Exhibit 10(r)
CREDIT RESTRUCTURE AGREEMENT
By and among
OTR Express, Inc.
and
PACCAR Financial Corp.
As of October 1, 2000
TABLE OF CONTENTS
Page
RECITALS 1
1.0 PARTIES 1
2.0 ACKNOWLEDGEMENT OF THE EXISTING INDEBTEDNESS; CLAIMS 1
3.0 RESTRUCTURE OF THE INDEBTEDNESS 2
3.1 Restructuring of Contracts 2
3.2 Collateral 4
3.3 Documentation 4
3.4 Prepayment 4
4.0 CONVENANTS BY OTR 5
5.0 REPRESENTATIONS AND WARRANTIES 6
6.0 CLOSING DATE 7
7.0 RELEASE OF ALL CLAIMS 7
8.0 REVIVAL CLAUSE 8
9.0 CONDITIONS PRECEDENT TO PFC'S OBLIGATIONS 8
10.0 POST-CLOSING OBLIGATIONS 9
11.0 DEFAULT 9
12.0 RIGHTS AND REMEDIES OF PFC UPON DEFAULT 9
13.0 ATTORNEYS' FEES AND EXPENSES 11
14.0 INTEDRATION 11
15.0 ADDITIONAL ASSURANCES 11
16.0 FORM AND CONTENT OF DOCUMENTS 11
17.0 WAIVER OR FORBEARANCE 11
18.0 MISCELLANEOUS 11
18.1 Gender and Person 11
18.2 Notices 12
18.3 Section and Paragraph Headings 12
18.4 Time of Essence 12
18.5 No Assignment; Binding Effect 12
18.6 Recitals Incorporated 12
18.7 Exhibits Incorporated 12
18.8 Survival of Representations 12
18.9 Governing Law 12
18.10 Severability 12
18.11 Counterparts 13
18.12 Construction 13
18.13 Venue; Jurisdiction; Jury Trial Waiver 13
CREDIT RESTRUCTURE AGREEMENT
This CREDIT RESTRUCTURE AGREEMENT ( the "AGREEMENT") is entered into by
and between PACCAR Financial Corp., a Washington corporation ("PFC"),
and OTR Express, Inc., a Kansas corporation ("OTR"). This AGREEMENT is
entered into with respect to the following agreed upon facts:
RECITALS
A. PFC has from time to time extended credit accommodations to OTR as
evidenced by the documents and instruments set forth on Exhibit "A"
attached hereto (collectively, the "EXISTING DOCUMENTS"). The
credit accommodations consist of thirty-three (33) Security
Agreement Retail Installment Contracts (collectively, the
"CONTRACTS") with an aggregate payoff of $6,840,363.78 (Six Million
Eight Hundred Forty Thousand Three Hundred Sixty Three and 78/100
Dollars) as of October 1, 2000 ("EXISTING DEBT").
B. As of October 1, 2000, OTR was in violation of certain terms of the
CONTRACTS, including but not limited to failure to pay monthly
installment payments when due. By reason of the foregoing default,
all sums due PFC under the CONTRACTS described in Recital A are now
due and owing.
C. Notwithstanding the foregoing default, OTR has requested that PFC:
(i) forebear from exercising its rights and remedies against OTR;
and (ii) restructure the terms of the CONTRACTS described in Recital
A.
D. PFC, without waiving any rights it may have, is willing to accede to
OTR's request to restructure the EXISTING DEBT, on the terms
described in this AGREEMENT and the documents executed in connection
herewith (collectively, the "NEW LOAN DOCUMENTS"). The NEW LOAN
DOCUMENTS and the EXISTING DOCUMENTS delineate all of the terms and
conditions of the relationship between the parties hereto and are
collectively referred to herein as the "LOAN DOCUMENTS."
Now, Therefore, in consideration of the foregoing agreed upon facts and
recitals, which are incorporated herein, and the terms and conditions
hereof, the parties agree as follows:
1.0 PARTIES
1.1 OTR is a corporation organized and existing under and
by virtue of the laws of the State of Kansas.
1.2 PFC is a secured equipment lender organized and
existing under and by virtue of the laws of the State
of Washington.
2.0 ACKNOWLEDGMENT OF THE EXISTING INDEBTEDNESS; CLAIMS
2.1 OTR acknowledges that it is indebted to PFC for all of
the following debts (collectively, the "INDEBTEDNESS"):
(i) repayment of the EXISTING DEBT described in Recital
A hereof; (ii) all costs, fees (including, without
limitation, reasonable and customary attorneys' fees)
and expenses incurred by PFC under or in connection with
the LOAN DOCUMENTS, whether now existing or hereafter
incurred by PFC; and (iii) all accrued and accruing
interest and late charges on the foregoing sums.
