powers, privileges and duties of the retiring (or retired)
Administrative Agent, and the retiring Administrative Agent shall be
discharged from all of its duties and obligations hereunder or under
the other Loan Documents (if not already discharged therefrom as
provided above in this Section). The fees payable by the Borrowers to a
successor Administrative Agent shall be the same as those payable to
its predecessor unless otherwise agreed between the Borrowers and such
successor. After the retiring Administrative Agent's resignation
hereunder and under the other Loan Documents, the provisions of this
Section and Section 16.3 shall continue in effect for the benefit of
such retiring Administrative Agent, its sub-agents and their respective
Related Parties in respect of any actions taken or omitted to be taken
by any of them while the retiring Administrative Agent was acting as
Administrative Agent.
In the event that (i) the Administrative Agent, whether in its
capacity as the Administrative Agent or a Lender, does not consent (or
fails to respond) to a proposed amendment, modification or waiver to
any provision of this Loan Agreement or any other Loan Document
requested by any Borrower and (ii) such proposed amendment,
modification or waiver has been approved by the Required Lenders, any
Borrower may, upon (x) delivery of written notice thereof to the
Administrative Agent, and (y) receipt by the Administrative Agent of
the amount calculated in accordance with Section 16.13 hereof in
connection with a transfer of the Loans by the Administrative Agent,
require that the Administrative Agent promptly resign from such
position, such resignation, and the appointment of a successor
Administrative Agent to be consummated in accordance with the first
paragraph of this Section 14.6.
14.7. NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS.
Each Lender acknowledges that it has, independently and without
reliance upon the Administrative Agent or any other Lender or any of
their Related Parties and based on such documents and information as it
has deemed appropriate, made its own credit analysis and decision to
enter into this Loan Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon the Administrative Agent
or any other Lender or any of their Related Parties and based on such
documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking
action under or based upon this Loan Agreement, any other Loan Document
or any related agreement or any document furnished hereunder or
thereunder.
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14.8. ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM. In case
of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to a Borrower, the Administrative
Agent (irrespective of whether the principal of any Loan shall then be
due and payable as herein expressed or by declaration or otherwise and
irrespective of whether the Administrative Agent shall have made any
demand on such Borrower) shall be entitled and empowered, by
intervention in such proceeding or otherwise
(a) to file and prove a claim for the whole amount of the
principal and interest owing and unpaid in respect of the Loans and all
other Obligations that are owing and unpaid and to file such other
documents as may be necessary or advisable in order to have the claims
of the Lenders and the Administrative Agent (including any claim for
the reasonable compensation, expenses, disbursements and advances of
the Lenders and the Administrative Agent and their respective agents
and counsel) and all other amounts due the Lenders and the
Administrative Agent under Sections 5.1 and 16.3 allowed in such
judicial proceeding; and
(b) to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Sections 5.1 and 16.3.
Nothing contained herein shall be deemed to authorize the
Administrative Agent to authorize or consent to or accept or adopt on
behalf of any Lender any plan of reorganization, arrangement,
adjustment or composition affecting the Obligations or the rights of
any Lender or to authorize the Administrative Agent to vote in respect
of the claim of any Lender in any such proceeding.
14.9. COLLATERAL MATTERS. The Lenders irrevocably authorize
the Administrative Agent, at its option and in its discretion,
(a) to release any Lien on any property granted to or held by
the Administrative Agent under any Loan Document (i) upon termination
of the Aggregate Commitments and payment in full of all Obligations
(other than contingent indemnification obligations), (ii) that is sold
or to be sold as part of or in connection with any sale permitted
hereunder or under any other Loan Document, or (iii) subject to Section
16.12, if approved, authorized or ratified in writing by the Required
Lenders;
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(b) to subordinate any Lien on any property granted to or held
by the Administrative Agent under any Loan Document to the holder of
any Lien on such property that is permitted by Section 9.3(viii); and
(c) to take the actions with respect to the Collateral as are
set forth in the Security Documents.
The Lenders hereby agree that the Security Documents may be
enforced only by the action of the Administrative Agent, in each case,
acting upon the instructions of the Required Lenders, and that no
Lender shall have any right individually to seek to enforce or to
enforce the Security Documents to realize upon the security to be
granted hereby, it being understood and agreed that such rights and
remedies may be exercised by the Administrative Agent for the benefit
of the Lender upon the terms of this Agreement and the Security
Documents.
Upon request by the Administrative Agent at any time, the
Required Lenders will confirm in writing the Administrative Agent's
authority to release or subordinate its interest in particular types or
items of property.
