Exhibit 10.4
MASTER LEASE AGREEMENT
Lessor: TRANSAMERICA BUSINESS CREDIT CORPORATION
RIVERWAY II
WEST OFFICE TOWER
9399 WEST HIGGINS ROAD
ROSEMONT, ILLINOIS 60018
Lessee: Ameritruck Distribution Corp. and Co-Lessees as identified in
paragraph 36
301 Commerce, Suite 1101
Fort Worth Texas 76102
The lessor pursuant to this Master Lease Agreement ("Agreement") is Transamerica
Business Credit Corporation ("Lessor"). All equipment, together with all
present and future additions, parts, accessories, attachments, substitutions,
repairs, improvements and replacements thereof or thereto, which are the subject
of a Lease (as defined in the next sentence) shall be referred to as
"Equipment"; provided, however, mobile communications and satellite tracking
systems installed shall not become part of the Equipment unless specifically
provided otherwise on a "Schedule" (as defined below). Simultaneous with the
execution and delivery of this Agreement, the parties are entering into one or
more Lease Schedules (each, a "Schedule") which refer to and incorporate by
reference this Agreement, each of which constitutes a lease (each, together with
all addendums, riders, schedules, and exhibits thereto, a "Lease") for the
Equipment specified therein. Additional details pertaining to each Lease are
specified in the applicable Schedule. Each Schedule that the parties hereafter
enter into shall constitute a Lease. Lessor has no obligation to enter into any
additional leases with, or extend any future financing to, Lessee.
1. LEASE. Subject to and upon all of the terms and conditions of this
Agreement and each Schedule, Lessor hereby agrees to lease to Lessee and Lessee
hereby agrees to lease from Lessor the Equipment for the Term (as defined in
Paragraph 2 below) thereof.
2. TERM. Each Lease shall be effective and the term of each Lease
("Term") shall commence on the date of execution of the applicable Schedule and,
unless sooner terminated (as hereinafter provided), shall expire on the Purchase
Date specified in each Schedule; provided, however, that obligations due to be
performed by the Lessee during the Term shall continue until they have been
performed in full.
3. RENT. Lessee shall pay as rent to Lessor, for use of the Equipment
during the Term, rental payments equal to the sum of all rental payments
including, without limitation, security deposits, and interim rents payable in
the amounts and on the dates specified in the applicable Schedule ("Rent'). If
any Rent or other amount payable by Lessee is not paid within ten days after the
day on which it becomes payable, Lessee will pay on demand, as a late charge, an
amount equal to 5% of such unpaid Rent or other amount but only to the extent
permitted by applicable law. All payments provided for herein shall be payable
to Lessor at its address specified above, or at any other place designated by
Lessor.
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4. LEASE NOT CANCELABLE; LESSEE'S OBLIGATIONS ABSOLUTE. No Lease may be
canceled or terminated except as expressly provided herein. Lessee's obligation
to pay all Rent due or to become due hereunder shall be absolute and
unconditional and shall not be subject to any delay, reduction, set-off,
defense, counterclaim or recoupment for any reason whatsoever, including any
failure of the Equipment or any representations by the manufacturer or the
vendor thereof. If the Equipment is unsatisfactory for any reason, Lessee shall
make any claim solely against the manufacturer or the vendor thereof and shall,
nevertheless, pay Lessor all Rent payable hereunder.
5. SELECTION AND USE OF EQUIPMENT. Lessee agrees that it shall be
responsible for the selection, use of, and results obtained from, the Equipment
and any other associated equipment or services.
6. WARRANTIES. LESSOR MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR
IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING, WITHOUT LIMITATION, THE DESIGN
OR CONDITION OF THE EQUIPMENT OR ITS MERCHANTABILITY, SUITABILITY, QUALITY OR
FITNESS FOR A PARTICULAR PURPOSE, AND HEREBY DISCLAIMS ANY SUCH WARRANTY.