2.2 OTR acknowledges that it has no defense, counterclaim,
offset, cross-complaint, claim or demand of any kind or
nature whatsoever (collectively, "CLAIMS") that can be
asserted to reduce or eliminate all or any part of their
liability to repay the INDEBTEDNESS which is now due and
owing, or to seek affirmative relief or damages of any
kind or nature from PFC. To the extent that any such
CLAIM exists, it is fully, forever and irrevocably
released as provided in Section 7.0 hereof.
3.0 RESTRUCTURE OF THE INDEBTEDNESS. Provided no additional
default or event of default occurs under the EXISTING
DOCUMENTS before the CLOSING DATE and all conditions precedent
to the CLOSING are satisfied (as the terms CLOSING DATE and
CLOSING are defined in Section 6.0 hereof), including, without
limitation, the conditions precedent set forth in Section 9.0
hereof), unless waived by PFC in its sole and absolute
discretion, PFC agrees to: (i) forebear from exercising (but
is not waiving) any of its rights or remedies arising by
virtue of the existing defaults until an EVENT OF DEFAULT
occurs (other than existing defaults), and (ii) restructure
the INDEBTEDNESS as follows:
3.1 Restructuring of CONTRACTS.
3.1.1 Payment Modification.
a. OTR will make regular monthly interest
payments, at the contractual rate of interest,
on all INDEBTEDNESS during the months of
October and November 2000; and January,
February, March 2001.
b. OTR will make principal payments relating to
the INDEBTEDNESS during the months of October
and November 2000; and January, February, March
2001, as follows:
October 2000 $53,385
November 2000 $50,370
January 2001 $50,516
February 2001 $61,731
March 2001 $50,762
The scheduled principal payments will be due on
or before the last day of the respective
months; and will be reduced on a
pro-rata basis as equipment is returned to PFC
for liquidation.
c. OTR will be required to make additional
principal payments to PFC, Associates,
International Finance and Mercedes-Benz Credit
Corporation when OTR's availability under its
working capital line with HSBC exceeds $700,000
as an average for any period of ten business
days. Such payment would be paid by OTR within
10 days of the corresponding month end. OTR
will pay an amount equal to 100% of the
availability on said working capital line in
excess of $700,000. PFC and the other lenders
will share in the additional principal payment
on a pro rata basis, in accordance with any
agreement made by and between PFC and the other
lenders.
d. No principal or interest payment will be due
during the month of December 2000 in
consideration of the cash flow requirements
associated with baseplate renewal.
e. OTR will resume standard contract payments in
April 2001 and continue with those payments
until the principal, interest, fees and other
charges are paid in full at the contractual
rate of interest.
3.1.2 Equipment Liquidation.
a. OTR agrees to make available for sale or
transfer, 45 (forty-five) PFC-financed trucks
(the "RETURNED EQUIPMENT").
b. OTR will store, insure and safeguard the
RETURNED EQUIPMENT at its expense.
c. PFC will liquidate the RETURNED EQUIPMENT and
shall control the timing and method of sale.
All sale proceeds will be retained by PFC and
applied against the INDEBTEDNESS.
d. PFC will have the option of requiring the
return of 10 (ten) additional PFC-financed
trucks per month during the months of January,
February and March 2001. PFC may exercise said
option by providing written notice to OTR.
3.1.3 Deficiency.
a. In the event a truck is sold for less
than full payoff, a deficiency note will be
created of even date with the sale.
b. OTR will make monthly interest only
payments on all deficiency notes through March
2001. Monthly payments will be due on the last
day of each month. The notes will accrue
interest at the rate of 10% (ten percent) per
annum.
c. All deficiency notes will be consolidated
into a single, fully amortized 48-month note on
April 1, 2001. The first payment under the
fully amortized note will be due on May 1,
2001.
d. OTR acknowledges that all deficiency
notes are, and will continue to be, cross-
collateralized with all remaining COLLATERAL
(as the term "COLLATERAL" is defined in
Section 3.2.1).
3.1.4 Pledge of Additional Security.
a. OTR will provide PFC with a second lien position on the
real property, and improvements thereon located at 804
N. Meadowbrook Drive, Olathe, KS, owned by OTR.
It is understood that OTR will be providing
similar lien positions to secured equipment
lenders Associates, Navistar Financial Corp.
and Mercedes-Benz Credit Corporation ("SECURED
EQUIPMENT LENDERS"). The SECURED EQUIPMENT
LENDERS will execute an intercreditor agreement
to share equitably in the second lien position.
3.2 Collateral.
3.2.1 OTR's obligations under the LOAN DOCUMENTS,
including, but not limited to, its obligation
to repay the INDEBTEDNESS, shall continue to be
secured by the COLLATERAL (described below).