15. SUCCESSORS AND ASSIGNS.
15.1. GENERAL CONDITIONS. The provisions of this Loan
Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns permitted hereby,
except that none of the Borrowers may assign or otherwise transfer any
of its rights or Obligations hereunder without the prior written
consent of each Lender and no Lender may assign or otherwise transfer
any of its rights or obligations hereunder except (a) to an Eligible
Assignee in accordance with the provisions of Section 15.2, (b) by way
of participation in accordance with the provisions of Section 15.4 or
(c) by way of pledge or assignment of a security interest subject to
the restrictions of Section 15.6 (and any other attempted assignment or
transfer by any party hereto shall be null and void). Nothing in this
Loan Agreement, expressed or implied, shall be construed to confer upon
any Person (other than the parties hereto, their respective successors
and assigns permitted hereby, Participants to the extent provided in
Section 15.4, and, to the extent expressly contemplated hereby, the
Related Parties of each of the Administrative Agent and the Lenders)
any legal or equitable right, remedy or claim under or by reason of
this Loan Agreement or any of the other Loan Documents.
15.2. ASSIGNMENTS BY LENDERS. Any Lender may at any time
assign to one or more Eligible Assignees all or a portion of its rights
and obligations under this Loan Agreement (including all or a portion
of its Commitment and the Loans at the time owing to it); provided that
(i) except in the case of an assignment of the entire
remaining amount of the assigning Lender's Commitment and the
Loans at the time owing to it or in the case of an assignment
to a Lender or an Affiliate of a
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Lender, the aggregate amount of the Commitment (which for this
purpose includes Loans outstanding thereunder) or, if the
Commitment is not then in effect, the principal outstanding
balance of the Loans of the assigning Lender subject to each
such assignment, determined as of the date the Assignment and
Assumption with respect to such assignment is delivered to the
Administrative Agent or, if a "Trade Date" is specified in the
Assignment and Assumption, as of the Trade Date, shall not be
less than $15,000,000 unless each of the Administrative Agent
and, so long as no Designated Event of Default has occurred
and is continuing, the Borrowers otherwise consent (each such
consent not to be unreasonably withheld or delayed);
(ii) each partial assignment shall be made as an
assignment of a proportionate part of all the assigning
Lender's rights and obligations under this Loan Agreement with
respect to the Loans or the Commitment assigned, it being
understood that non-pro rata assignments of or among any of
the Commitments and Loans are not permitted;
(iii) any assignment of a Commitment or Loan must be
approved by the Administrative Agent and, so long as no
Designated Event of Default has occurred and is continuing,
the Borrowers (each such consent not to be unreasonably
withheld or delayed) unless the Person that is the proposed
assignee is itself a Lender (whether or not the proposed
assignee would otherwise qualify as an Eligible Assignee);
(iv) so long as Fortis is the Administrative Agent, any
assignment by Fortis or any of its Affiliates of all or a
portion of its Commitments or Loans that would result in
Fortis and its Affiliates holding in aggregate less than
twenty percent (20%) of the Aggregate Commitments, or, if the
Commitments are not then in effect, the aggregate Loan
outstanding, shall require, so long as no Designated Event of
Default has occurred and is continuing, the consent of the
Borrowers (each such consent not to be unreasonably withheld
or delayed; and
(v) the parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and
Assumption, together with a processing and recordation fee of
$3,500, and the Eligible Assignee, if it shall not be a
Lender, shall deliver to the Administrative Agent an
Administrative Questionnaire.
Subject to acceptance and recording thereof by the
Administrative Agent pursuant to Section 15.3, from and after the
effective date specified in each Assignment and Assumption, the
Eligible Assignee thereunder shall be a party to this Loan Agreement
and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Loan
Agreement, and the assigning Lender thereunder shall, to the extent of
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the interest assigned by such Assignment and Assumption, be released
from its obligations under this Loan Agreement (and, in the case of an
Assignment and Assumption covering all of the assigning Lender's rights
and obligations under this Loan Agreement, such Lender shall cease to
be a party hereto) but shall continue to be entitled to the benefits of
Sections 5.2.2, 5.6 and 16.3 with respect to facts and circumstances
occurring prior to the effective date of such assignment. Upon request,
the Borrowers (at their expense) shall execute and deliver a Revolving
Credit Note to the assignee Lender. Any assignment or transfer by a
Lender of rights or obligations under this Loan Agreement that does not
comply with this subsection shall be treated for purposes of this Loan
Agreement as a sale by such Lender of a participation in such rights
and obligations in accordance with Section 15.4. Notwithstanding
anything to the contrary contained herein, the Borrowers shall not be
obligated to pay to the Eligible Assignee any amount under Section
5.2.2(a)U that is greater than the amount that the Borrowers would have
been obligated to pay such Eligible Assignee's assignor if such
assigning Lender had not assigned to such Eligible Assignee any of its
rights under this Agreement, unless (1) the circumstances giving rise
to such greater payments did not exist at the time of such assignment,
or (2) the Borrowers consented to the assignment to such Eligible
Assignee.
