FIFTH AMENDMENT TO CREDIT AND SECURITY AGREEMENT

 

 

This FIFTH AMENDMENT TO CREDIT AND SECURITY AGREEMENT (this “Fifth Amendment”) is entered into as of December 3, 2014, to be effective for all purposes as of the Fifth Amendment Effective Date (as defined below), by and among the following:  (i) WELLS FARGO BANK, NATIONAL ASSOCIATION (the “Lender”), (ii) SOUTHERN FRAC, LLC, a Texas limited liability company (the “Borrower”), (iii) GENERAL FINANCE CORPORATION, a Delaware corporation (“GFN”), and (iv) GFN MANUFACTURING CORPORATION, a Delaware corporation (“GFN Mfg” and, together with GFN, the “Guarantors”) (the Borrower and the Guarantors shall be collectively referred to herein as the “Loan Parties”).

 

 

Reference is made to the following:

 

A.

Lender, Borrower and Guarantors have entered into that certain Credit and Security Agreement, dated as of October 1, 2012, as amended by the following:  (1) that certain First Amendment to Credit and Security Agreement, dated as of February 22, 2013, (2) that certain Second Amendment to Credit and Security Agreement, dated as of June 26, 2013, (3) that certain Fifth Amendment to Credit and Security Agreement, dated as of September 5, 2013, and (4) that certain Fourth Amendment to Credit and Security Agreement, dated as of June 10, 2014 (as so amended, the “Credit Agreement”).

 

B.

Borrower has notified Lender (i) that GFN has created a new Subsidiary--GFN Realty Company, a Delaware limited liability company (“GFN Realty”), and (ii) GFN Realty shall acquire on or about the Fifth Amendment Effective Date all of GFN Mfg’s right, title and interest in the Borrower’s New Facility located at 1805 Howard Road, Waxahachie, Texas.

 

C.

Borrower desires to amend the Credit Agreement, including the schedules and exhibits thereto, and take such further actions as are necessary to (1) reflect the formation of GFN Realty,  (2) provide for the conveyance of the New Facility to GFN Realty, and (3) assure the eligibility of Inventory situated at the New Facility from and after the transfer thereof to GFN Realty.

 

D.

Subject to the terms, conditions and limitations set forth herein, Lender is willing to accommodate Borrower’s and Guarantors’ requests.

 

 

NOW, THEREFORE, in consideration of the premises herein contained and other good and valuable consideration, the sufficiency of which is hereby acknowledged, the Lender and the Loan Parties, intending to be legally bound, agree to the accuracy and completeness of the above Recitals, and further agree as follows:

 

1.           DEFINITIONS.  All capitalized terms used but not otherwise defined in this Fifth Amendment shall have the meanings ascribed to them in the Credit Agreement.

 

2.           AMENDMENTS TO CREDIT AGREEMENT.

 

a.           As of the Fifth Amendment Effective Date, the definition of “New Facility” set forth in Schedule 1.1 to the Credit Agreement is hereby amended and restated to read in its entirety, as follows:

“‘New Facility’ means (i) the real property owned by GFN Realty Company, a Delaware limited liability company (hereinafter “GFN Realty”) located at 1805 Howard Road, Waxahachie, Texas consisting of approximately 7.448 acres, (ii) the real property leased by Borrower located at 1801 Howard Road, Waxahachie, Texas consisting of approximately 3.7 acres, and (iii) the real property leased by Borrower located at 1803 Howard Road, Waxahachie, Texas consisting of approximately 3.7 acres.”

b.           As of the Fifth Amendment Effective Date, Section 7.12(g) is hereby amended and restated to read in its entirety as follows:

“(g)          the payment of lease payments to GFN Realty (as defined in the definition of New Facility) in an amount equivalent to amounts owing to any third-party financing source that has advanced money to GFN Mfg. to enter into a Permitted Real Property Acquisition and which debt was assumed by GFN Realty in connection with the transfer of the New Facility to GFN Realty, to the extent such third-party financing source shall have delivered to Borrower and Lender such subordination, non-disturbance and attornment agreements as Lender may require.”

c.           As of the Fifth Amendment Effective Date, each of (i) Schedules 5.1(c), 5.17, 5.19, 5.26(a), and 5.29 to the Information Certificate are hereby amended and restated and shall be replaced, respectively, with Revised Schedules 5.1(c), 5.17, 5.19, 5.26(a), and 5.29 to the Information Certificate, and (ii) Schedule R-1 to the Credit Agreement is hereby replaced with Revised Schedule R-1, in each case, in the forms attached hereto and incorporated herein.