OTR grants to PFC (and reaffirms its prior
grant in the LOAN DOCUMENTS of ) a security
interest in all rolling stock property
described on Exhibit "B" attached hereto
(collectively, the "COLLATERAL"). OTR shall
take such additional actions and execute such
agreements and other documents as PFC deems
reasonably necessary or convenient to perfect,
maintain, evidence, or continue PFC's security
interest in the COLLATERAL (and its first
priority thereof).
3.2.2 The locations listed on Exhibit "B" attached
hereto is a complete listing of all locations
of the COLLATERAL. OTR covenants that such
COLLATERAL shall not be sold, transferred,
assigned, pledged or hypothecated without the
prior written consent of PFC.
3.2.3 All collateral shall be insured with physical
damage insurance pursuant to the terms
contained within the EXISTING DOCUMENTS. The
maximum deductible allowed under physical
damage insurance coverage shall be $50,000 per
unit, per occurrence.
3.2.4 OTR agrees to establish and fund an escrow
account for the benefit of the SECURED
EQUIPMENT LENDERS to cover the cost (i.e.
deductible) of vehicular accidents in which the
amount of physical damage to vehicles owned by
OTR is between $10,000 and $50,000. OTR agrees
to fund the escrow account by depositing
$20,000 per month for five months beginning in
January 2001. OTR agrees to replenish the
account so that it maintains a $100,000 balance
after May 1, 2001.
3.3 Documentation.
3.3.1 OTR shall execute and deliver to PFC all
documents deemed necessary and appropriate by
PFC to accomplish the transactions contemplated
herein. The documents shall include, without
limitation, the NEW LOAN DOCUMENTS described on
Exhibit C attached hereto. All NEW LOAN
DOCUMENTS shall be in form and substance
satisfactory to PFC and its counsel.
Except as provided herein to the contrary, OTR
acknowledges and confirms that the terms and
conditions of the EXISTING DOCUMENTS: (i) have
not been amended or modified; (ii) shall remain
in full force and effect and shall survive the
CLOSING DATE; and (iii) are enforceable in
accordance with their terms.
3.4 Prepayment. OTR may at any time and from time to time
prepay any of the INDEBTEDNESS without penalty.
4.0 COVENANTS BY OTR. In addition to the covenants set forth in
the other LOAN DOCUMENTS, OTR shall do (or not do, as the case
may be) all of the following:
4.1 Officer's Certificate. At the time of the delivery of
any financial statements pursuant to the terms of the
LOAN DOCUMENTS, OTR shall deliver a certificate of the
Chief Financial Officer of OTR (see Exhibit "D"
attached) to the effect that, to the best knowledge of
the Chief Financial Officer: (i) no default or EVENT OF
DEFAULT has occurred and is continuing or, if any
default or EVENT OF DEFAULT has occurred and is
continuing, specifying the nature and extent thereof;
and (ii) such financial statements are true and
complete.
4.2 Equipment. With the exception of company employed
drivers, contracted owner operators, or tractor and
trailer repair facilities, OTR shall not store or
otherwise release possession of any COLLATERAL to any
bailee or other person without PFC's prior written
consent.
4.3 No Cash Payments to Subsidiaries or Shareholders. OTR
shall not disburse any funds to any of its subsidiaries
or shareholders, including but not limited to, dividend,
loan or other transfer, for any reason whatsoever, until
all INDEBTEDNESS due PFC has been paid. The only
exception to the foregoing shall be payroll related
disbursements due in the ordinary course to current
employees who are also shareholders; and payments to
Steven W. Ruben for the sole purpose of retiring his
outstanding stock purchase loan, which has a principal
balance of $30,000 as of December 10, 2000.
4.4 Acquisitions. OTR shall not acquire through the
acquisition of stock or assets, any other entity,
partnership or business without first obtaining the
prior written consent of PFC.
4.5 Inspection. OTR shall, upon reasonable notice by PFC,
permit any representative of PFC to inspect any of the
collateral at any time.
4.6 Insurance. OTR shall maintain public liability,
property damage, product liability, and workers
compensation insurance and insurance on all of its
insurable property, including without limitation,
insurance covering the COLLATERAL, including RETURNED
EQUIPMENT, against all fire and other hazards and such
other insurance as is usually carried in similar
businesses and as may be required by PFC, for not less
than full replacement value, and as may be more
particularly described in the other LOAN DOCUMENTS. All
such insurance shall be in form and amount and issued by
companies satisfactory to PFC.
4.7 Notice of Certain Events. OTR shall promptly notify PFC
in writing of the occurrence of any change in the: (i)
location of OTR's executive headquarters; (ii) name or
trade name of OTR; or (iii) termination of employment or
resignation of Steven W. Ruben or William P. Ward from
OTR.