15.3. REGISTER. The Administrative Agent, acting solely for
this purpose as an agent of the Borrowers, shall maintain at the
Administrative Agent's Office a copy of each Assignment and Assumption
delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitments of, and principal amounts
of the Loans owing to, each Lender pursuant to the terms hereof from
time to time (the "Register"). The entries in the Register shall be
conclusive absent manifest error, and the Borrowers, the Administrative
Agent and the Lenders may treat each Person whose name is recorded in
the Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Loan Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by any
Borrower or any Lender at any reasonable time and from time to time
upon reasonable prior notice. In addition, at any time that a request
for a consent for a material or substantive change to the Loan
Documents is pending, any Lender wishing to consult with other Lenders
in connection therewith may request and receive from the Administrative
Agent a copy of the Register.
15.4. PARTICIPATIONS. Any Lender may at any time, without the
consent of, or notice to, the Borrowers or the Administrative Agent,
sell participations to any Person (other than a natural person or any
Borrower or any of their Affiliates) (each, a "Participant") in all or
a portion of such Lender's rights and/or obligations under this Loan
Agreement (including all or a portion of its Commitment and/or the
Loans owing to it); provided that (i) such Lender's obligations under
this Loan Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Borrowers, the
Administrative Agent and the
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Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Loan
Agreement. Any agreement or instrument pursuant to which a Lender sells
such a participation shall provide that such Lender shall retain the
sole right to enforce this Loan Agreement and to approve any amendment,
modification or waiver of any provision of this Loan Agreement;
provided that such agreement or instrument may provide that such Lender
will not, without the consent of the Participant, agree to any
amendment, modification or waiver that would reduce the principal of or
the interest rate on any Loan, extend the term or increase the amount
of the Commitment of such Lender as it relates to such Participant,
reduce the amount of any Commitment Fee to which such Participant is
entitled or extend any regularly scheduled payment date for principal
or interest. Subject to Section 15.5, the Borrowers agree that each
Participant shall be entitled to the benefits of Sections 5.2.2, 5.6,
5.7 and 5.9 to the same extent as if it were a Lender and had acquired
its interest by assignment pursuant to Section 15.2. To the extent
permitted by law, each Participant also shall be entitled to the
benefits of Section 16.1 as though it were a Lender, provided such
Participant agrees to be subject to Section 15.1 as though it were a
Lender.
15.5. LIMITATIONS UPON PARTICIPANT RIGHTS. A Participant shall
not be entitled to receive any greater payment under Sections 5.2.2,
5.6 or 5.7 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with
the Borrowers' prior written consent. A Participant that would be a
Non-U.S. Lender if it were a Lender shall not be entitled to the
benefits of Section 5.2.2 unless the Borrower is notified of the
participation sold to such Participant and such Participant agrees, for
the benefit of the Borrowers, to comply with Section 5.2.3 as though it
were a Lender.
15.6. CERTAIN PLEDGES. Any Lender may at any time pledge or
assign a security interest in all or any portion of its rights under
this Loan Agreement (including under its Revolving Credit Note) to
secure obligations of such Lender, including any pledge or assignment
to secure obligations to a Federal Reserve Bank; provided that no such
pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for
such Lender as a party hereto.
15.7. ELECTRONIC EXECUTION OF ASSIGNMENTS. The words
"execution," "signed," "signature," and words of like import in any
Assignment and Assumption shall be deemed to include electronic
signatures or the keeping of records in electronic form, each of which
shall be of the same legal effect, validity or enforceability as a
manually executed signature or the use of a paper-based recordkeeping
system, as the case may be, to the extent and as provided for in any
applicable law, including the Federal Electronic Signatures in Global
and National Commerce Act, the New York State Electronic Signatures and
Records
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Act, or any other similar state laws based on the Uniform Electronic
Transactions Act.
16. PROVISIONS OF GENERAL APPLICATIONS.
16.1. SETOFF. Each Borrower hereby grants to the
Administrative Agent and each of the Lenders a continuing lien,
security interest and right of setoff as security for all liabilities
and Obligations to the Administrative Agent and each Lender, whether
now existing or hereafter arising, upon and against all deposits,
credits, collateral and property, now or hereafter in the possession,
custody, safekeeping or control of the Administrative Agent or such
Lender or any Lender Affiliate and their successors and assigns or in
transit to any of them. Regardless of the adequacy of any collateral,
if any of the Obligations are due and payable and have not been paid or
any Event of Default shall have occurred, any deposits or other sums
credited by or due from any of the Lenders to any Borrower and any
securities or other property of any Borrower in the possession of such
Lender may be applied to or set off by the Administrative Agent against
the payment of Obligations and any and all other liabilities, direct,
or indirect, absolute or contingent, due or to become due, now existing
or hereafter arising, of the Borrowers to such Lender. ANY AND ALL
RIGHTS TO REQUIRE ANY LENDER TO EXERCISE ITS RIGHTS OR REMEDIES WITH
RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO
EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS
OR OTHER PROPERTY OF THE BORROWERS ARE HEREBY KNOWINGLY, VOLUNTARILY
AND IRREVOCABLY WAIVED. Each of the Lenders agree with each other
Lender that (a) if an amount to be set off is to be applied to
Indebtedness of the Borrowers to such Lender, other than Indebtedness
evidenced by the Revolving Credit Notes held by such Lender, such
amount shall be applied ratably to such other Indebtedness and to the
Indebtedness evidenced by all such Notes held by such Lender, and (b)
if such Lender shall receive from the Borrowers, whether by voluntary
payment, exercise of the right of setoff, counterclaim, cross action,
enforcement of the claim evidenced by the Revolving Credit Notes held
by such Lender by proceedings against the Borrowers at law or in equity
or by proof thereof in bankruptcy, reorganization, liquidation,
receivership or similar proceedings, or otherwise, any amount in excess
of its ratable portion of the payments received by all of the Lenders
with respect to the Revolving Credit Notes held by all of the Lenders,
such Lender will make arrangements with the Administrative Agent and
the other Lenders with respect to such excess in accordance with the
provisions of Section 4.6.
