Document:

exhibit103.htm

 

Exhibit 10.3

SERVICE AGREEMENT

 

THIS SERVICE AGREEMENT (this “Agreement”) is dated as of September 28, 2015, by and between Quality Companies, LLC, formerly dba Quality Equipment Sales, an Indiana limited liability company, and Quality Equipment Leasing, LLC, dba Quality Equipment Sales, a Delaware limited liability company, (collectively “Servicer”), and 19th Capital Group, LLC, a Delaware limited liability company (“Purchaser”).

 

WHEREAS, Servicer (as Seller) and Purchaser have entered into a Portfolio Purchase and Sale Agreement of even date herewith (the “Purchase Agreement”), whereby Servicer agreed to sell and assign to Purchaser certain Transactions and the Assigned Property related thereto, including its rights in and to the Payments due under the Transaction Documents (collectively, the “Existing Transactions”);

 

WHEREAS, Servicer and Purchaser have entered into a Program Agreement (the “Program Agreement”) and a Fleet Program Agreement (the “Fleet Program Agreement”) (together the “Program Agreements”) under which Servicer may refer certain Independent Contractors and Fleets (together the “Obligors”) to Purchaser on an ongoing basis for the purpose of the Obligors entering into Transactions with Purchaser in which such Obligors would lease or finance Delivery Vehicles for use in delivering goods and Vehicles used by Fleets as set forth in the Program Agreements (individually a “Delivery Vehicle” or “Fleet Vehicle” or a “Vehicle” and together “Vehicles”), and in the future Servicer (as Seller) and Purchaser may enter into additional Portfolio Purchase and Sale Agreements, in which Servicer will to sell and assign to Purchaser certain Transactions and Assigned Property related thereto, including its rights in and to the Payments due under the Transaction Documents (the transactions contemplated by the Program Agreements and any future Portfolio Purchase and Sale Agreements are referred to collectively as the “Future Transactions”);

 

WHEREAS, Purchaser and Servicer have agreed that, unless and until Servicer is terminated as billing and collecting agent under this Agreement, Servicer shall serve as billing and collecting agent for the benefit of Purchaser to perform certain administrative duties in connection with the Existing Transactions and Future Transactions and Payments, to the extent set forth herein, including, without limitation, the obligation to collect and receive the Payments on behalf of Purchaser and to remit same to Purchaser, and to ensure that insurance remains in place and that all sales, use, personal property, privilege, license and other taxes arising under or in connection with the Assigned Interests are paid (“Tax Payments”) and that all tax returns, reports and filings (“Tax Filings”) are properly made; and

 

WHEREAS, Servicer and Purchaser desire to set forth the terms and conditions under which Servicer will be responsible for the servicing and administration of the Existing Transactions and Future Transactions and Payments in connection therewith, including collection, receipt and remittance of the Payments on behalf of Purchaser.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, and of other valuable consideration, receipt of which is hereby acknowledged, the parties hereby agree as follows:

 

  

  

  

 

	
1.

	
Capitalized terms used herein but not otherwise defined herein shall have the meanings assigned to such terms in the Purchase Agreement and the Program Agreements, as applicable. The following terms used herein shall have the meanings indicated:

 

“Distribution Date” means the tenth day of each calendar month.

 

“Event of Bankruptcy” means either of the following:

 

	
  

	
(a)

	
Servicer shall become insolvent or bankrupt or shall admit in writing its inability to pay any portion of its debts as they mature or make an assignment for the benefit of creditors, or a receiver or trustee shall have been appointed with respect to it or to any of its estate; or

 

	
  

	
(b)

	
any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings or other proceedings for relief under Title 11 of the United States Code or any federal or state bankruptcy or insolvency law or similar law now or hereafter in force for the relief of debtors shall be instituted by or against Servicer, shall be consented to by Servicer or shall not be dismissed within sixty (60) days of such institution or Servicer shall take any action in the furtherance of the institution of any such proceeding.

 

“Reporting Period” means each calendar month.

 

	
2.

	
Collection of Payments.

 

	
  

	
(a)

	
Servicer agrees at its sole cost and expense to act as billing and collecting agent for the benefit of Purchaser as follows:

 

	
  

	
(1)

	
All Transaction payment amounts shall be automatically deducted from the earnings of the Independent Operator and paid to Servicer for the benefit of, and shall be held in trust for, Purchaser (the “Actual Payment”).

 

	
  

	
(2)

	
For Transactions that have variable lease payments, Servicer and Purchaser shall agree upon an expected monthly lease payment for each Transaction (the “Expected Payment”).

 

	
  

	
(3)

	
Servicer shall pay to the Purchaser the Expected Payment and the contractual amount for Transactions with fixed payments for each outstanding Transaction by the 10th day of each month, in arrears.  Accompanying the payment will be an Excel file which will include the following fields (and such other information as may be reasonably requested by Purchaser):

 

  

  

  

 

 

	
  

	
(4)

	
A template of the above file will be provided to the Servicer at or before Closing of the Purchase Agreement between the parties.

 

	
  

	
(5)

	
Each month, by the 5th business day following the end of the preceding month, Servicer shall provide a copy of the “Lock Box File” to the Purchaser. The Lock Box File is a file the form of which will be prepared by Servicer approved by Purchaser and reflects, by Transaction, the actual cash collected during the month from Obligors.

 

	
  

	
(6)

	
Servicer shall maintain the Reserve Account in accordance with the Reserve Account Agreement entered into between the Servicer and Purchaser of even date herewith.

 

	
  

	
(7)

	
With respect to Transactions that are terminated for reasons other than a default by an Obligor, including but not limited to, the early termination of the Transaction by the Obligor, loss due to accident, or the mutual agreement of the Servicer and Purchaser to sell a Delivery Vehicle or Vehicle to third parties in the market place, the proceeds from such event necessary to satisfy Purchaser’s Net Book Value (as defined in Section 2(c)(2) herein) for the Transaction will be paid to the Purchaser within forty-eight (48) hours of such receipt and Purchaser shall return the title associated with such Delivery Vehicle or Vehicle to Servicer within ten (10) business days of Purchaser’s receipt of its Net Book Value for the Transaction. To the extent the proceeds received by Servicer exceed Purchaser’s Net Book Value for the Transaction, such excess proceeds shall be divided between Servicer and Purchaser after Servicer has been reimbursed for actual cost of reseating the Delivery Vehicle as approved by Purchaser and any shortfall the Servicer experienced in making the Expected Payments and the contractual payments.

