PURCHASE AGREEMENT
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This Purchase Agreement (this "Agreement") is entered into as of February
24, 2003 between Residual Based Finance Corporation, an Illinois corporation,
Three First ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Seller"), and
PLM Transportation Equipment Corporation, a California corporation with its
principal place of business at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Purchaser").
BACKGROUND
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A. Seller is a party to a certain Equipment Lease Agreement dated as of
March 31, 1975, as amended by the Amendment as hereinafter defined (as so
amended, referred to herein as the "Lease") originally between ▇▇▇▇▇▇▇ Sea, Air
& Rail Co., a Utah corporation, as lessor (the "Original Lessor"), and Celanese
Corporation, a Delaware corporation, as lessee (the "Original Lessee"),
providing for the lease of the railroad cars described on Exhibit A hereto (each
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a "Unit of Equipment" and collectively, the "Equipment") and certain additional
railcars which have been subject to an "Event of Loss" (as defined in the
Lease). The Lease has been amended pursuant to that certain Amendment (the
"Amendment") dated as of June 30, 1995 originally between Cypress Equipment
Fund, Ltd., a Florida limited partnership ("Cypress") and Hoechst Celanese, a
Delaware corporation ("Hoechst"), and successor by merger to the Original
Lessee.
B. Seller purchased the Equipment from Cypress and received an assignment of
the rights of Cypress as lessor under the Lease pursuant to that certain
Purchase Agreement (the "Prior Purchase Agreement") and that certain Assignment
of Lease (the "Prior Assignment"), each dated as of August 31, 1995 and between
Cypress and Seller.
C. Hoechst assigned its rights and obligations as lessee under the Lease to
Celtran, Inc., a Delaware corporation ("Lessee"), pursuant to that certain
Assignment and Assumption Agreement dated as of August 18, 1995, between Lessee
and Hoechst (the "Lessee Assignment"), and consented to by Cypress pursuant to
that certain consent dated August 31, 1995 (the "Consent").
D. To induce Cypress to enter into the Consent, Hoechst entered into that
certain Guaranty, dated as of August 18, 1995, as to Lessee's obligations under
the Lease (the "Guaranty").
E. Fleet National Bank ("Fleet"), as successor by merger to Sanwa Business
Credit Corporation, and Seller are parties to that certain Chattel Mortgage,
Assignment and Security Agreement (the "Chattel Mortgage"), and that certain
Memorandum of Chattel Mortgage, Assignment and Security Agreement (the
"Memorandum") each dated as of August 31, 1995, and in connection therewith
Seller executed and delivered to Sanwa Business Credit Corporation that certain
Non-Recourse Note dated August 31, 1995 in the original principal amount of
$2,128,996 (the "Note").
E. Seller desires to sell to Purchaser, and Purchaser desires to purchase
from Seller, all rights of the lessor in, to and under the Lease and the
Equipment, at the price and on the terms and conditions hereinafter set forth,
subject to all obligations of the Seller in connection therewith and under the
Chattel Mortgage, the Memorandum and the Note (collectively, the "Financing
Documents").
NOW, THEREFORE, in consideration of the premises and the following mutual
agreements the parties hereto hereby agree as follows:
1. PURCHASE AND SALE OF EQUIPMENT AND LEASE.
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1.01 Transfer of Equipment and Lease. Subject to the terms and
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conditions hereof, on the Closing Date (as hereinafter defined) Seller shall
sell and assign to Purchaser, and Purchaser shall purchase from Seller, all
right, title and interest in and to the Equipment and all rights and remedies of
the Seller under the Lease, the Guaranty and the Lessee Assignment
(collectively, the "Assigned Documents"), and Purchaser shall assume all
obligations of the Seller under the Financing Documents pursuant to the
Financing Assignment (as hereinafter defined).