16.2. EXPENSES. The Borrowers agree to pay, on a joint and
several basis, (a) the reasonable and documented costs of producing and
reproducing this Loan Agreement, the other Loan Documents and the other
agreements and instruments mentioned herein, (b) the reasonable and
documented fees, expenses and disbursements of the Administrative
Agent's Special Counsel and any local
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counsel to the Administrative Agent incurred in connection with the
preparation, syndication, administration or interpretation of the Loan
Documents and other instruments mentioned herein, each closing
hereunder, any amendments, modifications, approvals, consents or
waivers hereto or hereunder, or the cancellation of any Loan Document
upon payment in full in cash of all of the Obligations or pursuant to
any terms of such Loan Document providing for such cancellation, (c)
the reasonable and documented fees, expenses and disbursements of the
Administrative Agent or any of its Affiliates incurred by the
Administrative Agent or such Affiliate in connection with the
preparation, syndication, administration or interpretation of the Loan
Documents and other instruments mentioned herein, (d) any reasonable
and documented fees, costs, expenses and bank charges, including bank
charges for returned checks, incurred the Administrative Agent in
establishing, maintaining or handling agency accounts, lock box
accounts and other accounts for the collection of any of the
Collateral, (e) all reasonable and documented out-of-pocket expenses
(including without limitation reasonable attorneys' fees and costs, and
reasonable consulting, accounting, appraisal, investment banking and
similar professional fees and charges) incurred by the Administrative
Agent in connection with (i) the enforcement of or preservation of
rights under any of the Loan Documents against the Borrowers or the
administration thereof after the occurrence of a Default or Event of
Default and (ii) any litigation, proceeding or dispute whether arising
hereunder or otherwise, in any way related to the Administrative
Agent's relationship with the Borrowers and (f) all reasonable and
documented fees, expenses and disbursements of any Lender or the
Administrative Agent incurred in connection with UCC searches, UCC
filings, or mortgage recordings. The covenants contained in this
Section 16.2 shall survive payment or satisfaction in full of all other
Obligations.
16.3. INDEMNIFICATION. Each Borrower agrees to indemnify and
hold harmless, on a joint and several basis, the Administrative Agent,
each of the Lenders and each of their Affiliates ("Indemnitees") from
and against any and all claims, actions and suits whether groundless or
otherwise, and from and against any and all liabilities, losses,
damages and expenses of every nature and character arising out of this
Loan Agreement or any of the other Loan Documents or the transactions
contemplated hereby (the "Indemnified Liabilities") including, without
limitation, (a) any actual or proposed use by the Borrowers of the
proceeds of any of the Loans, (b) the reversal or withdrawal of any
provisional credits granted by the Administrative Agent or any Lender
upon the transfer of funds from lock box, bank agency, concentration
accounts or otherwise under any cash management arrangements with the
Borrowers or in connection with the provisional honoring of funds
transfers, checks or other items, (c) the Borrowers entering into or
performing this Loan Agreement or any of the other Loan Documents, (d)
any such liability, loss, damage or expense in any way relating to, or
arising out of, the manufacture, ownership, leasing or operation of the
Containers and the other Collateral incurred prior to any foreclosure
on the Collateral, or (e) with respect to the Borrowers and their
respective properties and
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assets, the violation of any Environmental Law, the presence, disposal,
escape, seepage, leakage, spillage, discharge, emission, release or
threatened release of any Hazardous Substances or any action, suit,
proceeding or investigation brought or threatened with respect to any
Hazardous Substances (including, but not limited to, claims with
respect to wrongful death, personal injury or damage to property), in
each case including, without limitation, the reasonable fees and
disbursements of one counsel incurred in connection with any such
investigation, litigation or other proceeding; provided, however, that
the Borrowers shall have no obligation to any Indemnitee hereunder with
respect to Indemnified Liabilities and related costs and expenses (i)
to the extent that such Indemnified Liabilities constitute special,
indirect, consequential or punitive damages or damages or liabilities
based upon any theory of lost profits, or (ii) to the extent that such
Indemnified Liabilities are finally judicially determined to have
resulted from the gross negligence, bad faith, willful misconduct or
recklessness of such Indemnitee (and, upon any such determination, any
indemnification payments with respect to such Indemnified Liabilities
or related costs and expenses previously received by such Indemnitee
shall be promptly reimbursed by such Indemnitee). In litigation, or the
preparation therefor, each Indemnitee shall be entitled to select its
own counsel and, in addition to the foregoing indemnity; provided, that
the Borrowers shall only be obligated under this Section 16.3 to pay
the reasonable and documented fees and expenses of one counsel on
behalf of all Indemnitees. If, and to the extent that the Obligations
of the Borrowers under this Section 16.3 are unenforceable for any
reason, the Borrowers hereby agree to make the maximum contribution to
the payment in satisfaction of such Obligations which is permissible
under applicable law. The covenants contained in this Section 16.3
shall survive payment or satisfaction in full of all other Obligations.