 

	
  

	
(b)

	
Maintenance of Delivery Vehicles. Servicer shall manage the regular maintenance of the Delivery Vehicles which are the subject of the Transactions as follows:

 

	
  

	
(1)

	
Each of the Existing Transactions and Future Transactions call for payment by Independent Operators into a maintenance fund created with respect to each Delivery Vehicle subject to a Transaction and based on the total number of miles the Delivery Vehicle is driven per month by the Obligor (each said fund is referred to a “Maintenance Fund” and the aforesaid payment contributions are referred to, collectively, as “Maintenance Contributions”).

 

  

  

  

 

	
  

	
(2)

	
All Maintenance Contributions shall be automatically deducted from the earnings of Independent Operators and paid to Servicer for Servicer’s benefit to be used to fund the repairs of the Delivery Vehicles.

 

	
  

	
(3)

	
Servicer shall keep an accounting of the Maintenance Fund for each Transaction.

 

	
  

	
(4)

	
If maintenance or repair of a Delivery Vehicle is necessary, Servicer shall use the Maintenance Fund for the applicable Transaction to pay for the necessary maintenance or repair.

 

	
  

	
(5)

	
If the Maintenance Fund is insufficient to cover the expense of maintenance or repair, Servicer shall make arrangements with the Independent Operator for credit with respect to the deficient amount to be paid over time by future Maintenance Fund payments.

 

	
  

	
(6)

	
Purchaser shall have no obligation with respect to any Maintenance Fund or any maintenance or repair of Delivery Vehicles which are the subject of the Transactions unless Purchaser should elect to terminate this Agreement and Servicer’s rights and obligations, as servicer, hereunder.

 

	
  

	
(c)

	
Remarketing and Sale of Vehicles. Servicer shall be responsible for the remarketing and eventual sale of Vehicles as follows:

 

	
  

	
(1)

	
In the event that an Obligor obligated on a Transaction shall default on the Transaction prior to its maturity, Servicer shall promptly notify Purchaser of such default and Servicer’s planned course of conduct in accord with this section of this Agreement.

 

	
  

	
(2)

	
When a default occurs, Servicer shall first determine whether the present residual value of the Vehicle is in excess of the Net Book Value of the Vehicle (the “Net Book Value” being calculated by adding the Transaction payments remaining until maturity to the expected eventual residual value). Purchaser may waive this requirement for payment of the Net Book Value at its discretion. Servicer shall inform Purchaser of the potential sale price of a Vehicle when a default occurs.

 

	
  

	
(3)

	
If the present residual value of the Vehicle is in excess of the current Net Book Value of such Vehicle, Servicer may sell such Vehicle or, with the authorization of the Purchaser, enter into a lease for such Vehicle.

 

	
  

	
(4)

	
If the Vehicle is sold, the proceeds from the sale of the Vehicle shall be distributed within 48 hours of Servicer’s receipt of such proceeds as follows: (a) the Net Book Value of such Vehicle shall be remitted to the Purchaser; (b) any excess cost beyond the maintenance balance retained from Independent Operator for the reconditioning of the Vehicle for sale shall be returned to the Reserve Account held with the Servicer pursuant to the Reserve Account Agreement between the parties of even date herewith (the “Reserve Account Agreement”); and (c) any excess funds remaining after the disbursements under (a) and (b) above shall be divided 50% to Servicer and 50% to Purchaser.

 

  

  

  

 

	
  

	
(5)

	
If the present residual value of the Vehicle is not in excess of the current Net Book Value of such Vehicle, then (i) if such Vehicle is a Delivery Vehicle, Servicer shall be responsible for obtaining a new Independent Operator to enter into a Transaction for the Delivery Vehicle in question, or funds will be paid to Purchaser from the Reserve Account, or (ii) if such Vehicle is not a Delivery Vehicle, funds will be paid to Purchaser from the Reserve Account.

 

	
  

	
(6)

	
While remarketing the Vehicles, Servicer shall continue to make Expected Payments and the contractual amount for Transactions with fixed payments on the terminated Transaction.

 

	
  

	
(7)

	
When remarketing a Delivery Vehicle, Servicer shall give priority to placing an Independent Operator with the remarketed Vehicle ahead of all other opportunities.

 

	
  

	
(8)

	
When a new Independent Operator is found with respect to a remarketed Vehicle, the Independent Operator shall enter into a new Transaction with Purchaser, as lessor or lender thereunder, for no additional consideration, and Servicer shall deliver all original Transaction Documents evidencing said new Transaction to Purchaser.

 

	
  

	
(d)

	
Servicer agrees to indemnify Purchaser against any damages, claims, costs or expenses (including but not limited to reasonable attorneys’ fees) which may be incurred by Purchaser to the extent they arise out of the negligence or willful misconduct of, or any violations of law by, Servicer in performing any of its duties under this Agreement.

 

	
3.

	
Reporting Requirements. Servicer shall provide to Purchaser the following reports on each Distribution Date (each to be in form and substance reasonably acceptable to Purchaser):

 

	
  

	
(a)

	
Pursuant to Section 2(a)(6), the Lock Box File or similar acceptable report to Purchaser;

 

	
  

	
(b)

	
Delinquency Report sorted by Obligor, for the most recent Reporting Period;

 

	
  

	
(c)

	
All gains and losses on sales of Vehicles for the most recent Reporting Period;

 

  

  

  

 

	
  

	
(d)

	
Outstanding Advance Report listing by Transaction what portions of the most recent Aggregate Monthly Payment constituted Advances and the total outstanding Advances with respect to each Transaction;

 

	
  

	
(e)

	
A Reserve Account report, indicating the amount of the Reserve Account and all additions and subtractions thereto since the prior report;

 

	
  

	
(f)

	
On or before the 5th business day of each month, a data file in electronic form reflecting all gross balances due at the Transaction level in the same format as outlined in Section 3.1(c) of the Portfolio Purchase Agreement;

 

	
  

	
(g)

	
An Idle Truck Report which reflects the Vehicles which are idle at the end of each month and the activity related to idle trucks in such month;

 

	
  

	
(h)

	
A Preventative Maintenance Compliance Report at each month end;

 

	
  

	
(i)

	
Quarterly compliance certificate from the Chief Finance Officer of Servicer certifying as to (i) the continuing accuracy and completeness of the representations and warranties of Servicer under this Agreement, the Program Agreements, the Reserve Account Agreement and the Purchase Agreement, and (ii) the compliance by Servicer with all of its covenants, duties and obligations under such agreements; and

 

	
  

	
(j)

	
Other reports as may be reasonably requested by Purchaser from time to time.

 

	
4.