1.02 Purchase Price. The purchase price (the "Purchase Price") for the
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Equipment and Seller's interest in the Assigned Documents is $1,205,961.50,
including $181,200 paid in cash and $1,024,761.51 representing the unpaid
principal, plus in each case interest, payable on the Note as of the Closing
Date. Subject to satisfaction of the conditions precedent set forth in Section
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1.03 hereof on the Closing Date, payment of $181,200 representing the cash
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portion of the Purchase Price shall be made by Purchaser to Seller by wire
transfer to Seller of immediately available funds on February 24, 2003 (the
"Closing Date") as follows:
Bank: Fifth Third Bank
Location: Cincinnati, Ohio
Account name: Residual Based Finance Corporation
Account number: 7512941001
ABA number: ▇▇▇▇▇▇▇▇▇
1.03 Closing Conditions. Purchaser's obligations on the Closing Date are
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subject to the condition precedent that Purchaser shall have received each of
the following:
(i) a ▇▇▇▇ of sale conveying title to the Equipment to Purchaser in the form
annexed hereto as Exhibit B ("▇▇▇▇ of Sale");
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(ii) an assignment of lease conveying Seller's interest as Lessor under the
Lease to Purchaser and its rights under the other Assigned Documents in the form
annexed hereto as Exhibit C ("Assignment of Lease"); and
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(iii) an opinion of Messrs. ▇▇▇▇▇▇ & ▇▇▇▇▇▇ as to the Equipment and the
Lease, and liens thereon, dated the Closing Date and showing the Lease of record
and no other effective filings on the Equipment or the Lease with the Interstate
Commerce Commission ("ICC") (except for the Financing Documents) and otherwise
satisfactory to Purchaser.
Seller's obligations on the Closing Date are subject to the condition
precedent that Seller shall have received each of the following:
(i) the Assignment of Lease duly executed by Purchaser; and
(ii) an agreement assuming Seller's obligations under the Financing
Documents pursuant to an Assignment of Financing Documents in the form annexed
hereto as Exhibit D (the "Financing Assignment").
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1.04 Events of Loss; Rent. If any Unit of Equipment suffers an "Event of
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Loss", as defined in the Lease, after the date hereof and before the Closing
Date, Seller shall nonetheless sell such Unit of Equipment hereunder, and any
Stipulated Loss Value (as defined in the Lease) payable under the Lease with
respect thereto shall be paid to Purchaser. Purchaser shall, subject to the
rights of Fleet, receive the rent payable under the Lease after March 1, 2003.
2. REPRESENTATIONS AND WARRANTIES OF SELLER. Seller represents and
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warrants to Purchaser that:
2.01 Concerning the Lease. Seller has made no prior assignment of its
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rights under the Lease (except under the Financing Documents), and such interest
is owned and held by Seller free from any liens, claims, encumbrances, security
interests, set-offs, counterclaims and other defenses (collectively, "Liens"),
except for the Liens evidenced by the Financing Documents, the Lease and Liens
permitted by the Lease or which Lessee is obligated to discharge under the Lease
(collectively, "Permitted Encumbrances"). Seller has not breached any of the
provisions of the Lease applicable to Seller. Seller has delivered to Seller
true correct and complete copies of the Lease and all amendments thereto,
together with all currently effective waivers and consents relating thereto
No approval or consent of any governmental body or authority or any other party
is necessary for the execution, delivery and performance by Seller of this
Agreement, the ▇▇▇▇ of Sale or the Assignment of Lease. Seller is not aware of
any existing Event of Default under the Lease, or an event that with the passage
of time, the giving of notice, or both, would become an Event of Default.
Seller isn't insolvent. No amounts due after the date hereof under the Lease
have been prepaid, except for rent due on or about March 1, 2003. To Seller's
knowledge all property, sales and other taxes due with respect to the Equipment
have been paid, except for taxes not yet due or which are being contested by
action taken in good faith.