LESSEE SPECIFICALLY WAIVES ALL RIGHTS TO MAKE A CLAIM AGAINST LESSOR FOR BREACH
OF ANY WARRANTY WHATSOEVER. LESSEE LEASES THE EQUIPMENT "AS IS." IN NO EVENT
SHALL LESSOR HAVE ANY LIABILITY FOR, NOR SHALL LESSEE HAVE ANY REMEDY AGAINST
LESSOR FOR, ANY LIABILITY, CLAIM, LOSS, DAMAGE OR EXPENSE CAUSED DIRECTLY OR
INDIRECTLY BY THE EQUIPMENT OR ANY DEFICIENCY OR DEFECT THEREOF OR THE
OPERATION, MAINTENANCE OR REPAIR THEREOF OR ANY CONSEQUENTIAL DAMAGES AS THAT
TERM IS USED IN SECTION 2-719(3) OF THE MODEL UNIFORM COMMERCIAL CODE OR SIMILAR
STATUTE ("UCC"). Lessor grants to Lessee, for the sole purpose of prosecuting a
claim, the benefits of any and all warranties made available by the manufacturer
or the vendor of the Equipment to the extent assignable.
7. DELIVERY. Lessor hereby appoints Lessee as Lessor's agent for the sole
and limited purpose of accepting delivery of the Equipment from each vendor
thereof. Lessee shall pay any and all delivery and installation charges.
Lessor shall not be liable to Lessee for any delay in, or failure of, delivery
of the Equipment.
8. RENEWAL. So long as no Event of Default or event which, with the
giving of notice, the passage of time, or both, would constitute an Event of
Default, shall have occurred and be continuing, Lessee may renew a Lease on the
terms and conditions agreed upon by Lessee and Lessor. Lessee shall request a
renewal in writing to Lessor not less than one hundred eighty days prior to the
expiration of the applicable Lease. The Rent shall be determined by Lessor by
using the projected fair market value of the Equipment on an "In-place, In-use"
basis as of the commencement of such renewal term.
9. PURCHASE OPTION. So long as no Event of Default or event which, with
the giving of notice, the passage of time, or both, would constitute an Event of
Default, shall have occurred and be continuing, Lessee may, upon written notice
to Lessor received at lease one hundred eighty days before the expiration of a
Term, purchase all the Equipment covered by the applicable Lease on the date
specified therefor in the applicable Schedule ("Purchase Date"). The purchase
price
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for such Equipment (the "Purchase Price"), shall be its fair market value on an
"In-place, In use" basis, as mutually agreed by Lessor and Lessee, or, if they
cannot agree, as determined by an independent appraiser selected by Lessor and
approved by Lessee, which approval will not be unreasonably delayed or withheld.
Lessee shall pay the cost of any such appraisal. On the Purchase Date for any
Equipment, Lessee shall pay to Lessor the Purchase Price, together with all
sales and other taxes applicable to the transfer of the Equipment and any other
amount payable and arising hereunder, in immediately available funds, whereupon
Lessor shall transfer to Lessee, without recourse or warranty of any kind,
express or implied, all of Lessor's right, title and interest in and to such
Equipment on an "As Is, Where Is" basis.
10. OWNERSHIP; INSPECTION; MARKING; FINANCING STATEMENTS. Lessee shall
affix to the Equipment any labels supplied by Lessor indicating ownership of
such Equipment. The Equipment is and shall be the sole property of Lessor.
Lessee shall have no right, title or interest therein, except as lessee under a
Lease. The Equipment is and shall at all times be and remain personal property
and shall not become a fixture. Lessee shall obtain and record such instruments
and take such steps as may be necessary to prevent any Person from acquiring any
rights in the Equipment by reason of the Equipment being claimed or deemed to be
real property. Upon request by Lessor, Lessee shall obtain and deliver to
Lessor valid and effective waivers, in recordable form, by the owners, landlords
and mortgagees of the real property upon which the Equipment is located or
certificates of Lessee that it is the owner of such real property or that such
real property is neither leased nor mortgaged. Lessee shall make the Equipment
and its maintenance records available for inspection by Lessor at reasonable
times and upon reasonable notice. Lessee shall execute and deliver to Lessor
for filing any UCC financing statements or similar documents Lessor may request.
11. EQUIPMENT USE. Lessee agrees that the Equipment will be operated by
competent, qualified personnel in connection with Lessee's business for the
purpose for which the Equipment was designed and in accordance with applicable
operating instructions, laws and government regulations, and that Lessee shall
use every reasonable precaution to prevent loss or damage to the Equipment from
fire and other hazards. Lessee shall procure and maintain in effect all orders,
licenses, certificates, permits, approvals and consents required by federal,
state or local laws or by any governmental body, agency or authority in
connection with the delivery, installation, use and operation of the Equipment,
the absence of which, individually, or in total, would not have a material
adverse effect upon the business of Lessee.