	
Servicer covenants to:

 

	
  

	
(a)

	
comply with all applicable laws with respect to its activities under this Agreement, including any of its obligations with respect to the Transactions and enforcing any of Purchaser’s rights thereunder;

 

	
  

	
(b)

	
preserve its existence as a corporation and/or limited liability company, as the case may be, duly organized, validly existing and in good standing, under the laws of the State of Delaware;

 

	
  

	
(c)

	
permit inspection/audit by Purchaser or its designees of Servicer’s books and records relating to the Transactions, Payments and other Assigned Property upon reasonable notice during normal business hours at Servicer’s address set forth above, and shall assist Purchaser in connection with such inspections/audits;

 

	
  

	
(d)

	
comply with its obligations under the Transaction Documents;

 

	
  

	
(e)

	
not agree to any amendments or modifications of the Transaction Documents (without the prior written consent of Purchaser) that would (i) change the amount, due date, interest rate or rental rate or prepayment fee, defer or forgive the payment of any principal or interest or rent (including changing the maturity date of a Transaction), (ii) waive any provision of a Transaction (including any change in any time period) prohibiting prepayment in whole or in part, or reduce the outstanding principal amount or imputed principal balance (except for reductions contemplated by the Transaction Documents), (ii) release, or agree to the substitution or exchange of any Collateral for, any portion of the Transaction or Collateral or release the liability of any person or entity liable for any payment on any Transaction, (iii) grant any concession with respect to the compliance with any material obligations imposed by the Transaction Documents, (iv) release the Obligor from any of its obligations to make any payment with respect to any Transaction, or (v) accelerate or extend the maturity date of any Payment, commence any action, terminate any Transaction or repossess and resell any Collateral, or (vi) take any action or fail to take any action which would materially adversely affect the value of any Existing Transactions or Future Transactions, reduce the likelihood of recovery of any Payment or the security of the Transaction.

 

  

  

  

 

	
  

	
(f)

	
not impair the rights or breach the quiet enjoyment of any Obligor under the Transaction Documents,

 

	
  

	
(g)

	
not create any lien, security interest or other encumbrance against any Assigned Property except in favor of Purchaser as may be permitted by Purchaser in writing;

 

	
  

	
(h)

	
comply with its credit and collection policies with respect to the Payments, which policies shall be commercially reasonable and in accordance with applicable laws and with normal policies of similar companies in the equipment finance and leasing industries;

 

	
  

	
(i)

	
pursue the interests of Purchaser in the same manner as it would pursue its own interests in the exercise any remedies available under the Transaction Documents, without discrimination;

 

	
  

	
(j)

	
promptly provide to Purchaser copies of any notices and material information received by Servicer in connection with any Transaction;

 

	
  

	
(k)

	
notify Purchaser monthly of the existence of any default or event of default, or the occurrence of any event which, with notice or lapse of time, or both, would constitute a default or event of default under any Transaction Document of which Servicer has knowledge;

 

	
  

	
(l)

	
provide evidence of insurance for each Transaction pursuant to the Transaction Documents to Purchaser and make claims against any insurance policy relating to the Vehicles in the same manner as it would pursue its own interests, and to promptly remit to Purchaser any insurance proceeds received as a result of such claim; and

 

  

  

  

 

	
  

	
(m)

	
provide to Purchaser copies of its audited yearly financial statements within 120 days after the end of each fiscal year, and such other financial statements and reports as may be reasonably requested by Purchaser from time to time.

 

Servicer further agrees to pay Purchaser interest (after as well as before judgment) on any amounts required to be paid by Servicer to Purchaser hereunder and not paid by Servicer when due hereunder at the rate equal to the highest Discount Rate plus four percent.

 

	
5.

	
Termination of Servicing. Purchaser may, upon written notice to Servicer, terminate the rights and obligations of Servicer set forth in this Agreement, or any portion thereof, and notify the applicable Obligor(s) to make all subsequent Payments directly to Purchaser upon the occurrence of any one of the following:

 

	
  

	
(a)

	
if Servicer shall fail to make any required payment due hereunder and such failure shall continue unremedied for ten (10) business days after notice, or if Servicer shall fail to perform any of its other agreements hereunder in any material respect and such failure shall continue unremedied for thirty (30) days after notice;

 

	
  

	
(b)

	
any material representation or warranty made by Servicer in the Purchase Agreement, any future Portfolio Purchase and Sale Agreements, Program Agreements, the Reserve Account Agreement, or by Servicer in this Agreement shall prove to be false or inaccurate in any material respect if such inaccuracy would have a material adverse effect and such inaccuracy has not been remedied in all material respects within thirty (30) days after written notice;

 

	
  

	
(c)

	
Servicer shall fail to perform any covenant contained in the Purchase Agreement, any future Portfolio Purchase and Sale Agreements, the Reserve Account Agreement or Program Agreements and such failure shall continue unremedied for thirty (30) days (or in the case of a failure to pay money, ten (10) business days) after written notice;

 

	
  

	
(d)

	
Servicer shall suffer a change of ownership of a controlling position of the capital stock, or a sale of all or substantially all of the assets of Servicer to any entity or individual which is not now an affiliate of Servicer;

 

	
  

	
(e)

	
an Event of Bankruptcy shall have occurred with respect to Servicer or any parent company of Servicer; or

 

	
  

	
(f)

	
if Servicer fails to repurchase any Transaction pursuant to Article V of the Purchase Agreement or any future Portfolio Purchase and Sale Agreements, provided however, that in such event, any termination of Servicer as Servicer shall only be with respect to the Transaction related to such Transaction Document and only if Purchaser elects to take over servicing, as opposed to proceeding with the remarketing of the Delivery Vehicle, as referenced above.

 

  

  

  

 

	
6.

	
Upon any termination, as provided, herein, Servicer shall deliver to Purchaser all requested and available information concerning the billing and payment by Servicer hereunder so that Purchaser or Purchaser’s designee may assume such duties and shall otherwise cooperate with Purchaser to accomplish the prompt, effective and smooth transition of servicing to Purchaser or Purchaser’s designee. This will include transfer of automatic deductions generated by Obligors to Purchaser, including lease Payments and Maintenance Fund payments. Servicer shall transfer all funds in its possession in maintenance accounts with respect to Obligors and the Transactions to Purchaser.

 

In the event that this Agreement is terminated, the triggers for funding the Reserve Account will commence (as described in the Reserve Account Agreement) and available funds will be provided to the Purchaser immediately. The Reserve Account will be held until full payout of all Transactions.  The replacement servicer, which may include the Purchaser will earn a reasonable fee to be paid from the Reserve Account.