2.02 Equipment and Title. Seller has no knowledge of any Event of Loss with
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respect to the Equipment or of any condition or event which, upon the giving of
notice or the lapse of time, or both, would constitute an Event of Loss. Seller
owns, and by the ▇▇▇▇ of Sale and the Assignment of Lease shall transfer to
Purchaser, good and marketable title to the Equipment and all of the rights of
the lessor under the Lease and all of the other Assigned Documents free and
clear of all Liens other than Permitted Encumbrances.
2.03 Notices. Seller has not received any notice from any governmental
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authority that any investigation has been commenced or is contemplated
respecting any failure of the Equipment or the Lease to comply with any laws,
rules, regulations or orders.
2.04 Documents Furnished. Seller has delivered to Purchaser true and
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correct copies of the Lease, the Amendment and the other Assigned Documents.
Seller is not a party to, and does not have any obligations in respect of any
option or residual sharing agreement, residual guarantee or insurance agreement,
remarketing agreement or deferred fee agreement, whether denominated as such an
agreement or not, with respect to any of the Equipment.
2.05 Organization and Existence. Seller is a corporation duly and validly
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organized and existing under the laws of the State of Illinois.
2.06 Power and Authority. Seller has the power and authority to execute and
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deliver or accept, as the case may be, this Agreement, the ▇▇▇▇ of Sale, the
Assignment of Lease, the Financing Assignment and the other documents,
instruments and agreements to be executed by it pursuant to this Agreement
(collectively, the "Transaction Documents") and to perform its obligations
hereunder and thereunder.
2.07 Authorizations. The execution and delivery or acceptance, as the case
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may be, of this Agreement and the other Transaction Documents executed or to be
executed by Seller and the performance by Seller, when due, of its obligations
hereunder and thereunder, have been duly authorized by all necessary action of
Seller and do not and will not violate or conflict with, or, with or without the
giving of notice, the passage of time or both, constitute a default under, or
result in any Lien on the Equipment or the Lease under, any provision of
Seller's instruments of organization, any law, order, writ, injunction, decree,
rule or regulation of any court, administrative agency or any other governmental
authority, or any agreement or other document or instrument to which Seller is a
party or by which Seller is, or may be, bound, except in each case for Permitted
Encumbrances.
2.08 Enforceability. This Agreement and the other Transaction
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Documents executed or to be executed by Seller constitute the legal, valid and
binding obligations of Seller, enforceable against Seller in accordance with
their respective terms, except for the condition that enforceability of the
Transaction Documents may be (i) limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws and decisions affecting creditors'
rights generally and (ii) subject to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
2.09 Litigation. There is no litigation, proceeding or investigation
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pending or, to the knowledge of Seller, threatened, against or involving Seller
or its assets or properties that, either individually or in the aggregate, if
adversely determined, would prohibit or materially frustrate the consummation by
Seller of the transactions contemplated in the Transaction Documents or the
Lease. There are no outstanding judgments, decrees or orders of any court or
any governmental authority against Seller or affecting Seller's ability to
transfer the Lease or the Equipment to Purchaser.
2.10 Brokers. No person or entity acting on behalf of Seller or any
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affiliate thereof is or will be entitled to any brokerage fee, commission,
finder's fee or financial advisory fee, directly or indirectly, in connection
with the transactions contemplated in the Transaction Documents.