3.           CONDITIONS PRECEDENT TO EFFECTIVENESS OF FIFTH AMENDMENT.  The effectiveness of this Fifth Amendment is subject to the full satisfaction of the following conditions precedent on or before 5:00 pm CST, December 3, 2014, unless specifically waived or extended in writing by Lender:

3.1.           Lender shall have received this Fifth Amendment, duly executed by Borrower and each Guarantor, and Lender shall have duly executed the same.

 

3.2.           Lender shall be satisfied with all corporate proceedings taken in connection with the transactions contemplated by this Fifth Amendment and all documents, instruments and other legal matters incident thereto shall be satisfactory to Lender and its legal counsel.

 

3.3.           The representations and warranties contained herein and in the Credit Agreement and the other Loan Documents shall be true and correct on and as of the Fifth Amendment Effective Date and the date on which all conditions precedent hereunder are satisfied, except to the extent that any such representations or warranties relate to an earlier specific date or dates.

 

3.4.           No Default or Event of Default under the Credit Agreement or the other Loan Documents shall have occurred and be continuing, unless such Default or Event of Default has been specifically waived in writing by Lender.

 

3.5.           Lender shall have received each of the following in form and substance acceptable to Lender in its sole discretion and dated as of November 4, 2014 (the “Fifth Amendment Effective Date”):  (a) a Mortgagee’s Disclaimer and Consent, duly executed and notarized on behalf of Citizens National Bank of Texas (the “Real Estate Lender”) with respect to the New Facility financed by such institution;  (b) a Landlord’s Disclaimer and Consent, duly executed and notarized on behalf of GFN Realty with respect to the New Facility acquired by such Person;  and (c) a Subordination Agreement with the Real Estate Lender.

 

4.           ACKNOWLEDGEMENT OF GUARANTORS.

 

4.1.           GFN Reaffirmation.  GFN hereby acknowledges and agrees that the Credit Agreement, the GFN Guaranty, and the GFN Subordination Agreement are in full force and effect and continue to be the valid, legal and binding obligation of GFN to the extent GFN is a party thereto, and (b) he obligations arising thereunder are without offset or reduction.  GFN hereby (x) consents to the terms of this Fifth Amendment and agrees that nothing herein shall impair in any way its obligations under the Credit Agreement, the GFN Guaranty, or the GFN Subordination Agreement and (y) reaffirms each of its representations, warranties, covenants, guarantees and other agreements set forth in the Credit Agreement, the GFN Guaranty, and the GFN Subordination Agreement.

 

4.2.           GFN Mfg Reaffirmation.  GFN Mfg hereby acknowledges and agrees that (a) the Credit Agreement, the GFN Mfg Guaranty, the GFN Mfg Security Agreement, and the GFN Mfg. Subordination Agreement are in full force and effect and continue to be the valid, legal and binding obligation of GFN Mfg to the extent GFN Mfg is a party thereto, and (b) the obligations arising thereunder are without offset or reduction.  GFN Mfg hereby (x) consents to the terms of this Fifth Amendment and agrees that nothing herein shall impair in any way its obligations under the Credit Agreement, the GFN Mfg Guaranty, the GFN Mfg Security Agreement, or the GFN Mfg. Subordination Agreement and (y) reaffirms each of its representations, warranties, covenants, guarantees and other agreements set forth in the Credit Agreement, the GFN Mfg Guaranty, the GFN Mfg Security Agreement, and the GFN Mfg. Subordination Agreement.