 

Except as otherwise provided herein or in the Purchase Agreement, any future Portfolio Purchase and Sale Agreements, the Reserve Account Agreement or the Program Agreements, upon such termination of Servicer, Servicer shall be relieved of any further servicing obligations with regard to the Transaction Document for which servicing was terminated. Upon any termination, as provided, herein, Servicer does hereby irrevocably constitute and appoint Purchaser or a new billing and collection agent designated by Purchaser, as its true and lawful attorney with full power of substitution, for it and in its name, place and stead, to enforce, ask, demand, collect, receive, receipt for, sue for, compound and give acquittance for any and all Payments and other obligations with respect to the Transaction(s) for which servicing has been terminated, and to endorse the name of Servicer on all checks, collections, receipts, instruments or notices in connection with any Payments or other obligations.

 

	
7.

	
All notices, requests and demands to or upon the parties hereto shall be deemed to have been given or made when received by the parties at the following addresses, or to such other addresses as may hereafter be designated in writing:

 

	
If to Servicer:

	  
	
Quality Equipment Leasing, LLC

	
Attn: Danny Williams, COO

	
9702 East 30th Street

	
Indianapolis, IN 46229

	
Email: dwilliams@celadontrucking.com

	  
	
If to Purchaser:

	  
	
19th Capital Group, LLC

	
353 West Lancaster Avenue, Suite 300

	
Wayne, Pennsylvania 19087

	
Attn:  Jeffrey R. Larsen

	
Email:  jeff@larsenmaccoll.com

  

  

  

 

	
8.

	
This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware.

 

	
9.

	
This Agreement shall be binding upon the parties hereto and their respective successors and permitted assigns.

 

	
10.

	
Servicer may not assign, sell, or otherwise transfer any of its rights or obligations under this Agreement without Purchaser’s prior written consent. Notwithstanding the foregoing, Servicer acknowledges and agrees that Purchaser may, without prior notice to Servicer, assign any and all of its rights and obligations under this Agreement, including to one or more parties providing financing to Purchaser.

 

	
11.

	
This Agreement may be executed in any number of counterparts, and by different parties hereto on separate counterparts, each of which, when so executed and delivered shall be an original but all such counterparts shall together constitute one and the same instrument.  The parties hereto may deliver executed signature pages to this Agreement by facsimile or electronic mail transmission, such signatures shall be treated as, and have the effect of, an original document.

 

	
12.

	
This Agreement supersedes all previous arrangements and agreements, whether written or oral, and comprises the entire agreement, between the parties hereto in respect of the subject matter hereof.

 

	
13.

	
This Agreement may be amended or varied only by writing, of even or subsequent date hereof, executed by Purchaser and Servicer, or by supplements, as agreed hereto to by the parties.

 

	
14.

	
No course of dealing between Purchaser and Servicer, nor any delay in exercising any rights or remedies hereunder or otherwise shall operate as a waiver of any of the rights and remedies of Purchaser or Servicer.

 

	
15.

	
The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision.

 

	
16.

	
Each of Purchaser and Servicer agrees to execute and deliver promptly to the other all such further instruments and documents as may reasonably be requested by the other in order to carry out fully the intent, and to accomplish the purposes, of the transactions referred to herein.

 

	
17.

	
SERVICER AND PURCHASER WAIVE THEIR RIGHT TO A TRIAL BY JURY WITH RESPECT TO ANY MATTER ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT.

 

  

  

  

 

	
18.

	
The parties hereto agree to the exclusive jurisdiction and venue for any disputes, actions, or proceedings arising hereunder of the United States District Court for the State of Delaware or, if the jurisdictional minimum amount, if any, is not met, then any applicable State Court in the State of Delaware.

 

[Signature Page Follows]

 

  

  

  

 

IN WITNESS WHEREOF, SERVICER and PURCHASER have caused their names to be signed to this Service Agreement by their respective officers hereto duly authorized as of the day and year first above written.

	  	  	
SERVICER:

	  	  	  
	  	  	
QUALITY COMPANIES LLC, formerly dba 

QUALITY EQUIPMENT SALES and 

QUALITY EQUIPMENT LEASING, LLC 

dba QUALITY EQUIPMENT SALES

	  	  	  
	  	  	  
	  	  	
By:

	

/s/ Leslie Tarble

	  	  	
Name:

	
Leslie Tarble

	  	  	
Title:

	
Chief Financial Officer

	  	  	  
	  	  	
PURCHASER:

	  	  	  
	  	  	
19TH CAPITAL GROUP, LLC

	  	  	  
	  	  	  
	  	  	
By:

	

/s/ George Chasteen

	  	  	
Name:

	
George Chasteen

	  	  	
Title:

	
President

Back to Form 10-Qexhibit104.htm

 

Exhibit 10.4

 

PROGRAM AGREEMENT

 

This Program Agreement (this “Agreement”) is entered into as of September 28, 2015, by and between 19th Capital Group, LLC, a Delaware limited liability company with a principal place of business at 353 West Lancaster Avenue, Suite 300, Wayne, Pennsylvania 19087 (“Financing Party”), and Quality Companies, LLC, formerly dba Quality Equipment Sales, an Indiana limited liability company, and Quality Equipment Leasing, LLC, dba Quality Equipment Sales, a Delaware limited liability company, with a principal place of business located at 9702 E. 30th Street, Indianapolis, IN 46229 (hereinafter collectively “Company”).

 

BACKGROUND

 

WHEREAS, Company is engaged in a commercial business that requires truck drivers as independent contractors (collectively, “Independent Contractors”) to utilize one or more trucks and or trailers (“Delivery Vehicles”) meeting Company's requirements and specifications for delivery of certain products for customers;

 

WHEREAS, Financing Party is in the business of leasing equipment to and financing of equipment for commercial business entities, including Delivery Vehicles similar to the vehicles required by Independent Contractors that deliver products for the Company;

 

WHEREAS, Company desires to offer Independent Contractors the opportunity to finance acquisitions of and/or lease Delivery Vehicles and has requested that from time to time Financing Party consider entering into financing agreements and/or leases for the acquisition of and/or lease of Delivery Vehicles with Independent Contractors;

 

WHEREAS, Financing Party has agreed, from time to time and at its sole discretion and in accordance with the terms and conditions of this Agreement, to consider providing such leases and/or financing to Independent Contractors; and

 

WHEREAS, Financing Party has strategically aligned itself to provide Company and Company's Independent Contractors with a combination of high level of service and a comprehensive financing solution.

 

NOW THEREFORE, in consideration of the mutual promises contained herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound, Company and Financing Party hereby agree as follows:

 

SECTION ONE - DEFINITIONS

 

1.1.           “Application” shall have the meaning ascribed to such term in Section 3.1(a) hereof.

 

1.2.           “Independent Contractor(s)” has the meaning given to such term in the Background section hereof.