16.4. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.
16.4.1. CONFIDENTIALITY. Each of the Lenders and the
Administrative Agent agrees, on behalf of itself and each of its
Affiliates, directors, officers, employees and representatives, to use
reasonable precautions to keep confidential, in accordance with their
customary procedures for handling confidential information of the same
nature and in accordance with safe and sound banking practices, any
information supplied to it by, or on behalf of, the Borrowers pursuant
to this Loan Agreement, provided that nothing herein shall limit the
disclosure of any such information (a) after such information shall
have become public other than through a violation of this Section 16.4,
or becomes available to any of the Lenders or the Administrative Agent
on a nonconfidential basis from a source other than the Borrowers, (b)
to the extent required by statute, rule, regulation or judicial
process, (c) to counsel for any of the Lenders or the Administrative
Agent, (d) to bank examiners or any other regulatory authority having
jurisdiction over any Lender or the Administrative Agent, or to
auditors or accountants, (e) to the Administrative Agent, any Lender or
any Financial Affiliate, (f) in connection with any litigation to which
any one or more of the Lenders, the Administrative Agent or any
Financial Affiliate is a party, or in
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connection with the enforcement of rights or remedies hereunder or
under any other Loan Document, (g) to a Lender Affiliate or a
Subsidiary or affiliate of the Administrative Agent, (h) to any actual
or prospective assignee or participant or any actual or prospective
counterparty (or its advisors) to any swap or derivative transactions
referenced to credit or other risks or events arising under this Loan
Agreement or any other Loan Document so long as such assignee,
participant or counterparty, as the case may be, agrees to be bound by
the provisions of this Section 16.4 or (i) with the prior written
consent of the Borrowers. Each of the Administrative Agent, the Lenders
and the Financial Affiliates agrees not to use any information supplied
to it by, or on behalf, of the Borrowers pursuant to this Loan
Agreement for any purpose or in any manner other that evaluating the
performance of the Borrowers and their Subsidiaries hereunder and
enforcing the rights, remedies and obligations hereunder and under the
other Loan Documents. Without the prior written consent of the
Borrowers, none of the Administrative Agent, any Lender or any
Financial Affiliate shall be permitted to refer to any of the Borrowers
in connection with any advertising, promotion or marketing undertaken
by the Administrative Agent, such Lenders or such Financial Affiliate.
16.4.2. PRIOR NOTIFICATION. Unless specifically prohibited by
applicable law or court order, each of the Lenders and the
Administrative Agent shall, prior to disclosure thereof, notify the
Borrowers of any request for disclosure of any such information by any
governmental agency or representative thereof (other than any such
request in connection with an examination of the financial condition of
such Lender by such governmental agency) or pursuant to legal process.
16.4.3. OTHER. In no event shall any Lender or the
Administrative Agent be obligated or required to return any materials
furnished to it or any Financial Affiliate by the Borrowers. The
obligations of each Lender under this Section 16.4 shall supersede and
replace the obligations of such Lender under any confidentiality letter
in respect of this financing signed and delivered by such Lender to the
Borrowers prior to the date hereof and shall be binding upon any
assignee of, or purchaser of any participation in, any interest in any
of the Loans from any Lender.
16.5. SURVIVAL OF COVENANTS, ETC. All covenants, agreements,
representations and warranties made herein, in the Revolving Credit
Notes, in any of the other Loan Documents or in any documents or other
papers delivered by or on behalf of the Borrowers pursuant hereto shall
be deemed to have been relied upon by the Lenders and the
Administrative Agent, notwithstanding any investigation heretofore or
hereafter made by any of them, and shall survive the making by the
Lenders of any Loans as herein contemplated, and shall continue in full
force and effect so long as any amount due under this Loan Agreement or
the Revolving Credit Notes or any of the other Loan Documents remains
outstanding or any Lender has any obligation to make any Loans and for
such further time as may be otherwise expressly specified in this Loan
Agreement. All statements
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contained in any certificate or other paper delivered to any Lender or
the Administrative Agent at any time by or on behalf of the Borrowers
pursuant hereto or in connection with the transactions contemplated
hereby shall constitute representations and warranties by the Borrowers
hereunder.