12. MAINTENANCE. Lessee, at its sole cost and expense, shall keep the
Equipment in a suitable environment as specified by the manufacturer's
guidelines or the equivalent and meet all recertification requirements, and
shall maintain the Equipment in its original condition and working order,
ordinary wear and tear excepted. At the request of Lessor, Lessee shall furnish
all proof of maintenance.
13. ALTERATION; MODIFICATIONS; PARTS. Lessee may alter or modify the
Equipment only with the prior written consent of Lessor. Any alteration shall
be removed and the Equipment restored to its normal, unaltered condition at
Lessee's expense (without damaging the Equipment's originally intended function
or its value) prior to its return to Lessor. Any part installed in connection
with warranty or maintenance service or which cannot be removed in accordance
with the preceding sentence shall be the property of Lessor.
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14. RETURN OF EQUIPMENT. Except for Equipment that has suffered a
Casualty Loss (as defined in Paragraph 15 below) and is not required to be
repaired pursuant to Paragraph 15 below or Equipment for which the Lease has
been renewed pursuant to Paragraph 8 above or purchased by Lessee pursuant to
Paragraph 9 above, upon expiration or termination of the Term of a Lease, or
upon demand by Lessor pursuant to Paragraph 22 below, Lessee shall contact
Lessor for shipping instructions and, at Lessees own risk, immediately return
the Equipment, freight prepaid, to a location in the continental United States
specified by Lessor. At the time of such return to Lessor, the Equipment shall
(i) be in the operating order, repair and condition as required by or specified
in the original specifications and warranties of each manufacturer and vendor
thereof, ordinary wear and tear excepted, and meet all recertification
requirements and (ii) be capable of being immediately assembled and operated by
a third party purchaser or third party lessee without further repair,
replacement, alterations or improvements, and in accordance and compliance with
any and all statutes, laws, ordinances, rules and regulations of any
governmental authority or any political subdivision thereof applicable to the
use and operation of the Equipment. Except as otherwise provided under Paragraph
8 or 9 hereof, at least one hundred eighty days before the expiration of any
Term, Lessee shall give Lessor notice of its intent to return the Equipment at
the end of such Term. During such one hundred eighty-day period, Lessor and its
prospective purchasers or lessees shall have the right of reasonable access to
the premises on which the Equipment is located to inspect the Equipment, and
Lessee shall cooperate in all other reasonable respects with Lessor's
remarketing of the Equipment; provided, however, that nothing herein shall
require Lessee to unreasonably interrupt or delay any shipments in transit or to
incur any unreasonable empty miles in connection with any such inspection or to
unreasonably disrupt Lessee's business. The provisions of this Paragraph 14 are
of the essence of the Lease, and upon application to any court of equity having
jurisdiction in the premises, Lessor shall be entitled to a decree against
Lessee requiring specific performance of the covenants of Lessee set forth in
this Paragraph 14. If Lessee fails to return Equipment when required, the terms
and conditions of the Lease shall continue to be applicable and Lessee shall
continue to pay Rent until the Equipment is received by Lessor.
15. CASUALTY INSURANCE; LOSS OR DAMAGE. Lessee will maintain, at its own
expense, liability and property damage insurance relating to the Equipment,
insuring against such risks as are customarily insured against on the type of
equipment leased hereunder by businesses in which Lessee is engaged in such
amounts, in such form, and with insurers satisfactory to Lessor; provided,
however, that the amount of insurance against damage or loss shall not be less
than the greater of (a) the replacement value of the Equipment and (b) the
stipulated loss value of the Equipment specified in the applicable Schedule
("Stipulated Loss Value"); further provided, however, that Lessee shall have the
right to self-insure the Equipment against loss or damage (but not liability
insurance). Each liability insurance policy shall provide coverage (including
contractual and personal injury coverage) of not less than $1,000,000 or the
amount required by law, whichever is greater for each occurrence, name Lessor as
an additional insured and be primary as respects of any other insurance. If
Lessee fails to insure the Equipment as required, Lessor shall have the right
but not the obligation to obtain such insurance, and the cost of the insurance
shall be for the account of Lessee due as part of the next due Rent. Lessee
consents to Lessor's release, upon its failure to obtain appropriate insurance
coverage, of any and all information necessary to obtain insurance with respect
to the Equipment or Lessor's interest therein.