2.11 CONDITION OF EQUIPMENT. THE SALE OF THE EQUIPMENT AND THE ASSIGNMENT
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OF THE LEASE IS ON AN "AS-IS WHERE-IS" BASIS AND WITHOUT RECOURSE TO SELLER AND
SELLER MAKES NO REPRESENTATIONS OR WARRANTIES, EITHER EXPRESS OR IMPLIED, WITH
RESPECT TO THE DESIGN, QUALITY OR CONDITION OF ANY OF THE EQUIPMENT, THE LEASE,
THE LESSEE OR ANY OTHER MATTER RELATING THERETO EXCEPT AS EXPRESSLY SET FORTH IN
THIS AGREEMENT. SELLER DISCLAIMS ANY WARRANTIES (EXPRESS OR IMPLIED) WITH
RESPECT TO THE EQUIPMENT'S CONDITION, DESIGN, MERCHANTABILITY OR FITNESS FOR ANY
PARTICULAR USE OR PURPOSE, INCLUDING THE WARRANTIES OF MERCHANTABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE, AND BY ITS ACCEPTANCE OF THE ▇▇▇▇ OF SALE,
PURCHASER EXPRESSLY RELIEVES AND EXONERATES SELLER OF ANY RESPONSIBILITY FOR THE
EQUIPMENT'S CONDITION, DESIGN, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR USE
OR PURPOSE.
3. REPRESENTATIONS AND WARRANTIES OF PURCHASER.
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Purchaser represents and warrants to, and agrees with, Seller as follows:
3.01 Organization and Existence. Purchaser is a corporation duly and
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validly organized and existing under the laws of the State of California and is
duly qualified to own its properties and carry on its business in each
jurisdiction where the failure to be so qualified would be materially adverse to
Purchaser or its business.
3.02 Power and Authority. Purchaser has the power and authority to execute
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and deliver or accept, as the case may be, this Agreement and the other
Transaction Documents to which it is a party and to pay and perform, when due,
its obligations hereunder and thereunder.
3.03 Authorization. The execution and delivery or acceptance by Purchaser,
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as the case may be, of this Agreement and the other Transaction Documents
executed or to be executed by Purchaser and the payment and performance by
Purchaser, when due, of its obligations hereunder and thereunder, have been duly
authorized by all necessary action of Purchaser and do not and will not violate
or conflict with, or, with or without the giving of notice, the passage of time
or both, constitute a default under any provision of Purchaser's instruments of
organization, any law, order, writ, injunction, decree, rule or regulation of
any court, administrative agency or any other governmental authority or any
agreement or other document or instrument to which Purchaser is a party or by
which Purchaser is, or may be, bound.
3.04 Enforceability. This Agreement and the other Transaction Documents
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executed or to be executed by Purchaser constitute or will constitute the legal,
valid and binding obligations of Purchaser, enforceable against it in accordance
with their respective terms, except for the condition that enforceability of the
Transaction Documents may be (i) limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws and decisions affecting creditors'
rights generally (including fraudulent conveyance or fraudulent transfer laws)
and (ii) subject to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
4. CERTAIN TAXES. Seller shall pay all income, sales, use, excise,
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property, employment, gross receipts, stamp, leasing and transfer or other
similar taxes, if any, due as a result of Seller's ownership of the Equipment
and receipt of rentals under the Lease during the term thereof accruing or paid
before the Closing Date to the extent not required to be paid by the Lessee
under the Lease. Purchaser shall be liable for and shall indemnify and hold
harmless the Seller from and against any and all sales, use, excise, property,
transfer, and other taxes and fees, levies, imposts, duties, charges,
withholdings and assessments as they relate to the sale of the Lease or the
Equipment hereunder or as a result of Purchaser's ownership of the Equipment and
receipt of rentals under the Lease during the term thereof accruing or paid on
or after the Closing Date; provided, however, that Purchaser shall not have any
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liability for indemnification under this Section 4 for any net income taxes,
gross receipts taxes or similar taxes on income, capital, net worth, retained
earnings or investments of Seller.
5. INDEMNIFICATION.
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5.01 Indemnification by Seller. Seller agrees to indemnify Purchaser,
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and to protect, defend and hold Purchaser harmless, from and against any and all
loss, cost, damage, injury or expense, including, without limitation, reasonable
attorneys' fees, whensoever and howsoever arising, which Purchaser may incur
for, or by reason of, (i) the untruthfulness of any of the warranties or
representations of Seller contained in any of the Transaction Documents or any
other document delivered pursuant hereto, (ii) a breach by Seller of any of the
warranties or agreements of Seller contained in any of the Transaction Documents
or any other document delivered pursuant hereto, or (iii) any claim in any way
relating to or arising or alleged to arise out of the Lease or the ownership of
the Equipment on or prior to the Closing Date (except to the extent subject to
indemnification in favor of Purchaser under the Lease).