4.8 Encumberance. OTR shall not encumber, beyond the
existing first liens, property referenced in Section
3.1.4 of this AGREEMENT prior to CLOSING (as defined in
Section 6.0).
5.0 REPRESENTATIONS AND WARRANTIES. In addition to the
representations and warranties contained in the other LOAN
DOCUMENTS, and as a material inducement to PFC to enter into
this AGREEMENT and acknowledging that PFC would not enter into
this AGREEMENT but for its reliance upon the truth and
accuracy of the following (and the representations and
warranties contained in the other LOAN DOCUMENTS), OTR
represents and warrants that:
5.1 Authorization; Legally Enforceable Obligations. The
execution, delivery and performance of this AGREEMENT:
(i) is duly authorized by all parties hereto; (ii) is
not in contravention or conflict with any law or
regulation or any term or provision of OTR's articles of
incorporation or bylaws, and (iii) when delivered will
be the valid, binding and legally enforceable obligation
of OTR in accordance with its term and conditions.
5.2 Conflicting Agreements and Provisions. Neither the
execution nor delivery of the LOAN DOCUMENTS, nor the
fulfillment of nor compliance with the terms and
provisions thereof, will conflict with or result in a
breach of the term, conditions, provisions of,
constitute a default under, or result in any violation
of the provisions of any contract or agreement to which
OTR is a party or may be bound.
5.3 Solvency. After giving effect to the INDEBTEDNESS, OTR:
(i) does not intend to incur, nor believe they are
incurring, debts beyond their ability to pay as they
mature; and (ii) have no actual intent to hinder, delay,
or defraud either present or future creditors.
5.4 Compliance. OTR is in compliance, in all material
respects, with all laws, statutes, ordinances, judicial
or administrative orders, licenses, permits, and
governmental rules and regulations applicable to it,
including, without limitation, laws and regulations
relating to the environment, taxation and employment
practices.
5.5 Corporate Organization and Authority. OTR: (i) is a
corporation duly organized, validly existing and in good
standing under the laws of the State of Kansas; (ii) has
all requisite power and authority to own its property
and to carry on the business that it now conducts and as
is presently proposed to be conducted; and (iii) is
properly qualified and authorized to do business and is
in good standing as a foreign corporation in any
jurisdiction or territory where the ownership or
character of its property or the nature of its business
and activities make such qualification necessary and
where the failure to qualify would materially adversely
affect its business or financial condition.
5.6 Litigation. There are no actions, suits, investigations
or proceedings pending or, to OTR's knowledge,
threatened against OTR or any of its properties or
assets by or before any court, arbitrator or
governmental body, department, commission, board,
bureau, agency or other instrumentality for which there
may be claims or liabilities in excess of $25,000 or
which might result in any material change in the
business or financial condition of OTR, except as
disclosed. Also excepted, are those suits relating to
insurance claims, including accidents and workers'
compensation cases.
5.7 Taxes. OTR has, to the best of its knowledge, filed all
federal, state and local tax returns and other reports
required by law and they have paid, or made provision
for the payment of, all taxes, assessments, fees and
other governmental charges that are due and payable.
OTR believes that, to the best of its knowledge, the
provision for taxes on the books of OTR is adequate for
all years not closed by applicable statutes, and for the
current fiscal year.
5.8 Financial Statements; Financial Condition; Undisclosed
Liabilities. OTR's financial statements ("FINANCIAL
STATEMENTS") as previously presented to PFC, and as they
currently exist, present fairly in all material respects
the financial condition and operational results of OTR
at the date of the FINANCIAL STATEMENTS. The FINANCIAL
STATEMENTS have been prepared in accordance with
generally accepted accounting principles and practices.
Since October 1, 2000 there has been no material adverse
change in the business, operations, property, assets,
condition or prospects of OTR. Except as fully
reflected in the FINANCIAL STATEMENTS, there are no
liabilities or obligations with respect to OTR of any
material nature whatsoever, to the best of OTR's
knowledge.
6.0 CLOSING DATE. Subject to the terms and conditions set forth
herein, the closing of the transactions contemplated herein
(the "CLOSING") shall occur on or before December 29, 2000
(the "CLOSING DATE"). If the CLOSING shall not occur on or
before December 29, 2000, the INDEBTEDNESS shall be
immediately due and payable (without notice) and PFC shall be
entitled to exercise all of the rights and remedies provided
under the LOAN DOCUMENTS (including, without limitation, this
AGREEMENT) or otherwise.