 

  

  

  

 

1.3.           “Lessee/Borrower” shall have the meaning ascribed to such term in Section 2.1 hereof.

 

1.4.           “Payments” means all payments due and to become due with respect to any Transaction and any related Transaction Documents, together with all end of term rights, residual values of the Vehicles, and payments options.

 

1.5.           “Reserve Account” shall have the meaning ascribed to such term in Section 8.2(a) hereof.

 

1.6.           “Transaction” means each financing agreement and/or lease for the acquisition or lease of a Delivery Vehicle between Financing Party, as lender or lessor, and an Independent Contractor, as lessee or borrower.

 

1.7.           “Transaction Documents” means, with respect to any Transaction, a lease agreement and/or financing agreement for the financing of, acquisition, or lease of Delivery Vehicle(s), as the case may be, by and between Financing Party, as lessor or lender, and Independent Contractors, as lessees or borrowers, together with any financing statements, schedules, insurance certificates, and any and all agreements, titles, instruments and other documents entered into and executed in connection therewith.

 

SECTION TWO - CUSTOMER REFERRALS

 

2.1.           Company may from time to time refer certain of its current or future Independent Contractors who have an interest in procuring lease and/or financing of Delivery Vehicles to Financing Party for consideration of such Independent Contractors as prospective lessees and/or borrowers (such Independent Contractors are hereinafter referred to, collectively, as “Lessees/Borrowers” and each, individually, a “Lessee/Borrower”).  Financing Party reserves the right to accept or decline any prospective Lessee/Borrower as determined by Financing Party in its sole discretion.

 

SECTION THREE - TRANSACTION APPLICATION ORIGINATION

 

3.1.           Credit Review.

 

(a)           Financing Party requires a complete driving record and background check to be conducted on each prospective Lessee/Borrower in accordance with all State and Federal Regulations for over the road delivery for each prospective Lessee/Borrower in order to complete its credit review. For each proposed Transaction application, Company shall provide Financing Party with or otherwise assist Financing Party in obtaining the following: (i) a full and complete description of the Delivery Vehicle subject to the proposed Transaction, including age and mileage of the Vehicle; (ii) the economic terms of the proposed Transaction; (iii) a complete and legible copy of the Transaction application (“Application”); and (iv) all pertinent details and other such credit and financial data as Financing Party may require in an exercise of its sole and absolute discretion, including, without limitation, any background check, driving history, safety records, or criminal record investigation which Company may have obtained.

 

  

2

  

 

(b)           All Lessees/Borrowers shall be required to (i) meet Financing Party’s risk acceptance criteria (“RAC”) as established by Financing Party from time to time, and (ii) execute Financing Party’s form of lease or finance agreement, as the case may be, and all other Transaction Documents required by Financing Party in connection therewith (collectively the “Lease Documents” or “Transaction Documents”). Financing Party may from time to time modify the requirements for credit approval of prospective Lessees/Borrowers on such terms as may be determined by Financing Party in its sole discretion.

 

3.2.           Rate. Financing Party shall offer a lease or finance agreement for each approved Application reflecting its current lease and/or finance interest rate of 12%. Financing Party reserves the right to change the applicable interest rate as the market may dictate upon reasonable notice to the Company.

 

3.3.           Transaction Documentation. Financing Party shall provide the Company with standard lease/finance documents to be used for all Transactions, including amendments and supplements memorializing or otherwise relating to each Transaction. If a Lessee/Borrower requires any deviation from the standard, all such adjustments must be approved in writing by Financing Party. Documents will be signed by the Financing Party in accordance with agreed upon service levels.

 

3.4.           Payments/Billing. The Company shall make monthly payments to the Financing Party for each Transaction in accordance with the Service Agreement by and between Company, as servicer, and Financing Party, as financing party and/or purchaser, of even date herewith (the “Service Agreement”).

 

SECTION FOUR - ACCEPTANCE OF TRANSACTIONS

 

4.1.           Conditions Precedent to Accept a Transaction. The agreement of Financing Party to accept any Transaction hereunder shall be subject to the satisfaction of the following conditions precedent, which conditions may change from time to time in Financing Party’s sole discretion:

 

(a)           Financing Party’s receipt of all required credit information and all Transaction Documents, duly executed by the Lessee/Borrower as may be deemed necessary by Financing Party in its sole and absolute discretion;

 

(b)           Financing Party’s confirmation that the Lessee/Borrower has accepted the Delivery Vehicle subject to the requested Transaction;

 

(c)           Financing Party’s credit approval for the Lessee/Borrower;

 

(d)           Financing Party’s receipt of a bill of sale based upon agreed upon pricing for the Delivery Vehicle (as described in Section 4.3 below), which bill of sale shall sufficiently describe the Delivery Vehicle (including, without limitation, the make, model, and vehicle identification number and overall price for the Delivery Vehicle), and will also include details on any warranty costs or accessories and additional items of equipment (“Add-Ons”) related to the Delivery Vehicle. The form of such bill of sale shall be determined by Financing Party in the exercise of its sole and absolute discretion; and

 

  

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(e)           Financing Party’s receipt of such other information and documentation as may be reasonably required by Financing Party.

 

4.2.           Funding.  Funding for one or more Transactions by Financing Party (including the purchase of one or more Transactions by Financing Party from the Company) shall take place from time to time, as determined by Financing Party and the Company.  Upon funding of a Transaction, the Company shall title the applicable Delivery Vehicle(s) in the name of Financing Party or its designated agent.  As part of its responsibilities as Servicer under the Service Agreement, the Company shall assist in the delivery of the Delivery Vehicle to the Independent Contractor concurrent with the Independent Contractor entering into the Transaction. The Financing Party shall provide a Limited Power of Attorney for the purposes of titling the Delivery Vehicles.

 

4.3.           Pricing.  The pricing for each Delivery Vehicle shall be determined by Financing Party and the Company from time to time.

 

SECTION FIVE - REPRESENTATIONS, WARRANTIES AND COVENANTS

 

5.1.           Mutual Representations and Warranties. Financing Party and Company each represents and warrants to the other as follows:

 

(a)           The execution and delivery of this Agreement and the performance by it of the transactions contemplated hereby have been duly authorized by all necessary corporate action, and this Agreement constitutes a legal, valid and binding obligation enforceable in accordance with its terms; and

 

(b)           It has all governmental approvals, permits, certificates, inspections, consents and franchises necessary to conduct its respective business, substantially as now conducted and to own or finance and operate its properties as now owned, financed or operated by it, except where the failure to obtain any of the foregoing does not materially and adversely impair the ability of each to operate its business or to perform its obligations under this Agreement.