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Until the Equipment is returned to and received by Lessor as provided in
Paragraph 14 above, Lessee shall bear the entire risk of theft or destruction
of, or damage to, the Equipment including, without limitation, any condemnation,
seizure or requisition of title or use ("Casualty Loss"). No Casualty Loss
shall relieve Lessee from its obligations to pay Rent except as provided in
clause (b) below. When any Casualty Loss occurs, Lessee shall immediately
notify Lessor and, at the option of Lessor, shall promptly (a) place such
Equipment in good repair and working order; or (b) pay Lessor an amount equal to
the Stipulated Loss Value of such Equipment and all other amounts (excluding
Rent) payable by Lessee hereunder, together with a late charge on such amounts
at a rate per annum equal to the rate imputed in the Rent payments hereunder (as
reasonably determined by Lessor) from the date of the Casualty Loss through the
date of payment of such amounts, whereupon Lessor shall transfer to Lessee,
without recourse or warranty (express or implied), all of Lessor's interest, if
any, in and to such Equipment on an "AS IS, WHERE IS" basis.
16. TAXES. Lessee shall pay when due, and indemnify and hold Lessor
harmless from, all sales, use, excise and other taxes, charges, and fees
(including, without limitation, income, franchise, business and occupation,
gross receipts, sales, use, licensing, registration, titling, personal property,
stamp and interest equalization taxes, levies, imposts, duties, charges or
withholdings of any nature), and any fines, penalties or interest thereon,
imposed or levied by any governmental body, agency or tax authority upon or in
connection with the Equipment, its purchase, ownership, delivery, leasing,
possession, use or relocation of the Equipment or otherwise in connection with
the transactions contemplated by each Lease or the Rent thereunder, excluding
taxes on or measured by the net income of Lessor. Upon request, Lessee will
provide proof of payment. Unless Lessor elects otherwise, Lessor will pay all
property taxes on the Equipment for which Lessee shall reimburse Lessor promptly
upon request. Lessee shall timely prepare and file all reports and returns
which are required to be made with respect to any obligation of Lessee under
this Paragraph 16. Lessee shall, to the extent permitted by law, cause all
billings of such fees, taxes, levies, imposts, duties, withholdings and
governmental charges to be made to Lessor in care of Lessee. Upon request,
Lessee will provide Lessor with copies of all such billings.
17. LESSOR'S PAYMENT. If Lessee fails to perform its obligations under
Paragraph 15 or 16 above, or Paragraph 23 below, Lessor shall have the right to
substitute performance, in which case, Lessee shall immediately reimburse Lessor
therefor.
18. GENERAL INDEMNITY. Each Lease is a net lease. Therefore, Lessee
shall indemnify Lessor and its successors and assigns against, and hold Lessor
and its successors and assigns harmless from, any and all claims, actions,
damages, obligations, liabilities and all costs and expenses, including, without
limitation, legal fees, incurred by Lessor or its successors and assigns arising
out of each Lease including, without limitation, the purchase, ownership,
delivery, lease, possession, maintenance, condition, use or return of the
Equipment, or arising by operation of law. Lessee agrees that upon written
notice by Lessor of the assertion of any claim, action, damage, obligation,
liability or lien, Lessee shall assume full responsibility for the defense
thereof. Any payment pursuant to this Paragraph (except for any payment of
Rent) shall be of such amount as shall be necessary so that, after payment of
any taxes required to be paid thereon by Lessor, including taxes on or measured
by the net income of Lessor, the balance will equal the amount due hereunder.
The provisions of this Paragraph with regard to matters arising during a Lease
shall survive the expiration or termination of such Lease.