7.0 RELEASE OF ALL CLAIMS.
7.1 OTR does hereby fully, completely, finally and forever
release, relinquish and discharge PFC and PFC's agents,
employees, attorneys, directors, officers, shareholders,
successors and assigns (collectively, the "RELEASEES")
of and from any and all claims, actions, causes of
action, demands, offsets, rights, debts, agreements,
promises, liabilities, damages, accountings, costs and
expenses, whether known or unknown, suspected or
unsuspected, of every kind and nature whatsoever which
OTR has or may have against the RELEASEES, arising
directly or indirectly out of any agreement,
transaction, fact, act or omission whatsoever, whether
known or unknown, howsoever and wheresoever occurring
prior to the CLOSING DATE relating to the INDEBTEDNESS,
such claims, actions, causes of action, demands,
offsets, rights, debts, agreements, promises,
liabilities, damages, accountings, costs and expenses
being hereinafter referred to as the "RELEASED CLAIMS."
7.2 It is the intention of the parties to this release that
this AGREEMENT shall be effective as a full and final
accord and satisfaction and release of each and every
RELEASED CLAIM.
7.3 OTR hereby acknowledges that it may hereafter discover
facts in addition to, or different from, those which it
now knows or believes to be true with respect to the
subject matter of this AGREEMENT and the RELEASED
CLAIMS, but that notwithstanding the foregoing, it is
their intention hereby to fully, finally, completely and
forever settle and release each, every and all RELEASED
CLAIMS, and that in furtherance of such intention, the
releases herein given shall be and remain in effect as
full and complete general releases, notwithstanding the
discovery or existence of any such additional or
different facts.
7.4 OTR hereby warrants and represents to the RELEASEES
that, as to any RELEASED CLAIM, each of them is the sole
and absolute owner thereof, free and clear of all of the
rights and interest of any other person therein and has
the right, ability and the sole power to release such
RELEASED CLAIM.
7.5 OTR acknowledges and confirms that it has been advised
by counsel with respect to the release contained herein.
OTR is executing this release voluntarily and with full
knowledge of its significance.
8.0 REVIVAL CLAUSE. If the incurring of any debt or the payments
of money or transfers of property made to PFC by or on behalf
of OTR should for any reason subsequently be declared to be
"fraudulent" or a "preference" within the meaning of any state
or federal law relating to creditor's rights, including,
without limitation, fraudulent conveyances, preferences or
other voidable or recoverable payments of money or transfers
of property, in whole or in part, for any reason
(collectively, "VOIDABLE TRANSFERS") under the Bankruptcy Code
or any other federal or state law and PFC is required to repay
or restore any such VOIDABLE TRANSFER or the amount or any
portion thereof, or upon the advice of its counsel is advised
to do so, then, as to any such VOIDABLE TRANSFER or the amount
repaid or restored (including all reasonable costs, expenses
and attorneys' fees of PFC related thereto), the liability of
OTR shall automatically be revived, reinstated and restored
and shall exist as though such VOIDABLE TRANSFER had never
been made.
9.0 CONDITIONS PRECEDENT TO PFC'S OBLIGATIONS. The obligation of
PFC to consummate the transactions contemplated herein on the
CLOSING DATE shall be subject to: (i) the accuracy of the
representations and warranties set forth in the LOAN
DOCUMENTS; and (ii) the satisfaction of the following (all in
form and substance acceptable to PFC in PFC's sole discretion)
on or before the CLOSING DATE:
9.1 Each of the following documents and instruments (which
are for the sole benefit of PFC) shall be delivered to
PFC, unless waived by PFC in writing:
9.1.1 Duly executed originals of the LOAN DOCUMENTS,
and any other documents contemplated herein,
including but not limited to those described on
Exhibit C attached hereto; and
9.1.2 Certified copies of all actions taken by OTR
authorizing: (i) the execution and delivery of
the LOAN DOCUMENTS; and (ii) implementation and
performance of the transactions contemplated by
the LOAN DOCUMENTS; and
9.1.3 A certificate of the Chief Financial Officer of
OTR, in the form of Exhibit "D" attached
hereto; and
9.1.4 Such other instruments and documents as PFC may
reasonably request in order to fully effectuate
the purpose of the LOAN DOCUMENTS, in form and
substance satisfactory to PFC.
9.2 OTR shall pay PFC a loan fee of $25,000, which shall be
added to the loan balance as fully earned, and will be
due and payable on April 1, 2002.
9.3 OTR shall reimburse PFC for all of PFC's costs and
expenses (including reasonable attorneys' fees and
expenses) incurred in connection with the preparation,
negotiation and closing of the transactions contemplated
by the LOAN DOCUMENTS.