 

5.2.           Representations and Warranties of Company. Company represents and warrants to Financing Party that as of the date each Transaction is submitted for approval to Financing Party as follows:

 

(a)           Company is a duly organized and validly existing corporation and/or limited liability company, as the case may be, and has full power to enter into this Agreement and to carry out the transactions contemplated hereby and is in good standing in the state of its organization, as set forth in the Preamble of this Agreement.

 

(b)           There are no other agreements between Company and the Lessee/Borrower or any guarantor, which will modify, amend or waive any terms or conditions of any Transaction. There are no express or implied warranties or representations made by Company or its employees, affiliates, subsidiaries, directors, officers, members, shareholders, and/or contractors (collectively, “Representatives”) to the Lessee/Borrower. Lessee/Borrower enters into the Transaction in reliance on the manufacturer’s standard warranty only, to the extent, where the Delivery Vehicle may be a used vehicle, the warranty is still in force and effect.

 

  

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(c)           Company and its representatives have not committed any fraudulent act or participated in any fraudulent act or activity in connection with the execution, delivery of the Transaction Documents or the performance of this Agreement.

 

(d)           Ownership of the Delivery Vehicle shall be vested in Financing Party or its affiliate upon its purchase of the vehicle, free and clear of any and all liens and encumbrances whatsoever and such sale shall vest Financing Party or its affiliate with full, complete and unencumbered title to the Vehicle. If the leased/financed Delivery Vehicle is not a new vehicle, the Company shall assist the Financing Party in transferring title to the Delivery Vehicle to Financing Party or its agent and specify, for purposes of the Transaction documents, the age and mileage of the Delivery Vehicle in question.

 

(e)           To the best of Company’s knowledge, all credit information concerning the Lessee/Borrower given to Company and relative to Financing Party’s evaluation of such Application, has been disclosed to Financing Party (including information of any fact or circumstance which would constitute a default under a Transaction), and Company has not altered or withheld any credit information concerning the Lessee/Borrower given to Company and relative to Financing Party’s evaluation of such Application.

 

(f)           Independent Contractors referred to Financing Party by Company will be seeking to lease/finance Class VIII tractors from major manufacturers.

 

(g)           To the best of Company’s knowledge, Company’s conduct in soliciting or arranging any Transaction has not violated in any material respect any federal or state law, rule, or regulation, which will result in the rescission of any Transaction.

 

(h)           Company will not take any action or omit to take any action, which will cause the Transaction or any related document to become invalid, cancelable, or unenforceable, excepting the remarketing of the associated Delivery Vehicle pursuant to the terms of the Service Agreement, where warranted.

 

(i)           Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement by the Company, conflict with or result in a breach of or a default under any of the terms, conditions or provisions of any legal restriction (including, without limitation, any judgment, order, injunction, decree or ruling of any court or governmental authority, or any federal, state, local or other law, statute, rule or regulation) or any covenant, agreement or instrument to which the Company is a party, or by which the Company or any of the Company’s property is bound (including, without limitation, any agreement or other financing arrangement between the Company and Element Financial Corp.).

 

(j)           Each Transaction Document is in full force and effect, and there are no claims, suits, actions, arbitrations or other proceedings or governmental investigations, including, without limitation, any counterclaims or claims by any Lessee/Borrower, pending, or, to the best of the Company’s knowledge, threatened, against the Company relating to any Transaction or the acquisition, collection or administration of any Transaction.  The Company has not received any notice of, nor to the best of the Company’s knowledge, is there any valid basis for any claim against, or assertion of liability against, the Company relating to any Transaction, or the acquisition, collection or administration thereof.  At the time of the purchase and/or funding of each Transaction by Financing Party, there are no claims, suits, actions, arbitrations or other proceedings or governmental investigations pending, or, to the best of the Company’s knowledge, threatened, against the applicable Lessee/Borrower or any related Delivery Vehicle.

 

  

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(k)           All information, in whatever form provided by Company to Financing Party concerning the Lessees/Borrowers, the Transactions and the Delivery Vehicles related thereto, including, without limitation: (i) the legal names and addresses of Lessees/Borrowers, (ii) the amount, due dates and monthly payment stream of payments due under Transaction Documents, as applicable (iii) variable payment rates and fixed price purchase options due under the Transaction Documents, as applicable, (iv) descriptions of Transaction Documents, (v) stated residual values, (vi) cash flows, (vii) delinquencies, and (viii) the amount of any security deposits, advance payments or other collateral held by Company as security for Transaction obligations, has been provided with the knowledge that Financing Party has been induced to enter into this Agreement on the terms agreed upon in reliance on such information, and Company warrants that all such information is accurate and correct in all material respects and that Company has not withheld any material adverse information.

 

5.3.           Representations and Warranties of Financing Party. Financing Party represents and warrants to Company that as of the date each Transaction is accepted by Financing Party and thereafter as follows:

 

(a)           Financing Party is a duly organized and validly existing limited liability company and has full power to enter into this Agreement and to carry out the transactions contemplated hereby, and is in good standing in the state of its organization, as set forth in the Preamble to this Agreement.

 

(b)           Financing Party and its agents and employees have not committed and will not commit to any fraudulent act or have not participated and will not participate in any fraudulent act or activity in connection with the execution of the Transactions or this Agreement.

 

(c)           The conduct of Financing Party in processing any Application, including the granting or denial of credit, whether in Financing Party’s name or the name of Company, has not violated and will not violate in any material respect any federal or state law, rule or regulation.

 

5.4.           Affirmative Covenants of Company.

 

(a)           From the date hereof until the date on which all obligations of Lessees/Borrowers under all Transactions have been fully paid and otherwise discharged or this Agreement terminated, the Company shall provide such financial information and reports as Financing Party may reasonably request from time to time.

 

(b)           Company will promptly fulfill and perform all obligations, covenants, liabilities, warranties and duties, if any, on its part to be fulfilled and performed in connection with a Transaction and any other agreements or instruments executed by Company with respect to the maintenance or servicing by Company of the Delivery Vehicle subject to a Transaction. Financing Party and/or any subsequent assignee of Financing Party shall have no obligation or liability with respect to the maintenance or servicing of the Delivery Vehicle subject to a Transaction and shall not be obligated to perform any of Company’s obligations thereunder. Company’s obligations under a Transaction may be performed by Financing Party or any subsequent assignee, however, without releasing Company therefrom.

 

  

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(c)           Company shall maintain the Delivery Vehicles that are the subject of the Transactions through use of a maintenance fund paid into by each Lessee/Borrower and, where necessary, through use of its own funds, in accord with the Service Agreement.