 

5.           ADDITIONAL COVENANTS; RATIFICATIONS; REPRESENTATIONS AND WARRANTIES.

 

5.1.           The terms and provisions set forth in this Fifth Amendment shall supersede all inconsistent terms and provisions set forth in the Credit Agreement and, except as expressly set forth in this Fifth Amendment, the terms and provisions of the Credit Agreement are ratified and confirmed and shall continue in full force and effect.  The parties hereto agree that the Credit Agreement shall continue to be legal, valid, binding and enforceable in accordance with its terms, and this Fifth Amendment constitutes a Loan Document for all purposes.

 

5.2.           Each of the Loan Parties hereby represents and warrants to Lender as to itself:

 

(a)           the execution, delivery and performance of this Fifth Amendment and any and all other agreements executed and/or delivered in connection herewith or therewith have been authorized by all requisite action on the part of such Loan Party and its directors and shareholders, and will not violate the Governing Documents of such Loan Party;

 

(b)           the representations and warranties contained in this Fifth Amendment and the Credit Agreement are true and correct on and as of the date hereof as though made on and as of such date, except to the extent that breaches thereof are specifically waived by this Fifth Amendment;

 

(c)           no Default or Event of Default has occurred and is continuing;

 

(d)           such Loan Party is in full compliance with all covenants and agreements contained in the Credit Agreement (and the Loan Documents);

 

(e)           the consummation of this Fifth Amendment will not (i) violate any provision of the organizational documents or governing instruments; (ii) violate any judgment, order, ruling, injunction, decree or award of any court, administrative agency or governmental body against, or binding upon, such Loan Party; or (iii) constitute a violation by such Loan Party of any law or regulation of any jurisdiction applicable to such Loan Party;

 

(f)           this Fifth Amendment was reviewed by such Loan Party, which acknowledges and agrees that such Loan Party (i) understands fully the terms of this Fifth Amendment and the consequences of the issuance hereof, (ii) has been afforded an opportunity to have this Fifth Amendment reviewed by, and to discuss this Fifth Amendment with, such attorneys and other Persons as Borrower may wish, and (iii) has entered into this Fifth Amendment of its own free will and accord and without threat or duress; and

 

(g)           this Fifth Amendment and all information furnished to Lender is made and furnished in good faith, for value and valuable consideration; and this Fifth Amendment has not been made or induced by any fraud, duress or undue influence exercised by Lender or any other Person.

 

6.           MISCELLANEOUS.

 

6.1.           Misrepresentation.  Borrower shall indemnify and hold Lender (and each of its officers, agents, employees, affiliates, and representatives) harmless from and against any losses, damages, costs and expenses (including attorneys’ fees) incurred by Lender as a direct or indirect result of (a) any breach of any representation or warranty contained in this Fifth Amendment, or (b) any breach or default under any of the covenants or agreements contained in this Fifth Amendment.

 

6.2.           Covenants and Agreements.  Borrower hereby agrees and acknowledges that it is, well and truly indebted to Lender pursuant to the terms of the Loan Documents and hereby agrees to observe, comply with and perform all of the obligations, terms and conditions under or in connection with the Loan Documents.

 

6.3.           Ratification of Liens and Security Interests.  Each of the Loan Parties hereby acknowledges and agrees that the liens and security interests of Lender, as more fully described in Credit Agreement and the other Loan Documents, are valid and subsisting liens and security interests and are superior to all liens and security interests other than those exceptions approved by Lender in writing and as otherwise permitted under the Credit Agreement.

 

6.4.           No Waiver.  Each of the Loan Parties agrees that nothing contained in this Fifth Amendment shall affect or impair the validity or priority of the liens and security interests under any of the Loan Documents.  Lender further reserves all of its rights under Loan Documents, except as expressly modified herein.

 

6.5.           Survival of Representations and Warranties.  Except as provided otherwise in this Fifth Amendment, all representations and warranties made in the Credit Agreement and the other Loan Documents including, without limitation, any document furnished in connection with this Fifth Amendment, shall survive the execution and delivery of this Fifth Amendment, and no investigation by Lender or any closing shall affect the representations and warranties or the right of Lender to rely upon them.

