Exhibit 10.3
FIRST AMENDMENT TO REVOLVING CREDIT AND SECURITY AGREEMENT
First Amendment to Revolving Credit and Security Agreement, executed the 9th day
of May, 2011, to be effective as of March 31, 2011 (the “Effective Date”), by
and among Pac-Van, Inc., an Indiana corporation (“Pac-Van”), GFN North America
Corp., a Delaware corporation (“GFN”), the financial institutions party hereto
(collectively, the “Lenders” and individually a Lender”), and PNC Bank, National
Association (“PNC”), as administrative and collateral agent for the Lenders
(PNC, in such capacity, the “Agent”) (the “First Amendment”).
W I T N E S S E T H:
WHEREAS, Pac-Van and the other Borrowers party thereto, GFN and the other
Guarantors party thereto, the Lenders party thereto, Pac-Van Asset Trust, a
Delaware statutory trust formed under the Delaware Statutory Trust Act and the
Agent entered into that certain Revolving Credit and Security Agreement, dated
July 16, 2010 (as amended, modified, supplemented or restated from time to time,
the “Credit Agreement”), pursuant to which, among other things, the Lenders
agreed to extend credit to the Borrowers; and
WHEREAS, the Loan Parties desire to amend certain provisions of the Credit
Agreement and the Agent and the Lenders desire to permit such amendments
pursuant to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises contained herein and other
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, the parties hereto agree
as follows:
1. All capitalized terms used herein which are defined in the Credit Agreement
shall have the same meaning herein as in the Credit Agreement unless the context
clearly indicates otherwise.
2. Section 1.2 of the Credit Agreement is hereby amended by adding the following
definitions thereto in their appropriate alphabetical order:
“Equity Infusion” shall have the meaning set forth in Section 6.12 hereof.
“First Amendment Closing Date” shall mean May  _____  , 2011.
3. Section 6.5(b) of the Credit Agreement is hereby deleted in its entirety and
in its stead is inserted the following:
(b) Leverage Ratio. Maintain a ratio of Senior Funded Debt to EBITDA of not
greater than (i) 5.75 to 1.00 calculated as of the last day of the fiscal
quarter ending September 30, 2010 and as of the last day of each fiscal quarter
thereafter (other than the fiscal quarter ending March 31, 2011) through the
fiscal quarter ending September 30, 2011 for the period equal to the four (4)

 

 

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consecutive fiscal quarters then ending, (ii) 5.50 to 1.00 calculated as of the
last day of the fiscal quarter ending December 31, 2011 and as of the last day
of each fiscal quarter thereafter through the fiscal quarter ending June 30,
2012 for the period equal to the four (4) consecutive fiscal quarters then
ending, and (iii) 5.25 to 1.00 calculated as of the last day of the fiscal
quarter ending September 30, 2012 and as of the last day of each fiscal quarter
thereafter for the period equal to the four (4) consecutive fiscal quarters then
ending. Solely for purposes of the calculation of Senior Funded Debt to EBITDA
as of June 30, 2011 for the period equal to the four (4) consecutive fiscal
quarters then ending, “Senior Funded Debt” shall be reduced by the amount of the
Equity Infusion.
4. Article VI (Affirmative Covenants) of the Credit Agreement is hereby amended
to add the following new Section 6.12 immediately after Section 6.11:
6.12 Equity Infusion.
After the First Amendment Closing Date and no later than July 31, 2011, provide
evidence to Agent of (i) a cash equity infusion made during such time period
from investors acceptable to Agent of not less than Five Million and 00/100
Dollars ($5,000,000.00) in the aggregate in GFN and (ii) the contribution by GFN
of such cash equity to Pac-Van, in each case in form and substance satisfactory
to Agent (the aggregate amount of such cash equity infusion made and contributed
in accordance with this Section 6.12 is referred to herein as the “Equity
Infusion”).
5. Schedules 4.5, 4.15(h), 4.19, 5.2(a), and 5.8(b) to the Credit Agreement are
hereby deleted in their entirety and in their stead are inserted the Schedules
attached hereto as Exhibit A.
6. The provisions of Sections 2 through 5 and Section 8 of this First Amendment
shall not become effective until the Agent has received the following, each in
form and substance acceptable to the Agent:

  (a)  
this First Amendment, duly executed by the Loan Parties, the Required Lenders
and the Agent;
    (b)  
the documents and conditions listed in the Preliminary Closing Agenda set forth
on Exhibit B, attached hereto and made a part hereof;
    (c)  
payment of the Amendment Fee (as defined below) and all other fees and expenses
owed to the Agent and its counsel (i) for post-closing matters in connection
with the Credit Agreement and (ii) in connection with this First Amendment; and

  (d)  
such other documents as may be reasonably requested by the Agent or its counsel.