 

(d)           Company will obtain and provide to Financing Party proof of insurance from each new Lessee/Borrower with respect to the Delivery Vehicle subject to each Transaction, and make certain that Financing Party is the beneficiary of the insurance as owner pursuant to the terms of the Service Agreement.

 

(e)           If a Transaction goes into default due to the loss of an Independent Contractor/driver, Company shall repossess and recondition the Delivery Vehicle subject to the Transaction utilizing any maintenance funds obtained from the prior driver and its own funds, if necessary, and place a new Independent Contractor/driver in the Delivery Vehicle subject to a new Transaction in accordance with the Service Agreement. Placement of an Independent Contractor in a Delivery Vehicle which has been repossessed due to default shall be a priority for Company in accord with the provisions of the Service Agreement.

 

(f)           The Company may from time to time enter into Sponsorship Agreements with certain delivery companies by which the Company provides certain Independent Contractors of such delivery companies with lease/finance options for Delivery Vehicles. The Company shall use commercially reasonable efforts to pursue and enforce its rights and benefits under such Sponsorship Agreements, and upon request of Financing Party, the Company shall assign the Sponsorship Agreements to the attention of and for the benefit of Financing Party.

 

(g)           For the term of any Transaction, Company shall make all reasonable efforts to advise Financing Party of any matter of which Company has knowledge that may be materially detrimental to a Lessee/Borrower’s financial condition.

 

(h)           So long as this Agreement is in effect, Company will notify Financing Party of any change in the persons authorized to represent Company in the transactions contemplated hereby and in the event of any such change will provide Financing Party with updated evidence of authority and specimen signatures for each individual.

 

SECTION SIX - TRANSACTION SERVICING

 

6.1.           Servicing of Transactions. Company shall, pursuant to the Service Agreement, provide general administrative services, including billing and collecting all Payments, fulfilling the obligations as lender, lessor and/or owner, as the case may be, under the Transactions, the enforcement of Financing Party’s rights under the Transaction Documents and/or this Agreement and the taking of such other actions that may be necessary to protect Financing Party’s rights and interest in and to the Transactions and/or the Delivery Vehicles in accord with the Service Agreement.

 

  

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SECTION SEVEN - REPURCHASE OF TRANSACTIONS

 

7.1.           Breach of Transaction.

 

(a)           If Company has committed a material breach of any of its representations, warranties and/or covenants contained in this Agreement and, as a result of such breach, a Transaction becomes in default, provided that the breach is curable, then Company shall have ten (10) days (the “Cure Period”) after receipt of Notice to Cure from Financing Party (a “Notice to Cure”) to cure such breach. If Company fails to cure such breach in accordance with the terms of this Section 7.1, or if the breach is not curable, then Company shall repurchase from Financing Party such Transaction, within five (5) business days of the receipt of a request to repurchase such Transaction from Financing Party for an amount determined as follows:

 

(i)           An amount equal to the sum of (i) the aggregate amount of all amounts presently due with respect to the applicable Transaction, plus (ii) all future unpaid Payments to be made under the Transaction until the expiration of the initial term of the Transaction, plus (iii) the purchase option or booked residual value for the Delivery Vehicle at the end of the initial term of the Transaction with all accelerated Payments and the purchase option or booked residual for the Delivery Vehicle discounted at the interest rate for such Transaction.

 

(ii)           The amounts set forth in subparagraph (a) above shall be referred to as “Unrecovered Investment.” Upon receipt of the Unrecovered Investment, Financing Party or, if applicable, its assignee, shall assign to Company all of its rights, title and interest of Financing Party in and to such Transaction, any related documents, the Delivery Vehicle and the Payments, free of all liens, encumbrances or interest arising through Financing Party.

 

(b)           The parties acknowledge and that Company’s repurchase obligations pursuant to this Section 7.1 are not subject to the recourse obligations (and the limitations thereon) of Company pursuant to Section 8.2 and 8.3 below.

 

SECTION EIGHT - INDEMNIFICATION, RESERVE ACCOUNT, REMARKETING

 

8.1.           Indemnification.

 

(a)           Company agrees to indemnify and hold harmless Financing Party and its affiliates, subsidiaries, employees, directors, officers, members, shareholders, and agents, and any participant from any and all losses, claims, liabilities, demands and expenses (“Losses”) whatsoever (including without limitation reasonable attorneys’ fees) arising in connection with or in any way related to (i) the breach of any of Company’s covenants, warranties and representations in this Agreement, (ii) delivery by Company of any inaccurate or misleading credit information concerning any Lessee/Borrower and/or in connection with any Application to Financing Party, regardless of whether such inaccurate or misleading information was deliberately submitted to Company or was a result of an inadvertent error in the submission and/or processing of any Application, and/or (iii) any claim, losses or liabilities related to any Transaction or any Delivery Vehicle(s) related thereto.

 

(b)           Financing Party agrees to indemnify and hold harmless Company, including any attorneys’ fees incurred, and their respective current and future successors, assigns (where permitted), affiliates, subsidiaries, employees, directors, officers, members, shareholders, and agents, and any participants from any Losses sustained by Company in connection with or in any way related to any breach by Financing Party of its representations or warranties in this Agreement.

 

  

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(c)           All obligations under this Section 8.1 shall survive any expiration or termination of this Agreement and the termination of any Transaction, but in no event longer than the applicable statute of limitations.

 

8.2.           Reserve Account.

 

(a)           To provide recourse to Financing Party for losses that Financing Party may incur in connection with the Transactions, Company shall allocate for each Transaction approved and funded pursuant to this Agreement 10% of the overall cost of the associated Delivery Vehicle into a reserve account (“Reserve Account”) pursuant to the terms of the Reserve Account Agreement executed between the parties on even date herewith (the “Reserve Account Agreement”). Company shall maintain the Reserve Account pursuant to the terms of the Reserve Account Agreement until such time as it shall be terminated or end by its own terms.

 

(b)           Company shall keep a complete and accurate accounting with respect to the Reserve Account. The Company shall furnish to the Financing Party written monthly reports setting forth information concerning amounts accrued to and paid out of the Reserve Account and the balance of the Reserve Account, together with such additional information as may be requested by Financing Party in its reasonable discretion.

 

(c)           The obligations of the parties with respect to the Reserve Account and the recovery and remarketing of Delivery Vehicles pursuant to this Agreement, the Reserve Account Agreement, and/or the Service Agreement, shall survive the termination of this Agreement until such time as any Transactions entered into and financed by Financing Party pursuant to this Agreement have fully matured and been paid in full and satisfied.