5.02 Indemnification by Purchaser. Purchaser agrees to indemnify Seller,
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and to protect, defend and hold Seller harmless, from and against any and all
loss, cost, damage, injury or expense, including, without limitation, reasonable
attorneys' fees, whensoever and howsoever arising, which Seller may incur for,
or by reason of, (i) the untruthfulness of any of the warranties or
representations of Purchaser contained in any of the Transaction Documents or
any other document delivered pursuant hereto, or (ii) a breach by Purchaser of
any of the warranties or agreements of Purchaser contained in any of the
Transaction Documents or any other document delivered pursuant hereto, or (iii)
any claim in any way relating to or arising or alleged to arise out of the Lease
or ownership of the Equipment after the Closing Date (except to the extent
subject to indemnification in favor of Seller under the Lease).
6. MISCELLANEOUS.
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6.01 Brokerage Fees. Seller represents and warrants to Purchaser that
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Seller has not engaged any third party broker to which fees are payable in
connection with the transactions referred to herein. Purchaser represents and
warrants to Seller that Purchaser has not engaged any third party broker to
which fees are payable in connection with the transactions referred to herein.
6.02 Transaction Costs and Legal Fees. Seller and Purchaser shall bear
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their own expenses, including, but not limited to, expenses for outside counsel
in connection with the transactions contemplated by this Agreement. The fees
and expenses of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ shall be paid by Purchaser.
6.03 Survival. The representations, warranties and agreements made herein
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or in any document delivered pursuant hereto shall survive the execution and
delivery of this Agreement and the consummation of the transactions described
herein. The representations and warranties of each party set forth herein shall
be deemed to be repeated and restated hereby on the Closing Date as if made on
such date.
6.04 Successors and Assigns. This Agreement shall be binding upon, and
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inure to the benefit of, the parties hereto and their respective successors and
assigns.
6.05 Notices. Any notice, request or other communication required or
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permitted to be given under any of the provisions of this Agreement shall be
given in writing and shall be deemed given the date the same is actually
received by the party to whom it is addressed, provided that if such notice is
mailed by certified or registered mail, return receipt requested, postage
prepaid and addressed to the party for which it is intended, such mailed notice
shall be deemed received 3 days after the mailing date. All notices shall be
sent to the parties at the addresses set forth on the first page of this
Agreement, together with a copy to one additional addressee as may be requested
by notice given hereunder, or at such other address as either party may
hereafter designate to the other in a like notice.
6.06 Total Agreements. This Agreement, including the Exhibits, and
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other agreements referred to herein, is the entire agreement between the parties
relating to the subject matter hereof, incorporates or rescinds all prior
agreements and understandings between the parties relating to the subject matter
hereof, cannot be changed or terminated orally, and shall be deemed effective as
of the date it is executed and delivered by the parties hereto.
6.07 Governing Law. This Agreement shall be governed by and
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interpreted under the laws of the State of Illinois applicable to contracts made
and to be performed therein, without giving effect to the principles of conflict
of laws thereof.
6.08 Captions. Captions used herein are inserted for reference purposes
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only and shall not affect the interpretation or construction of this Agreement.
6.09 Counterparts. This Agreement may be executed in one or more
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counterparts, each of which shall be deemed an original, but all of which
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together shall constitute one and the same agreement. Delivery by telecopy by a
party of a copy of an executed counterpart hereof shall constitute execution and
delivery hereof by such party.
6.10 Severability. The invalidity or unenforceability of any provision of
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this Agreement shall not affect the validity or enforceability of any other
provison.