16.6. NOTICES. Except as otherwise expressly provided in this
Loan Agreement, all notices and other communications made or required
to be given pursuant to this Loan Agreement or the Revolving Credit
Notes shall be in writing and shall be delivered in hand, mailed by
United States registered or certified first class mail, postage
prepaid, sent by overnight courier, or sent by telegraph, telecopy,
facsimile or telex and confirmed by delivery via courier or postal
service, addressed as follows:
(a) if to TOL, at: c/o TAL International Container
Corporation, 000 Xxxxxxxxxxxxxx Xxxx, Xxxxxxxx, Xxx Xxxx 00000-0000, or
at such other addresses for notice as TOL shall last have furnished in
writing to the Person giving the notice;
(b) if to TLI at: c/o TAL International Container Corporation,
000 Xxxxxxxxxxxxxx Xxxx, Xxxxxxxx, Xxx Xxxx 00000-0000, or at such
other addresses for notice as TLI shall last have furnished in writing
to the Person giving the notice;
(c) if to TOCC, at: c/o TAL International Container
Corporation, 000 Xxxxxxxxxxxxxx Xxxx, Xxxxxxxx, Xxx Xxxx 00000-0000, or
at such other addresses for notice as TOCC shall last have furnished in
writing to the Person giving the notice;
(d) if to the Administrative Agent, at 3000 AS Rotterdam, The
Netherlands - RO1.16.02, Attention: Aviation and Intermodal Finance
Group, or such other address for notice as the Administrative Agent
shall last have furnished in writing to the Person giving the notice;
and
(e) if to any Lender, at such Lender's address set forth on
Schedule 1 hereto, or such other address for notice as such Lender
shall have last furnished in writing to the Person giving the notice.
Any such notice or demand shall be deemed to have been duly
given or made and to have become effective (i) if delivered by hand,
overnight courier or facsimile to a responsible officer of the party to
which it is directed, at the time of the receipt thereof by such
officer or the sending of such facsimile and (ii) if sent by registered
or certified first-class mail, postage prepaid, on the sixth Business
Day following the mailing thereof. Any notice or other communication to
be made hereunder or under the Revolving Credit Notes, even if
otherwise required to be in writing under other provisions of this Loan
Agreement or the Revolving Credit Notes may alternatively be made in an
electronic record transmitted electronically under such authentication
and other procedures as the parties hereto
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may from time to time agree in writing (but not an electronic record),
and such electronic transmission shall be effective at the time set
forth in such procedures. Unless otherwise expressly provided in such
procedures, such an electronic record shall be equivalent to a writing
under the other provisions of this Loan Agreement or the Revolving
Credit Notes and such authentication, if made in compliance with the
procedures so agreed by the parties hereto in writing (but not an
electronic record), shall be equivalent to a signature under the other
provisions of this Loan Agreement or the Revolving Credit Notes.
16.7. GOVERNING LAW. THIS LOAN AGREEMENT AND, EXCEPT AS
OTHERWISE SPECIFICALLY PROVIDED THEREIN, EACH OF THE OTHER LOAN
DOCUMENTS ARE CONTRACTS UNDER THE LAWS OF THE STATE OF NEW YORK AND
SHALL FOR ALL PURPOSES BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE LAWS OF SAID STATE OF NEW YORK (INCLUDING SECTIONS 5-1401 AND
5-1402 OF THE GENERAL OBLIGATIONS LAW BUT OTHERWISE EXCLUDING THE LAWS
APPLICABLE TO CONFLICTS OR CHOICE OF LAW). EACH BORROWER AGREES THAT
ANY SUIT FOR THE ENFORCEMENT OF THIS LOAN AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR
ANY FEDERAL COURT SITTING THEREIN AND CONSENTS TO THE NONEXCLUSIVE
JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT
BEING MADE UPON THE BORROWERS BY MAIL AT THE ADDRESS SPECIFIED IN
SECTION 16.6. THE BORROWERS HEREBY WAIVE ANY OBJECTION THAT THEY MAY
NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT
OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT.
16.8. HEADINGS. The captions in this Loan Agreement are for
convenience of reference only and shall not define or limit the
provisions hereof.
16.9. COUNTERPARTS. This Loan Agreement and any amendment
hereof may be executed in several counterparts and by each party on a
separate counterpart, each of which when executed and delivered shall
be an original, and all of which together shall constitute one
instrument. In proving this Loan Agreement it shall not be necessary to
produce or account for more than one such counterpart signed by the
party against whom enforcement is sought. Delivery by facsimile by any
of the parties hereto of an executed counterpart hereof or of any
amendment or waiver hereto shall be as effective as an original
executed counterpart hereof or of such amendment or waiver and shall be
considered a representation that an original executed counterpart
hereof or such amendment or waiver, as the case may be, will be
delivered.