10.0 POST-CLOSING OBLIGATIONS. Within ten (10) days following
the CLOSING DATE, OTR covenants that they will deliver to PFC
the following items (in form and substance satisfactory to PFC in
PFC's sole discretion), the failure of which shall constitute a
material breach hereof:
10.1 Duly executed real estate mortgage pledged as
additional security in Section 3.1.4. All taxes, fees
and closing costs associated with the lien on real
estate shall be paid by OTR;
11.0 DEFAULT. The following shall constitute an "EVENT OF
DEFAULT" hereunder and under any other agreements now existing
or hereafter created between PFC and OTR:
11.1 Failure by OTR to make any payment when due to PFC
under the LOAN DOCUMENTS;
11.2 Failure by OTR to comply with or perform any of the
other terms, covenants or conditions of the LOAN
DOCUMENTS or any other agreements evidencing the
INDEBTEDNESS (including, but not limited to, any default
or EVENT OF DEFAULT under the LOAN DOCUMENTS); provided,
however, that any defaults existing as of the date of
this AGREEMENT under the EXISTING DOCUMENTS shall not be
an EVENT OF DEFAULT under this AGREEMENT unless and
until another EVENT OF DEFAULT occurs;
11.3 Any representation, warranty or other statement is
false or misleading in any respect when made or
furnished or which subsequently becomes false or
misleading in any material respect;
11.4 A default or EVENT OF DEFAULT under, or breach of,
any existing or future agreement with PFC or any third
party to which OTR is a party, or to which OTR may be
bound;
11.5 OTR at any time becomes insolvent;
11.6 The dissolution or termination of existence,
cessation of business, appointment of a receiver,
trustee, custodian, administrator or similar fiduciary,
assignment for the benefit of creditors or the
commencement of a case under any chapter of the
Bankruptcy Code, by or against OTR.
11.7 Any money judgment or judgments, excluding those
arising from workers' compensation claims, in the
aggregate sum of $50,000 (in excess of amounts covered
by insurance) shall be rendered against OTR or any of
its assets;
11.8 PFC reasonably deems the COLLATERAL in danger of
misuse, confiscation, damage or destruction.
12.0 RIGHTS AND REMEDIES OF PFC UPON DEFAULT. If any EVENT OF
DEFAULT shall occur, and is continuing, in addition to any
other remedy contained in the other LOAN DOCUMENTS or
otherwise provided by law, PFC may at its sole option and
without demand to OTR, which notice is hereby expressly
waived, do any one or more of the following:
12.1 Accelerate and declare immediately due and payable
all remaining balance(s) of the INDEBTEDNESS due PFC.
12.2 Notify any or all of OTR's buyers or transferees of
the COLLATERAL or other persons of PFC's interest in the
COLLATERAL and the proceeds thereof and instruct such
person(s) to thereafter make any payment due OTR
directly to PFC.
12.3 OTR hereby irrevocably constitutes and appoints PFC
as its attorney-in-fact to: (i) endorse OTR's name on
any notes, acceptances, checks, drafts, money orders or
other evidence of payment that may come into PFC's
possession; (ii) sign OTR's name on any invoice or bill
of lading relating to any of the COLLATERAL and(iii)
demand, receive and enforce payment and give receipts,
releases and satisfactions for and sue for all money
payable to OTR. All of the preceding may be done either
in the name of PFC or in the name of OTR with the same
force and effect as OTR could have, had this AGREEMENT
not been made;
12.4 Enforce any security interest or lien given or
provided for under this AGREEMENT or any other document
relating to the COLLATERAL, in such manner and such
order, as to all or any part of the COLLATERAL, as PFC,
in its sole judgment, deems to be necessary or
appropriate; and OTR hereby waives any and all rights,
obligations or defenses now or hereafter established by
law relating to the foregoing. In the enforcement of
its security interest in the COLLATERAL, PFC is
authorized to enter upon the premises where any
COLLATERAL is located and take possession of the
COLLATERAL or any part thereof, together with OTR's
records pertaining thereto and PFC may sell the
COLLATERAL or any portions thereof, together with all
additions, accessions and accessories thereto, giving
only such notices and following only such procedures as
are required by law, at either public or private sale,
or both, with or without having the COLLATERAL present
at the time of sale, which sale shall be on such terms
and conditions and conducted in such manner as PFC
determines in its sole judgment to be commercially
reasonable. Any deficiency arising from an EVENT OF
DEFAULT which exists after disposition or liquidation of
the COLLATERAL shall be a continuing liability of OTR
and shall be immediately payable to PFC.