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19. ASSIGNMENT OF LESSEE. Lessee shall not, without the prior written
consent of Lessor, (a) assign, transfer, pledge or otherwise dispose of any
Lease or Equipment, or any interest therein; (b) sublease or lend any Equipment
or permit it to be used by anyone other than Lessee and its employees or its
wholly-owned operating subsidiaries and their employees and independent
contractors; or (c) move any Equipment from the location specified for it in the
applicable Schedule, except that Lessee may move Equipment to another location
within the United States provided that Lessee has delivered to Lessor (A) prior
written notice thereof and (B) duly executed financing statements and other
agreements and instruments (all in form and substance satisfactory to Lessor)
necessary or, in the opinion of the Lessor, desirable to protect Lessor's
interest in such Equipment. Notwithstanding anything to the contrary in the
immediately preceding sentence, Lessee may keep any Equipment consisting of
motor vehicles or rolling stock at any location in the United States and may
utilize the Equipment in its regular business to and from points in Canada.
20. ASSIGNMENT BY LESSOR. Lessor may assign its interest or grant a
security interest in any Lease and the Equipment individually or together, in
whole or in part. If Lessee is given written notice of any such assignment, it
shall immediately make all payments of Rent and other amounts hereunder directly
to such assignee. Each such assignee shall have all of the rights of Lessor
under each Lease assigned to it. Lessee shall not assert against any such
assignee any set-off, defense or counterclaim that Lessee may have against
Lessor or any other person.
21. DEFAULT; NO WAIVER. Lessee or any guarantor of any or all of the
obligations of Lessee hereunder (together with Lessee, the "Lease Parties")
shall be in default under each Lease upon the occurrence of any of the following
events (each, an "Event of Default"): (a) Lessee fails to pay when due any
amount required to be paid by Lessee under or in connection with any Lease; (b)
any of the Lease Parties fails to perform any other provisions under or in
connection with a Lease or violates any of the covenants or agreements of such
Lease Party under or in connection with a Lease; (c) any representation made or
financial information delivered or furnished by any of the Lease Parties under
or in connection with a Lease shall prove to have been inaccurate in any
material respect when made; (d) any of the Lease Parties makes an assignment for
the benefit of creditors, whether voluntary or involuntary, or consents to the
appointment of a trustee or receiver, or if either shall be appointed for any of
the Lease Parties or for a substantial part of its property without its consent
and, in the case of any such involuntary proceeding, such proceeding remains
undismissed or unstayed for forty-five days following the commencement thereof;
(e) any petition or proceeding is filed by or against any of the Lease Parties
under any Federal or State bankruptcy or insolvency code or similar law and, in
the case of any such involuntary petition or proceeding, such petition or
proceeding remains undismissed or unstayed for forty-five days following the
filing or commencement thereof, or any of the Lease Parties takes any action
authorizing any such petition or proceeding; (f) any of the Lease Parties fails
to pay when due any indebtedness in excess of $1,000,000 for borrowed money or
under conditional sales or installment sales contracts or similar agreements,
leases or obligations evidenced by bonds, debentures, notes or other similar
agreements or instruments to any creditor (including Lessor under any other
agreement) after any and all applicable cure periods therefor shall have
elapsed; (g) any judgment over $1,000,000 shall be rendered against any of the
Lease Parties which shall remain unpaid or unstayed for a period of sixty days;
(h) any of the Lease Parties shall dissolve, liquidate, wind up or cease its
business, sell or otherwise dispose of all or substantially all of its assets,
make any material change in its capital structure or lines of business, amend or
modify
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its name, merge or consolidate with any other entity other than one of the Lease
Parties, suffer any loss or suspension of any material license, permit or other
right or asset necessary to the profitable conduct of its business, fail to pay
its debts as they mature, or call a meeting for purposes of compromising its
debts; (i) any of the Lease Parties shall deny or disaffirm its obligations
hereunder or under any of the documents delivered in connection herewith; (j)
there has been a change in control, as defined in the Indenture Agreement dated
November 15, 1995 among Ameritruck Distribution Corp. and the Guarantors Party
named therein and The Bank of New York, as Trustee; or (k) that the capital
stock of the Lease Parties becomes subject to any judicial or statutory lien not
discharged within (60) days, or becomes subject to any lien, security interest
or encumbrance, except in connection with a pledge of stock to FINOVA Capital
Corporation as security for a line-of-credit facility or any replacement
thereof. After receipt of notice of default from Lessor, Lessee will have (15)
days to cure any default other than the default for Lessee failing to pay when
due any amount required to be paid by Lessee under or in connection with any
Lease.