16.10. ENTIRE AGREEMENT, ETC. The Loan Documents and any other
documents executed in connection herewith or therewith express the
entire
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understanding of the parties with respect to the transactions
contemplated hereby. Neither this Loan Agreement nor any term hereof
may be changed, waived, discharged or terminated, except as provided in
Section 16.12.
16.11. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
WAIVES ITS RIGHTS TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM
ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS LOAN AGREEMENT, THE
REVOLVING CREDIT NOTES OR ANY OF THE OTHER LOAN DOCUMENTS, ANY RIGHTS
OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE PERFORMANCE OF SUCH
RIGHTS AND OBLIGATIONS OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY,
INCLUDING ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR
ACTIONS OF THE ADMINISTRATIVE AGENT OR ANY LENDER RELATING TO THE
ADMINISTRATION OF THE LOANS OR ENFORCEMENT OF THE LOAN DOCUMENTS AND
AGREES THAT IT WILL NOT SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY
OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED.
Except as prohibited by law, each Borrower hereby waives any right it
may have to claim or recover in any litigation referred to in the
preceding sentence any special, exemplary, punitive or consequential
damages or any damages other than, or in addition to, actual damages.
Each Borrower (a) certifies that no representative, agent or attorney
of any Lender or the Administrative Agent has represented, expressly or
otherwise, that the Administrative Agent would not, in the event of
litigation, seek to enforce the foregoing waivers and (b) acknowledges
that the Administrative Agent and the Lenders have been induced to
enter into this Loan Agreement and the other Loan Documents to which it
is a party by, among other things, the waivers and certifications
contained herein.
16.12. CONSENTS, AMENDMENTS, WAIVERS, ETC. Any consent or
approval required or permitted by this Loan Agreement to be given by
the Lenders may be given, and any term of this Loan Agreement, the
other Loan Documents or any other instrument related hereto or
mentioned herein may be amended, and the performance or observance by
the Borrowers of any terms of this Loan Agreement, the other Loan
Documents or such other instrument or the continuance of any Default or
Event of Default may be waived (either generally or in a particular
instance and either retroactively or prospectively) with, but only
with, the written consent of the Borrowers and the written consent of
the Required Lenders. Notwithstanding the foregoing, no amendment,
modification or waiver shall:
(a) without the written consent of the Borrowers and each
Lender directly affected thereby:
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(i) reduce, delay or forgive the principal amount of any
Loans or reduce the rate of interest on the Loans or the
priority thereof or the amount of any Fees (other than
interest on the Revolving Credit Notes accruing pursuant to
Section 5.10 following the effective date of any waiver by the
Required Lenders of the Event of Default relating thereto);
(ii) increase the amount of such Lender's Commitment or
extend the expiration date of such Lender's Commitment;
(iii) postpone or extend the Legal Final Payment Date or
any other regularly scheduled dates for payments of principal
of, or interest on, the Loans or any Fees or other amounts
payable to such Lender (it being understood that (A) a waiver
of the application of the default rate of interest pursuant to
Section 5.10, and (B) any vote to rescind any acceleration
made pursuant to Section 13.1 of amounts owing with respect to
the Loans and other Obligations shall require only the
approval of the Required Lenders); and
(iv) other than pursuant to a Permitted Securitization or
any other transaction permitted by the terms of this Loan
Agreement, release all or substantially all of the Collateral
(excluding, if the Borrowers or any Subsidiary of a Borrower
becomes a debtor under the Federal Bankruptcy Code or other
applicable insolvency laws, the release of "cash collateral",
as defined in Section 363(a) of the federal Bankruptcy Code or
any analogous provision of any applicable insolvency law
pursuant to a cash collateral stipulation with the debtor
approved by the Required Lenders);
(b) without the written consent of all of the Lenders, amend
or waive this Section 16.12 or the definition of "Required Lenders";
(c) without the written consent of the Administrative Agent,
amend or waive Section 14, the amount or time of payment of any Agent
Fee payable for the Administrative Agent's account or any other
provision applicable to the Administrative Agent;
(d) without the consent of the holder of the Seller Loan or
the trustee of the High Yield Bonds, as the case may be, reduce, delay
or forgive the IO Distributable Amount otherwise payable to the holder
of the Seller Loan or the trustee of the High Yield Bonds; or
(e) without the consent of any affected counterparty (other
than any Borrower or any of its Affiliates) to any Hedging Agreement,
reduce, delay, forgive or change the relative priority of any amounts
owing to such Person in accordance with the terms hereof.