 

6.6.           Reference to Credit Agreement.  Each of the Loan Documents and the Credit Agreement and any and all other agreements, documents or instruments now or hereafter executed and delivered pursuant to the terms hereof or pursuant to the terms of the Credit Agreement as amended hereby, are hereby amended so that any reference in such Loan Documents to the Credit Agreement shall mean a reference to the Credit Agreement as amended hereby.

6.7.           Expenses of Lender.  Borrower agrees to pay on demand all costs and expenses incurred by Lender in connection with the preparation, negotiation and execution of this Fifth Amendment and any other agreements executed pursuant hereto, including, without limitation, the reasonable costs and fees of Lender’s legal counsel.  Borrower acknowledges that Lender may debit Borrower’s account to pay such costs and expenses without further consent of, or notice, to Borrower.  Further, Borrower acknowledges that, at the execution and delivery of this Fifth Amendment, Lender may debit Borrower’s account to pay costs and expenses, including Lender’s attorneys’ fees, incurred at such time.

 

6.8.           Severability.  Any provision of this Fifth Amendment held by a court of competent jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder of this Fifth Amendment, and the effect thereof shall be confined to the provision so held to be invalid or unenforceable.

 

6.9.           Successors and Assigns.  This Fifth Amendment will inure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns.

 

6.10.           Headings.  The headings of the sections and subsections of this Fifth Amendment are inserted for convenience only and do not constitute a part of this Fifth Amendment.

 

6.11.           Counterparts.  This Fifth Amendment may be executed in counterparts, and when so executed each counterpart shall be deemed to be an original, and said counterparts together shall constitute one and the same instrument.  However, no party shall be required to exhibit or prove all counterparts of the original agreement to make proof of same, rather each counterpart shall constitute an enforceable agreement against the party who has executed the same.

 

6.12.           Facsimile and Electronic Execution. This Fifth Amendment may be executed and delivered by facsimile or other electronic transmission, and the production of a facsimile counterpart shall have the same force and effect as production of an originally executed counterpart for all purposes.

 

6.13.           No Commitment.  Each of the Loan Parties agrees that Lender has not made any commitment or other agreement regarding further amendment the Credit Agreement or the other Loan Documents.  Each of the Loan Parties warrants and represents that none of the Loan Parties has, and none of the Loan Parties will, rely on any commitment or other agreement on the part of Lender unless such commitment or agreement is in writing and signed by Lender.

 

6.14.           Survival.  All representations, warranties, covenants and agreements of the parties made in this Fifth Amendment shall survive the execution and delivery hereof, until such time as all of the obligations of the parties hereto shall have lapsed in accordance with their respective terms or shall have been discharged in full.

 

6.15.           Time of Essence.  The parties to this Fifth Amendment have agreed specifically with regard to the times for performance set forth in this Fifth Amendment.  Further, the parties to this Fifth Amendment acknowledge that the agreements with regard to the times for performance are material to this Fifth Amendment.  Therefore, the parties agree and acknowledge that time is of the essence to this Fifth Amendment.

 

6.16.           Agreement Binding on Borrower and Guarantors.  The Loan Parties agree that this Agreement will be binding on each of the Loan Parties and their respective successors and assigns; provided, no obligation or right hereunder shall be assignable by any Loan Party (whether voluntarily, involuntarily or by operation of law) without the prior, written consent of Lender.

 

6.17.           Law Governing.  THIS FIFTH AMENDMENT SHALL BE DEEMED TO HAVE BEEN SUBSTANTIALLY NEGOTIATED AND MADE IN THE STATE OF TEXAS AND SHALL BE INTERPRETED AND THE RIGHTS OF THE PARTIES DETERMINED IN ACCORDANCE WITH THE LAWS OF THE UNITED STATES APPLICABLE THERETO AND THE INTERNAL LAWS OF THE STATE OF TEXAS APPLICABLE TO AN AGREEMENT EXECUTED, DELIVERED AND PERFORMED THEREIN, WITHOUT GIVING EFFECT TO THE CHOICE-OF-LAW RULES THEREOF OR ANY OTHER PRINCIPLE THAT COULD REQUIRE THE APPLICATION OF THE SUBSTANTIVE LAW OF ANY OTHER JURISDICTION.