22. REMEDIES. Upon the occurrence and continuation of an Event of
Default, Lessor shall have the right, in its sole discretion, to exercise any
one or more of the following remedies: (a) terminate each Lease; (b) declare
any and all Rent and other amounts then due and any and all Rent and other
amounts to become due under each Lease immediately due and payable; (c) take
possession of any or all items of Equipment, wherever located, without demand,
notice, court order or other process of law, and without liability for entry to
Lessee's premises, for damage to Lessee's property or otherwise; (d) demand that
Lessee return any or all Equipment to Lessor in accordance with Paragraph 14
above, and, for each day that Lessee shall fail to return any item of Equipment,
Lessor may demand an amount equal to the Rent payable for such Equipment in
accordance with Paragraph 14 above; (e) lease, sell or otherwise dispose of the
Equipment in a commercially reasonable manner, with or without notice and on
public or private bid; (f) recover the following amounts from the Lessee (as
damages, including reimbursement of costs and expenses, liquidated for all
purposes and not as a penalty): (i) all costs and expenses of Lessor
reimbursable to it hereunder, including, without limitation, expenses of
disposition of the Equipment, legal fees and all other amounts specified in
Paragraph 23 below; (ii) an amount equal to the sum of (A) any accrued and
unpaid Rent through the later of (1) the date of the applicable default or (2)
the date that Lessor has obtained possession of the Equipment or such other date
as Lessee has made an effective tender of possession of the Equipment to Lessor
(the "Default Date") and (B) if Lessor resells or re-lets the Equipment, Rent at
the periodic rate provided for in each Lease for the additional period that it
takes Lessor to resell or re-let all of the Equipment; (iii) the present value
of all future Rent reserved in the Leases and contracted to be paid over the
unexpired Term of the Leases discounted at five percent simple interest per
annum; (iv) the residual value of the Equipment as of the expiration of the Term
of the applicable Lease; and (v) any indebtedness for Lessee's indemnity under
Paragraph 18 above, plus a late charge at the rate specified in Paragraph 3
above, less the amount received by Lessor, if any, upon sale or re-let of the
Equipment; and (g) exercise any other right or remedy to recover damages or
enforce the terms of the Leases. Lessor may pursue any other rights or remedies
available at law or in equity, including, without limitation, rights or remedies
seeking damages, specific performance and injunctive relief. Any failure of
Lessor to require strict performance by Lessee, or any waiver by Lessor of any
provision hereunder or under any Schedule, shall not be construed as a consent
or waiver of any other breach of the same or of any other provision. Any
amendment or waiver of any provision hereof or under any Schedule or consent to
any departure by Lessee herefrom or therefrom shall be in writing and signed by
Lessor.
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No right or remedy is exclusive of any other provided herein or permitted
by law or equity. All such rights and remedies shall be cumulative and may be
enforced concurrently or individually from time to time.
23. LESSOR'S EXPENSE. Lessee shall pay Lessor on demand all costs and
expenses in protecting and enforcing Lessor's rights and interests in each Lease
and the Equipment, including, without limitation, legal, collection and
remarketing fees and expenses incurred by Lessor in enforcing the terms,
conditions or provisions of each Lease or, upon the occurrence and continuation
of an Event of Default.
24. LESSEE'S WAIVERS. To the extent permitted by applicable law, Lessee
hereby waives any and all rights and remedies conferred upon a lessee by
Sections 2A-508 through 2A-522 of the UCC. To the extent permitted by
applicable law, Lessee also hereby waives any rights now or hereafter conferred
by statute or otherwise which may require Lessor to sell, lease or otherwise use
any Equipment in mitigation of Lessor's damages as set forth in Paragraph 22
above or which may otherwise limit or modify any of Lessor's rights or remedies
under Paragraph 22. Any action by Lessee against Lessor for any default by
Lessor under any Lease shall be commenced within one year after any such cause
of action accrues.