No waiver shall extend to or affect any obligation not
expressly waived or impair any right consequent thereon. No course of
dealing or delay or omission
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on the part of the Administrative Agent or any Lender in exercising any
right shall operate as a waiver thereof or otherwise be prejudicial
thereto. No notice to or demand upon the Borrowers shall entitle the
Borrowers to other or further notice or demand in similar or other
circumstances.
16.13. REPLACEMENT OF LENDERS.
(a) In the event (i) any Lender delivers a certificate
requesting compensation pursuant to Section 5.6 or 5.7, (ii) any Lender
delivers a notice described in Section 5.4 or 5.5, (iii) any Borrower
is required to pay any additional amount to any Lender or any
Governmental Authority on account of any Lender pursuant to Section
5.2.2 or (iv) any Lender does not consent (or fails to respond) to a
proposed amendment, modification or waiver to any provision of this
Loan Agreement or any other Loan Document requested by any Borrower,
any Borrower may, at its sole expense and effort, upon notice to such
Lender and the Administrative Agent, require such Lender to transfer
and assign, without recourse (in accordance with and subject to the
restrictions contained in Section 15.2), all of its interests, rights
and obligations under this Loan Agreement to an assignee that shall
assume such assigned obligations (which assignee may be another Lender,
if a Lender accepts such assignment); provided that:
(i) the Borrowers shall have paid to the Administrative
Agent the assignment fee specified in Section 15.2;
(ii) such Lender shall have received payment of an amount
equal to the outstanding principal of its Loans, accrued
interest thereon, accrued fees and all other amounts payable
to it hereunder and under the other Loan Documents (including
any amounts under Section 5.9) from the assignee (to the
extent of such outstanding principal and accrued interest and
fees) or the Borrowers (in the case of all other amounts);
(iii) in the case of any such assignment resulting from a
claim for compensation under Section 5.6 or 5.7 or payments
required to be made pursuant to Section 5.2.2, such assignment
will result in a reduction in such compensation or payments
thereafter; and
(iv) such assignment does not conflict with applicable
laws.
In connection with any such replacement, if the replaced Lender does
not execute and deliver to the Administrative Agent a duly completed
Assignment and Assumption reflecting such replacement within five
Business Days of the date on which the replacement Lender executes and
delivers such Assignment and Assumption to the replaced Lender, then
such replaced Lender shall be deemed to have executed and delivered
such Assignment and Assumption. A Lender shall not be required to make
any such assignment or delegation if, prior thereto, as a
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result of a waiver by such Lender or otherwise, the circumstances
entitling the Borrowers to require such assignment and delegation cease
to apply.
(b) If (i) any Lender shall request compensation under Section
5.6 or 5.7, (ii) any Lender delivers a notice described in Section 5.4
or 5.5, or (iii) any Borrower is required to pay any additional amount
to any Lender or any Governmental Authority on account of any Lender
pursuant to Section 5.2.2, then such Lender shall use reasonable
efforts (which shall not require such Lender to incur an unreimbursed
loss or unreimbursed cost or expense or otherwise take any action
inconsistent with its internal policies or legal or regulatory
restrictions or suffer any disadvantage or burden deemed by it to be
significant) (x) to file any certificate or document reasonably
requested in writing by any Borrower or (y) to assign its rights and
delegate and transfer its obligations hereunder to another of its
offices, branches or affiliates, if such filing or assignment would
reduce its claims for compensation under Section 5.6 or 5.7, enable it
to withdraw its notice pursuant to Section 5.4 or 5.5, or would reduce
amounts payable pursuant to Section 5.2.2, as the case may be, in the
future. The Borrowers hereby agree to pay all reasonable costs and
expenses incurred by any Lender in connection with any such filing or
assignment, delegation and transfer.
16.14. SEVERABILITY. The provisions of this Loan Agreement are
severable and if any one clause or provision hereof shall be held
invalid or unenforceable in whole or in part in any jurisdiction, then
such invalidity or unenforceability shall affect only such clause or
provision, or part thereof, in such jurisdiction, and shall not in any
manner affect such clause or provision in any other jurisdiction, or
any other clause or provision of this Loan Agreement in any
jurisdiction.
16.15. USA PATRIOT ACT. Each Lender hereby notifies the
Borrowers that pursuant to the requirements of the USA PATRIOT Act
(Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the
"Patriot Act"), it is required to obtain, verify and record information
that identifies the Borrowers, which information includes the name and
address of the Borrowers and other information that will allow such
Lender to identify the Borrowers in accordance with the Patriot Act.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the undersigned have duly executed this
Loan Agreement as of the date first set forth above.
TRANSAMERICA LEASING INC.
By: ________________________
Name:
Title:
TRANS OCEAN LTD.
By: ________________________
Name:
Title:
TRANS OCEAN CONTAINER CORPORATION
By: ________________________
Name:
Title:
FORTIS BANK (NEDERLAND), N.V., as
Administrative Agent
By: ________________________
Name:
Title:
By: ________________________
Name:
Title:
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