12.5 Exercise any and all legal or equitable remedies
afforded to PFC as provided in the other LOAN DOCUMENTS,
any agreement or other documents heretofore or hereafter
entered into between PFC and OTR, or as provided for
under the Uniform Commercial Code or any other
applicable law;
12.6 Require OTR, at their sole cost and expense, to
assemble the COLLATERAL and records pertaining to the
COLLATERAL and make them available to PFC at a place
designated by PFC; and/or
12.7 The rights and remedies granted to PFC in this
Section 12 are cumulative, and PFC shall have the right
to exercise any one or more of such rights and remedies
alternatively, successively or concurrently as PFC may,
in its sole and absolute discretion, deem advisable.
13.0 ATTORNEYS' FEES AND EXPENSES. OTR shall be responsible for
payment of all reasonable attorneys' fees and out-of-pocket
expenses incurred by PFC in negotiating, preparing and
documenting the transactions contemplated herein, and all
costs and expenses with respect thereto and shall promptly pay
same prior to or at the CLOSING. Whether or not litigation is
necessary to enforce any of the provisions of this AGREEMENT
(including, without limitation, the securing of any relief
from any provision of the Bankruptcy Code or incurred in any
manner in connection with a bankruptcy proceeding of OTR), the
prevailing party shall receive from the non-prevailing
party(ies) all reasonable costs, expenses and attorneys' fees
incurred in connection with pursuing any rights under the LOAN
DOCUMENTS, including, without limitation, attorneys' fees
incurred in connection with: (i) relief from stay and similar
proceedings; (ii) any appeals; (iii) the enforcement of any
judgment; and
(iv) the appointment of any receiver pursuant to default, as
defined in Section 11.
14.0 INTEGRATION. This AGREEMENT, and all documents and
exhibits referred to herein and/or attached hereto, including,
without limitation, the other LOAN DOCUMENTS, shall constitute
the complete agreement of the parties hereto with respect to
the subject matters referred to herein and supersede all prior
or contemporaneous negotiations, promises, covenants,
agreements or representations of every kind or nature
whatsoever with respect thereto, all of which have become
merged and finally integrated into this AGREEMENT. OTR is not
relying upon any representation or communication made by, or
on behalf of, PFC other than the written covenants setforth in
this AGREEMENT. Each of the parties understands that in the
event of any subsequent litigation, controversy or dispute
concerning any of the terms, conditions or provisions of this
AGREEMENT, neither party shall be permitted to offer or
introduce any oral evidence concerning any other oral promises
or oral agreements between the parties relating to the subject
matters of this AGREEMENT not included or referred to herein
and not reflected by a writing. This AGREEMENT cannot be
amended, modified, or supplemented except by a written
document signed by all parties hereto. In the case of
conflict between the provisions of this AGREEMENT and the
other LOAN DOCUMENTS, the provisions of this AGREEMENT shall
control.
15.0 ADDITIONAL ASSURANCES. OTR agrees that it will execute
such other documents and instruments and perform such other
acts as may reasonably be required by PFC, in PFC's sole and
absolute discretion, to carry out and effectuate the purpose
and intent of this AGREEMENT.
16.0 FORM AND CONTENT OF DOCUMENTS. All documents referred to
herein shall be in such form and substance as shall be
satisfactory to PFC and its counsel in their sole and absolute
discretion.
17.0 WAIVER OF FORBEARANCE. PFC's waiver or forbearance of any
existing or future default by OTR of any of the terms and/or
conditions of the LOAN DOCUMENTS, or the acceptance of any
late payments, shall not be deemed a waiver or forbearance of
any such future default. No waiver or forbearance of any of
the provisions of LOAN DOCUMENTS shall be deemed, or shall
constitute, a waiver or forbearance of any other provisions
thereof, and no waiver or forbearance of any type shall be
binding unless evidenced by a writing signed by PFC.
18.0 MISCELLANEOUS.
18.1 Gender and Person. Whenever the context of this
AGREEMENT so requires, the neuter shall include the
masculine and the feminine; the masculine shall include
the neuter and the feminine; the feminine shall include
the neuter and the masculine; the singular shall include
the plural; and the plural shall include the singular.
18.2 Notices. Except as provided by law and this
AGREEMENT, OTR hereby waives all notice and demand
requirements. Any required notices, requests and
demands, shall be in writing and shall be deemed to have
been duly given upon the date of such service if served
personally upon the party for whom intended, or if
mailed, by first class, registered or certified mail,
return receipt requested, postage prepaid, upon three
(3) days after the date of such mailing, to such party
at its address as shown below or otherwise hereafter
designated by such party in writing:
If to PFC: PACCAR Financial Corp.
777 106th Avenue NE
Bellevue, WA 98004
Attn: Dallas J. Becker
If to OTR: OTR Express, Inc.
804 N. Meadowbrook Drive
Olathe, KS 66063-0819
Attn: William P. Ward
18.3 Section and Paragraph Headings. The headings
preceding each of the above sections and paragraphs are
for convenience only and shall not be considered in the
construction or interpretation of this AGREEMENT.