 

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7. The Loan Parties agree to pay, in immediately available funds, a
nonrefundable amendment fee in the amount of Eighty-Five Thousand and 00/100
Dollars ($85,000.00) (the “Amendment Fee”), due and payable to the Agent for the
ratable benefit of the Lenders on or prior to the date of this First Amendment.
8. Pursuant to Section 4.5(a) of the Credit Agreement, the Loan Parties agreed,
among other things, not to remove any Equipment or Inventory from a location set
forth on Schedule 4.5 of the Credit Agreement (as such schedule existed prior to
the date of this First Amendment, the “Existing Schedule 4.5”) without the prior
written consent of the Agent, with certain exceptions. The Loan Parties have
informed the Agent that in connection with entering into new leases, as more
specifically identified on the updated Schedule 4.5 attached to this First
Amendment (the “New Schedule 4.5”), the Loan Parties removed Equipment and/or
Inventory from locations set forth on Schedule 4.5 and transferred such
Equipment and/or Inventory to such new leased locations, in contravention of
Section 4.5(a) of the Credit Agreement. As a result of the foregoing, an Event
of Default has occurred under Section 10.5 of the Credit Agreement.
Pursuant to Section 9.11 of the Credit Agreement, the Loan Parties agreed, among
other things, to furnish to the Agent at least fifteen (15) days prior thereto,
notice of any Loan Party’s opening of any new office or place of business or any
Loan Party’s closing of any existing office or place of business. The Loan
Parties have informed the Agent that as a result of opening new offices and
closing existing offices, as more specifically identified on the New
Schedule 4.5, and failing to notify the Agent of the opening and closing of such
offices, as applicable, the Loan Parties acted in contravention of Section 9.11
of the Credit Agreement. As a result of the foregoing, an Event of Default has
occurred under Section 10.5 of the Credit Agreement.
Pursuant to Section 8 of the Individual Guarantor Pledge and Security Agreement,
the Individual Guarantors agreed, among other things, not to create or permit to
exist any Lien upon or with respect to any of the Collateral (as defined in the
Individual Guarantor Pledge and Security Agreement), except for the security
interest granted under the Individual Guarantor Pledge and Security Agreement.
The Loan Parties have informed the Agent that as a result of a federal tax lien
in the amount of Two Million Four Hundred Forty One Thousand Eighty Two and
65/100 Dollars ($2,441,082.65) filed against RFV and LDV, the Individual
Guarantors permitted a Lien upon the Collateral (as defined in the Individual
Guarantor Pledge and Security Agreement) in contravention of Section 8 of the
Individual Guarantor Pledge and Security Agreement. As a result of the
foregoing, an Event of Default has occurred under Sections 10.11 and 10.14 of
the Credit Agreement.
Notwithstanding the foregoing, the Loan Parties have requested that the Agent
and the Lenders waive the Events of Default that have occurred under the Credit
Agreement as a result of the violations described in this Section 8. Please be
advised that the Agent and the Lenders hereby waive the Events of Default
described in this Section 8.

 