 

8.3.           Recovery and Remarketing.

 

(a)           Upon the occurrence of a default or an event of default pursuant to the terms of any Transaction Documents (“Event of Default”) applicable to a Transaction (each such Transaction is hereafter referred to as a “Defaulted Transaction”), Company will, in good faith, pursue the recovery of the Delivery Vehicle subject to a Defaulted Transaction pursuant to the terms of the Service Agreement.

 

(b)           In the event the Delivery Vehicle subject to a Defaulted Transaction is successfully remarketed following a voluntary surrender to or successful repossession by Company, the proceeds of the sale of the Delivery Vehicle shall be distributed in accord with the terms of the Service Agreement.

 

SECTION NINE - GENERAL PROVISIONS

 

9.1.           Independent Parties. Financing Party and Company are separate entities, which have entered into this Agreement for independent business reasons. Neither Financing Party nor Company has acted, act, or shall be deemed to have acted or act, as an agent for the other, except with respect to those acts of Financing Party specifically permitted to be taken and actually taken pursuant to and in accordance with the terms hereunder.

 

  

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9.2.           Term and Termination. The initial term of this Agreement is three (3) years from the date of this Agreement (the “Initial Term”). Upon the expiration of the Initial Term, this Agreement shall automatically renew for successive one (1) year terms, unless terminated in accordance with the terms hereof. Notwithstanding the generality of the foregoing, Financing Party may, at its election, immediately terminate the Agreement in the event Company fails to comply with any of the representations, warranties and/or covenants set forth herein. Upon expiration of the Initial Term, Financing Party and/or Company may terminate this Agreement at any time by giving the other at least ninety (90) days written notice of such termination, whereupon the obligations of the parties with respect to Transactions not accepted prior to the expiration of such period shall terminate to the extent the same have not been performed or are not required to have been performed prior to such termination.

 

9.3.           Accounting. Financing Party and Company shall cooperate with each other by furnishing, subject to each party’s then-current internal policies, such records and supporting material relating to Payments under this Agreement or Payments under the Transactions as may be reasonably requested in the event either party is audited by any taxing authority and as is required by the Service Agreement.

 

9.4.           Assignability. Company may not assign, sell, or otherwise transfer any of its rights or obligations under this Agreement without Financing Party’s prior written consent. Financing Party may not assign this Agreement prospectively without notice to Company and prior written consent, which will not be unreasonably withheld. Notwithstanding the foregoing, Company acknowledges and agrees that the Financing Party may however: (a) assign any and all of its rights and obligations, including, without limitations, any Transactions entered into pursuant hereto, under this Agreement to a third party (hereinafter the “Assignee”), and (b) release any and all information received by Financing Party pursuant to this Agreement, including without limitation, any confidential documents or information that may have been received by Financing Party from Company, to such Assignee.

 

9.5.           Notices. Notices under this Agreement shall be deemed to have been given if mailed, postage prepared by U.S. First Class mail or by facsimile or email to the other party at the address stated below or such other address as such party may have provided by written notice.

 

	
If to Company:

	  
	
Quality Equipment Leasing, LLC

	
Attn: Danny Williams, COO

	
9702 East 30th Street

	
Indianapolis, IN 46229

	
Email: dwilliams@celadontrucking.com

 

  

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If to Financing Party:

	  
	
19th Capital Group, LLC

	
353 West Lancaster Avenue, Suite 300

	
Wayne, Pennsylvania 19087

	
Attn:  Jeffrey R. Larsen

	
Email:  jeff@larsenmaccoll.com

 

9.6.           Miscellaneous.

 

(a)           Paragraph headings appearing in this Agreement are for convenience of reference only and shall not modify, define, expand or limit any of the terms or provisions hereof. The parties agree that this Agreement has been executed and delivered in, and shall be construed in accordance with the laws of the State of Delaware.

 

(b)           If, at any time, any provisions of this Agreement shall be held by any court of competent jurisdiction to be illegal, void or unenforceable, such provision shall be of no force and effect, but the illegality or unenforceability of such provision shall have no effect upon and shall not impair the enforceability of any provision of this Agreement.

 

(c)           This Agreement constitutes the entire agreement between the parties concerning the subject matter hereof and incorporates all representations made in connection with negotiation of the same. The terms hereof may not be amended or modified orally, but only by written agreement duly executed by each of the parties, or by supplements hereto as agreed to by the parties.

 

(d)           This Agreement and any amendments hereto shall be binding on and inure to the benefit of the parties hereto and their respective permitted successors and assigns.

 

(e)           This Agreement may be executed by one or more parties on any number of separate counterparts each of which counterparts shall be an original, but all of which when together shall be deemed to constitute one and the same instrument.  The parties hereto may deliver executed signature pages to this Agreement by facsimile or electronic mail transmission, such signatures shall be treated as, and have the effect of, an original document.

 

9.7.           Jurisdiction and Venue. The parties hereto agree to the exclusive jurisdiction of the United States District Court for the State of Delaware or, if the jurisdictional minimum amount, if any, is not met, the state courts of the State of Delaware in any and all disputes, actions, or proceedings arising hereunder.

 

9.8.           Waiver of Jury Trial. The parties hereto (by acceptance of this Agreement) mutually hereby knowingly, voluntarily, and intentionally waive the right to a trial by jury in respect to any claim based hereon, arising out of, under or in connection with this Agreement or any other agreements or documents executed or contemplated to be executed in connection herewith, or any course of conduct, course of dealings, statements (whether verbal or written) or actions of any party, including, without limitation, any course of conduct, course of dealings, statements or actions of Financing Party, or any of its successors and assigns, relating to the administration or enforcement of the Transactions (collectively, “Actions” and singularly, an “Action”). Further, the parties hereto agree that in the event either party commences an Action, the losing party shall pay the costs and expenses, including, but not limited to, attorneys’ fees, incurred the prevailing party in prosecuting or defending, as the case may be, such Action.

 

 

[Signature Page Follows]

 

  

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IN WITNESS HEREOF, intending to be legally bound, the parties hereto have caused their duly authorized representatives to execute this Program Agreement on the date first set forth above.

	  	  	
19TH CAPITAL GROUP, LLC

	  	  	  
	  	  	  
	  	  	
BY:

	

/s/ George Chasteen

	  	  	
PRINT NAME: George Chasteen

	  	  	
TITLE: President

	  	  	  
	  	  	
QUALITY COMPANIES LLC, formerly 

dba QUALITY EQUIPMENT SALES and 

QUALITY EQUIPMENT LEASING, LLC, 

dba QUALITY EQUIPMENT SALES

	  	  	  
	  	  	  
	  	  	
BY:

	

/s/ Leslie Tarble

	  	  	
PRINT NAME: Leslie Tarble

	  	  	
TITLE: Chief Financial Officer

	  	  	  

Back to Form 10-Q

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