18.4 Time of Essence. Time is of the essence in the
performance of this AGREEMENT.
18.5 No Assignment; Binding Effect. This AGREEMENT may be
assigned by PFC in whole or in part in its sole and
absolute discretion. This AGREEMENT is personal to OTR
and shall not be assigned thereby to any other person or
entity and any such assignment shall be in violation
hereof and null and void. Notwithstanding the above,
this AGREEMENT shall be binding upon and shall inure to
the benefit of the respective parties hereto and their
respective heirs, estates and successors, and the
assigns of PFC.
18.6 Recitals Incorporated. The Recitals are incorporated
into and are a part of this AGREEMENT.
18.7 Exhibits Incorporated. All exhibits attached hereto
are incorporated into and are a part of this AGREEMENT.
18.8 Survival of Representations. All representations and
warranties set forth herein shall survive the execution
of this AGREEMENT and shall be in full force and effect
until the INDEBTEDNESS has been repaid in full.
18.9 Governing Law. This AGREEMENT shall be governed by
and construed in accordance with the laws of the State
of Kansas.
18.10 Severability. If any provision of the LOAN DOCUMENTS
shall be held invalid, illegal or otherwise
unenforceable, such provision shall be severable from
the remainder of such agreement, instrument or document
and the validity, legality and enforceability of the
remaining provisions shall not be adversely affected or
impaired thereby and shall remain in full force and
effect.
18.11 Counterparts. This AGREEMENT may be executed in one
or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute but
one and the same instrument. A facsimile signature on
this AGREEMENT or any document required under this
AGREEMENT, shall be a valid signature for the purpose of
the implementation and execution of this AGREEMENT.
18.12 Construction. The parties agree that each party and
its counsel have reviewed and revised the LOAN DOCUMENTS
and that any rule of construction to the effect that
ambiguities are to be resolved against the drafting
party shall not apply in the interpretation of the LOAN
DOCUMENTS or any amendment thereto or exhibits therein.
18.13 Venue; Jurisdiction; Jury Trial Waiver. PFC and OTR
hereby:
(i) Consent to the jurisdiction of any State
or Federal Court located in the State of
Washington or the State of Kansas;
(ii) Irrevocably waive their right to a jury
trial in any action or proceeding based
upon, or related to, the subject matter
of the LOAN DOCUMENTS or the
INDEBTEDNESS. The foregoing waiver of
trial by jury is knowingly,
intentionally, and voluntarily made by
OTR and PFC. Each acknowledges that
neither PFC nor any person acting on
behalf of PFC has made any
representations of fact to induce this
waiver of trial by jury or in any way to
modify or nullify its effect. OTR
further acknowledges that it has been
represented (or has had the opportunity
to be represented) in the signing of this
AGREEMENT and in the making of this
waiver by independent legal counsel,
selected of its own free will, and that
they have had the opportunity to discuss
this waiver with counsel. OTR further
acknowledges that it has read and
understands the meaning and ramification
of this provision.
IN WITNESS WHEREOF, this AGREEMENT is executed as of the day and
year first written above.
PFC:
PACCAR Financial Corp.
By : /s/ Dallas Becker
Print Name: Dallas Becker
Title : Corporate Portfolio Manager
OTR:
OTR Express, Inc.
By: /s/ William P. Ward
Print Name: William P. Ward
Title: President
EXHIBIT C
NEW LOAN DOCUMENTS
In addition to this AGREEMENT, the NEW LOAN DOCUMENTS shall consist of
the following:
Duly executed real estate mortgage granting a security interest in the
OTR real estate as provided for in 3.1.4 of the Credit
Restructure Agreement
EXHIBIT D
CERTIFICATE OF CHIEF FINANCIAL OFFICER
OF OTR EXPRESS, INC.
I, Steven W. Ruben, Chief Financial Officer of OTR, DO HEREBY CERTIFY
as follows:
1. OTR has performed and observed each and every
covenant contained in the AGREEMENT dated as of
October 1, 2000, by and among OTR and PFC.
2. No EVENT OF DEFAULT has occurred and no condition
exists which constitutes an EVENT OF DEFAULT under
the AGREEMENT or would constitute such an EVENT OF
DEFAULT upon the giving of notice, the lapse of any
applicable cure period, or both, as specified in the
AGREEMENT.
3. For purposes of this certificate, all terms not
otherwise defined herein shall have the meanings
ascribed thereto in the AGREEMENT.
IN WITNESS WHEREOF, I have executed this certificate as of the th
day of , 2000.
/s/ Steven W. Ruben
Steven W. Ruben
Chief Financial Officer