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9. The Loan Parties hereby reconfirm and reaffirm all representations and
warranties, agreements and covenants made by and pursuant to the terms and
conditions of the Credit Agreement, except as such representations and
warranties, agreements and covenants may have heretofore been amended, modified
or waived in writing in accordance with the Credit Agreement or as set forth in
this First Amendment and except any such representations or warranties made as
of a specific date or time, which shall have been true and correct in all
material respects as of such date or time.
10. The Loan Parties acknowledge and agree that each and every document,
instrument or agreement which at any time has secured payment of the Obligations
including, but not limited to, the Credit Agreement, each Pledge Agreement, the
IP Security Agreement, each Deposit Account Control Agreement, the Individual
Guarantor Pledge and Security Agreement and the Individual Guarantor Account
Control Agreement continue to secure prompt payment when due of the Obligations.
11. The Loan Parties hereby represent and warrant to the Lenders and the Agent
that (i) the Loan Parties have the legal power and authority to execute and
deliver this First Amendment; (ii) the officers of the Loan Parties executing
this First Amendment have been duly authorized to execute and deliver the same
and bind the Loan Parties with respect to the provisions hereof; (iii) the
execution and delivery hereof by the Loan Parties and the performance and
observance by the Loan Parties of the provisions hereof and of the Credit
Agreement and all documents executed or to be executed therewith, do not violate
or conflict with the organizational documents of the Loan Parties or any law
applicable to the Loan Parties or result in a breach of any provision of or
constitute a default under any other agreement, instrument or document binding
upon or enforceable against the Loan Parties and (iv) this First Amendment, the
Credit Agreement and the documents executed or to be executed by the Loan
Parties in connection herewith or therewith constitute valid and binding
obligations of the Loan Parties in every respect, enforceable in accordance with
their respective terms.
12. The Loan Parties represent and warrant that (i) other than the Events of
Default described in Section 8 of this First Amendment, no Event of Default
exists under the Credit Agreement, nor will any occur as a result of the
execution and delivery of this First Amendment or the performance or observance
of any provision hereof; and (ii) they presently have no claims or actions of
any kind at law or in equity against the Lenders or the Agent arising out of or
in any way relating to the Credit Agreement or the Other Documents.
13. Each reference to the Credit Agreement that is made in the Credit Agreement
or any other document executed or to be executed in connection therewith shall
hereafter be construed as a reference to the Credit Agreement as amended hereby.
14. The agreements contained in this First Amendment are limited to the specific
agreements contained herein. Except as amended hereby, all of the terms and
conditions of the Credit Agreement and the Other Documents shall remain in full
force and effect. This First Amendment amends the Credit Agreement and is not a
novation thereof.
15. This First Amendment may be executed in any number of counterparts and by
the different parties hereto on separate counterparts each of which, when so
executed, shall be deemed to be an original, but all such counterparts shall
constitute but one and the same instrument.

 

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16. This First Amendment shall be governed by, and shall be construed and
enforced in accordance with, the laws of the State of New York applied to
contracts to be performed wholly within the State of New York. The Loan Parties
hereby consent to the jurisdiction and venue of any federal or state court
located in the County of New York, State of New York with respect to any suit
arising out of or mentioning this First Amendment.
[INTENTIONALLY LEFT BLANK]

 

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IN WITNESS WHEREOF, and intending to be legally bound, the parties hereto, have
caused this First Amendment to be duly executed by their duly authorized
officers on the day and year first above written, to be effective as of the
Effective Date.

              BORROWER:
 
            PAC-VAN, INC.
 
       
 
  By:   /s/ Christopher A. Wilson
 
       
 
  Name:   Christopher A. Wilson
 
       
 
  Title:   Secretary
 
       

              GUARANTOR:
 
            GFN NORTH AMERICA CORP.
 
       
 
  By:   /s/ Charles E. Barrantes
 
       
 
  Name:   Charles E. Barrantes
 
       
 
  Title:   Executive Vice President and Chief Financial Officer
 
       

 

 

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Acknowledged and consented to on May 9, 2011:
/s/ Ronald F. Valenta
Ronald F. Valenta
/s/ Lydia D. Valenta
Lydia D. Valenta

 

 

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            AGENT AND LENDERS:

PNC BANK, NATIONAL ASSOCIATION, as
Agent and as a Lender
      By:   /s/ Todd Milenius         Name:   Todd Milenius        Title:   Vice
President     

 

 

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            WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender
      By:   /s/ James A. Stehlik         Name:   James A. Stehlik       
Title:   Vice President     

 

 

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            UNION BANK, N.A., as a Lender
      By:   /s/ Erik Siegfried         Name:   Erik Siegfried        Title:  
Vice President     

 

 

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EXHIBIT A
UPDATED SCHEDULES
[see attached]

 

 

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EXHIBIT B
PRELIMINARY CLOSING AGENDA
[see attached]