25. NOTICES; ADMINISTRATION. Except as otherwise provided herein, all
notices, approvals, consents, correspondence or other communications required or
desired to be given hereunder shall be given in writing and shall be delivered
by confirmed facsimile telephone transmission, overnight courier, hand delivery
or certified or registered mail, postage prepaid, if to Lessor, then to 13760
Noel Road, Suite 1100, Dallas, Texas 75420, Attention: Division Operations
Manager, with a copy to Lessor at Riverway II, West Office Tower, 9399 West
Higgins Road, Rosemont, Illinois 60018, Attention: Legal Department or such
other address as shall be designated by Lessor to Lessee. All such notices and
correspondence shall be effective when received.
26. REPRESENTATIONS. Lessee represents and warrants to Lessor that (a)
Lessee is duly organized, validly existing and in good standing under the laws
of the State of its incorporation; (b) the execution, delivery and performance
by Lessee of this Agreement are within Lessee's powers, have been duly
authorized by all necessary action, and do not contravene (i) Lessee's
organizational documents or (ii) any law or contractual restriction binding on
or affecting Lessee; (c) no authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body is
required for the due execution, delivery and performance by Lessee of this
Agreement; and (d) each Lease constitutes the legal, valid and binding
obligations of Lessee enforceable against Lessee in accordance with its terms.
27. FURTHER ASSURANCES. Lessee, upon the request of Lessor, will
execute, acknowledge, record or file, as the case may be, such further documents
and do such further acts as may be reasonably necessary, desirable or proper to
carry out more effectively the purposes of this Agreement. Lessee hereby
appoints Lessor as its attorney-in-fact to execute on behalf of Lessee and
authorizes Lessor to file without Lessee's signature any UCC financing
statements and amendments Lessor deems advisable.
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28. FINANCIAL STATEMENTS. Lessee shall deliver to Lessor: (a) as soon as
available, but not later than 120 days after the end of each fiscal year of
Lessee and its consolidated subsidiaries, unqualified audited financial
statements, including the consolidated balance sheet, income statement and
statements of cash flows and shareholders equity for Lessee and its consolidated
subsidiaries (the "Financial Statement") for such year, reported on by
independent certified public accountants; and (b) as soon as available, but not
later than 60 days after the end of each of the first three fiscal quarters in
any fiscal year of Lessee and its consolidated subsidiaries, the Financial
Statements for such fiscal quarter, together with a certification duly executed
by a responsible officer of Lessee that such Financial Statements have been
prepared in accordance with generally accepted accounting principles and are
fairly stated in all material respects (subject to normal year-end audit
adjustments).
29. CONSENT TO JURISDICTION. Lessee irrevocably submits to the
jurisdiction of any Illinois state or federal court sitting in Illinois for any
action or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby, and Lessee irrevocably agrees that all claims
in respect of any such action or proceeding may be heard and determined in such
Illinois state or federal court.
30. WAIVER OF JURY TRIAL. LESSEE AND LESSOR IRREVOCABLY WAIVE ALL RIGHT
TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
31. FINANCE LEASE. Lessee and Lessor agree that each Lease is a "Finance
Lease" as defined by Section 2A-103(g) of the UCC. Lessee acknowledges that
Lessee has reviewed and approved each written Supply Contract (as defined by UCC
2A-103 (y)) covering Equipment purchased from each "Supplier" (as defined by UCC
2A-103 (x)) thereof.
32. NO AGENCY. Lessee acknowledges and agrees that neither the
manufacturer or supplier, nor any salesman, representative or other agent of the
manufacturer or supplier, is an agent of Lessor. No salesman, representative or
agent of the manufacturer or supplier is authorized to waive or alter any term
or condition of this Agreement or any Schedule and no representation as to the
Equipment or any other matter by the manufacturer or supplier shall in any way
affect Lessee's duty to pay Rent and perform its other obligations as set forth
in this Agreement or any Schedule.