 

6.18.           Waiver; Modification.  NO PROVISION OF THIS FIFTH AMENDMENT MAY BE WAIVED, CHANGED OR MODIFIED, OR THE DISCHARGE THEREOF ACKNOWLEDGED, ORALLY, BUT ONLY BY AN AGREEMENT IN WRITING SIGNED BY THE PARTY AGAINST WHOM THE ENFORCEMENT OF ANY WAIVER, CHANGE, MODIFICATION OR DISCHARGE IS SOUGHT.  NO DELAY ON THE PART OF LENDER IN EXERCISING ANY RIGHT, POWER OR PRIVILEGE HEREUNDER, SHALL OPERATE AS A WAIVER THEREOF, NOR SHALL ANY WAIVER OF ANY RIGHT, POWER OR PRIVILEGE HEREUNDER OPERATE AS A WAIVER OF ANY OTHER RIGHT, POWER OR PRIVILEGE HEREUNDER, NOR SHALL ANY SINGLE OR PARTIAL EXERCISE OF ANY RIGHT, POWER OR PRIVILEGE HEREUNDER PRECLUDE ANY OTHER OR FURTHER EXERCISE THEREOF, OR THE EXERCISE OF ANY OTHER RIGHT, POWER OR PRIVILEGE HEREUNDER.  ALL RIGHTS AND REMEDIES HEREIN PROVIDED ARE CUMULATIVE AND ARE NOT EXCLUSIVE OF ANY RIGHTS OR REMEDIES, WHICH THE PARTIES HERETO MAY OTHERWISE HAVE AT LAW OR IN EQUITY.

 

6.19.           Waiver of Jury Trial.  TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE LOAN PARTIES HEREBY IRREVOCABLY AND EXPRESSLY WAIVE ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT, OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THE ACTIONS OF LENDER IN THE NEGOTIATION, ADMINISTRATION OR ENFORCEMENT THEREOF.

 

6.20.           Final Agreement.  THIS FIFTH AMENDMENT AND THE LOAN DOCUMENTS REPRESENT THE ENTIRE EXPRESSION OF THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF ON THE DATE THIS FIFTH AMENDMENT IS EXECUTED.  NEITHER THIS FIFTH AMENDMENT NOR THE LOAN DOCUMENTS MAY BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

6.21.           Release. BORROWER AND EACH OF THE GUARANTORS HEREBY ACKNOWLEDGE THAT AS OF THE DATE HEREOF THEY HAVE NO DEFENSE, COUNTERCLAIM, OFFSET, CROSS-COMPLAINT, CLAIM OR DEMAND OF ANY KIND OR NATURE WHATSOEVER THAT CAN BE ASSERTED TO REDUCE OR ELIMINATE ALL OR ANY PART OF THEIR LIABILITY TO REPAY THE INDEBTEDNESS OR TO SEEK AFFIRMATIVE RELIEF OR DAMAGES OF ANY KIND OR NATURE FROM LENDER OR ANY OF ITS AFFILIATES, PARTICIPANTS OR ANY OF THEIR RESPECTIVE DIRECTORS OFFICERS, AGENTS, EMPLOYEES, OR ATTORNEYS.  BORROWER AND EACH OF THE GUARANTORS HEREBY VOLUNTARILY AND KNOWINGLY RELEASE AND FOREVER DISCHARGE LENDER, AND ITS AFFILIATES AND PARTICIPANTS, AND EACH OF THEIR RESPECTIVE PREDECESSORS, AGENTS, OFFICERS, DIRECTORS, EMPLOYEES,

 

 

 

 

 

 

 

IN WITNESS WHEREOF, Borrower, Guarantors, and Lender have caused this Fifth Amendment to be executed and delivered as of the date first written.