33. SPECIAL TAX INDEMNIFICATION. Lessee acknowledges that Lessor, in
determining the Rent due hereunder, has assumed that certain tax benefits as are
provided to an owner of property under the Internal Revenue Code of 1986, as
amended (the "Code"), and under applicable state tax law, including, without
limitation, depreciation deductions under Section 168 (b) of the Code, and
deductions under Section 163 of the Code in an amount at least equal to the
amount of interest paid or accrued by Lessor with respect to any indebtedness
incurred by Lessor in financing its purchase of the Equipment, are available to
Lessor as a result of the lease of the Equipment. In the event (other than lack
of sufficient income by Lessor), Lessor is unable to obtain such tax benefits
for any reason, is required to include in income any amount other than the Rent
or is required to recognize income in respect of the Rent earlier than
anticipated pursuant to this Agreement, Lessee shall pay Lessor additional rent
("Additional Rent") in a lump sum in an amount needed to provide Lessor with
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the same after-tax yield and after-tax cash flow as would have been realized by
Lessor had Lessor (i) been able to obtain such tax benefits, (ii) not been
required to include any amount in income other than the Rent and (iii) not been
required to recognize income in respect of the Rent earlier than anticipated
pursuant to this Agreement. The Additional Rent shall be computed by Lessor,
subject to verification by Lessee. The Additional Rent shall be due immediately
upon written notice by Lessor to Lessee of Lessor's inability to obtain tax
benefits, the inclusion of any amount in income other than the Rent or the
recognition of income in respect of the Rent earlier than anticipated pursuant
to this Agreement. The provisions of this Paragraph 33 shall survive the
termination of this Agreement.
34. GOVERNING LAW; SEVERABILITY. EACH LEASE SHALL BE GOVERNED BY THE LAWS
OF THE STATE OF ILLINOIS. IF ANY PROVISION SHALL BE HELD TO BE INVALID OR
UNENFORCEABLE, THE VALIDITY AND ENFORCEABILITY OF THE REMAINING PROVISIONS SHALL
NOT IN ANY WAY BE AFFECTED OR IMPAIRED. LESSEE ACKNOWLEDGES THAT LESSEE HAS READ
THIS AGREEMENT AND THE SCHEDULE HERETO, UNDERSTANDS THEM, AND AGREES TO BE BOUND
BY THEIR TERMS AND CONDITIONS. FURTHER, LESSEE AND LESSOR AGREE THAT THIS
AGREEMENT AND THE SCHEDULES DELIVERED IN CONNECTION HEREWITH FROM TIME TO TIME
ARE THE COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN THE PARTIES,
SUPERSEDING ALL PROPOSALS OR PRIOR AGREEMENTS, ORAL OR WRITTEN, AND ALL OTHER
COMMUNICATIONS BETWEEN THE PARTIES RELATING TO THE SUBJECT MATTER HEREOF.
35. SECURITY DEPOSIT. Lessee shall pay to Lessor a security deposit in the
amount of 20% of the Equipment Cost (as shown on the Schedule) (the "Security
Deposit"). The Security Deposit shall be held by Lessor, unless applied as
provided herein, until termination of the Lease and full performance of the
obligations of Lessee under the Lease. Upon the occurrence of an Event of
Default, and notwithstanding a subsequent cure of such Event of Default, Lessor
may apply the Security Deposit to the obligations of Lessee under the Lease, in
the manner chosen by Lessor. Upon complete performance of and payment of the
obligations of Lessee under the Lease, and provided Lessor has not previously
applied the Security Deposit as herein provided, the Security Deposit shall be
returned to Lessee.
36. The term "Lessee" as used in the Lease and related documents shall
refer to Ameritruck Distribution Corp., Ameritruck Equipment Corp., J.C.
Bangerter & Sons, Inc., CMS Transportation Services, Inc., Ameritruck
Refrigerated Transport, Inc., KTL, Inc., Scales Transport Corporation, Thompson
Bros., Inc., W & L Motor Lines, Inc., Monfort Transportation Company, Lynn
Transportation Co., Inc., and Transtar, Inc., individually and collectively.
Notwithstanding anything the contrary contained in the Lease or any document
executed in connection therewith, each Lessee shall be jointly and severally
liable for any and all liabilities and obligations of Lessee arising under or in
connection with the Lease.
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IN WITNESS WHEREOF, the parties hereto have executed or caused this
Master Lease Agreement to be duly executed by their duly authorized officers
as of this 14 day of August, 1997.
AMERITRUCK DISTRIBUTION CORP., AND EVERY OTHER CO-LESSEE UNDER THE MASTER LEASE
By: /s/ KENNETH H. EVANS, JR.
-----------------------------------
Kenneth H. Evans, Jr., on behalf of each Co-Lessee
Title: Executive Vice President of Ameritruck Distribution Corp., and Treasurer
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of all other Co-Lessees
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