BORROWER AND GUARANTORS:

	Southern Frac, LLC
	By:	/s/ Christopher A. Wilson
	Name:	Christopher A. Wilson
	Title	Secretary

	GFN Manufacturing Corporation
	By:	/s/ Christopher A. Wilson
	Name:	Christopher A. Wilson
	Title	Secretary

	General Finance Corporation
	By:	/s/ Christopher A. Wilson
	Name:	Christopher A. Wilson
	Title	Vice President and General Counsel

 

LENDER:

 

	Wells Fargo Bank, National Association
	By:	/s/ Ron Zeiber
	Name:	Ron Zeiber
	Title	Authorized Signatory

 

 

 

 

TO INFORMATION CERTIFICATE

Subsidiaries; Affiliates; Investments

Part 1 - Subsidiaries (More than 50% owned by a Loan Party)

Name	Jurisdiction of Organization	Percentage Owned
GFN North America Corp.	Delaware	100%
Pac-Van, Inc.	Indiana	100%
PV Acquisition Corp.	Alberta, Canada	100%
GFN Manufacturing Corporation	Delaware	100%
GFN U.S. Australasia Holdings, Inc.	Australia	100%
GFN Realty	Delaware	100%
Royal Wolf Holdings Limited	Australia	50.01%
Royal Wolf Trading Australia Pty Limited	Australia	50.01%
Royalwolf NZ Acquisition Co. Limited	New Zealand	50.01%
Royalwolf Trading New Zealand Limited	New Zealand	50.01%

Part 2 - Affiliates (Less than 50% Owned by  a Loan Party)

Name	Jurisdiction of Organization	Percentage Owned
None

Part 3 - Affiliates (Subject to common ownership with ) a Loan Party

Name	Jurisdiction of Organization	Parent	Percentage Owned
None

Part 4 - Shareholders (If widely held, only holders with more than 10%)

Name	Jurisdiction of Organization *	Percentage Owned
Please see disclosure delivered in connection with the Credit and Security Agreement dated October 1, 2012.

 

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*  If shareholders are individuals, indicate “N/A”

TO INFORMATION CERTIFICATE

Material Contracts

Name of Agreement	Date of Agreement	Parties to Agreement	Date of Expiration / Termination
General Finance Corporation: None
Lease Agreement	November 4, 2014	GFN Realty, Southern Frac, LLC	[XX]
Southern Frac, LLC	Weekly	Superior Steel, Inc. and Southern Frac, LLC	Weekly steel purchases.

 

 

 

 

 

TO INFORMATION CERTIFICATE

Existing Indebtedness*

Name/Address of Payee		Principal Balance as of August 30, 2013			Nature of Debt	Term
Vintage Bank 300 North Highway 77 Waxahachie, Texas 75168		$	5,790		Automobile loan	November 30, 2013
First Financial PO Box 537 Cleburne, TX 76033-0537		$	16,358		Automobile loan	November 30, 2013

Name/Address of Payee	Principal Balance as of [Date]	Nature of Debt	Term
Citizens National Bank of Texas and guaranteed by GFN Mfg.	[XX]	Property Acquisition	[XX]

 

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TO INFORMATION CERTIFICATE

Owned Real Estate

General Finance Corporation: None

GFN Manufacturing Corporation: None

Southern Frac, LLC: None.

 

 

 

 

 

 

TO INFORMATION CERTIFICATE

Locations of Inventory and Equipment

Address	Owned/Leased/Third Party*	Name/Address of Lessor or Third Party, as Applicable
General Finance Corporation: None	None.	Not applicable.
GFN Manufacturing Corporation: None	None.	Not applicable.
Southern Frac, LLC: 1805 Howard Rd. Waxahachie, Texas 75165	Leased	c/o GFN Realty (same address as Borrower).
Southern Frac, LLC: 1801 Howard Rd. Waxahachie, Texas 75165	Leased	Howard Road Industrial Park, LLC P.O. Box 844 Waxahachie, Texas 75168
Southern Frac, LLC: 1803 Howard Rd. Waxahachie, Texas 75165	Leased	Howard Road Industrial Park, LLC P.O. Box 844 Waxahachie, Texas 75168

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TO CREDIT AND SECURITY AGREEMENT

Real Property Collateral

General Finance Corporation: None

GFN Manufacturing Corporation: None

                Southern Frac, LLC:  None.