HomeMy WebLinkAbout07-1877
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Timothy J. Neiman, Esquire
Attorney I.D. No. 66024
Jennifer Zimmerman, Esquire
Attorney I.D, No. 89459
RHOADS & SINON LLP
One South Market Square
P.O, Box 1146
Harrisburg, P A 17108-1146
(717) 233-5731
Attorneys for Plaintiff
VAUGHAN TRANSPORT, INC.
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY,
PENNSYLVANIA
Plaintiff
v.
CIVIL ACTION - LAW
VAUGHAN TRANSPORTATION
SERVICES, INC., PATRICK CROWE,
and ELIZABETH CROWE
NO. d1- /P17
f;Ul'L/~W}
Defendants
CONFESSION OF JUDGMENT
Pursuant to the authority contained in the warrant of attorney, the original or a copy of
which is attached to the Complaint in Confession of Judgment (Money Judgment) filed in this
action, I appear for the Defendants and confess judgment in favor of the Plaintiff, Vaughan
Transport, Inc., and against the Defendants, Vaughan Transportation Services, Inc., Patrick Crowe,
and Elizabeth Crowe, in the amount of $4,380,611.81, plus interest accruing at a per diem rate of
$981.58, and costs of collection, including, without limitation, reasonable attorneys' fees.
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Respectfully submitted,
RHOADS & SINON LLP
Dated: .*pn' I ~) 11JO'7
By:
Ti othy J. .man, Esquire
Jennifer Zimmerman, Esquire
One South Market Square
P.O. Box 1146
Harrisburg, P A 17108-1146
(717) 233-5731
Attorneys for the Defendants, Vaughan
Transportation Services, Inc., Patrick Crowe,
and Elizabeth Crowe, for the purpose of
confessing judgment; Attorneys for the
Plaintiff, Vaughan Transport, Inc., for all
other purposes
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Timothy J. Neiman, Esquire
Attorney I.D. No. 66024
Jennifer Zimmerman, Esquire
Attorney I.D. No. 89459
RHOADS & SINON LLP
One South Market Square
P.O. Box 1146
Harrisburg, P A 17108-1146
(717) 233-5731
Attorneys for Plaintiff
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY,
PENNSYLVANIA
V AUGHAN TRANSPORT, INC.
Plaintiff
CIVIL ACTION - LAW
v.
v AUGHAN TRANSPORTATION
SERVICES, INC., PATRICK CROWE,
and ELIZABETH CROWE
NO. ()'1-/PIf"l e~c.>;ll~
Defendants
COMPLAINT IN CONFESSION OF JUDGMENT MONEY JUDGMENT
NOW COMES Plaintiff, Vaughan Transport, Inc. ("Plaintiff Vaughan"), by its undersigned
attorneys, Rhoads & Sinon LLP, and files the within Complaint in Confession of Judgment (Money
Judgment), stating as follows:
1. Vaughan Transport, Inc. is a Georgia corporation having an office at P.O. Box
389, New Kingston, Cumberland County, Pennsylvania 17072.
2. Defendant Vaughan Transportation Services, Inc. ("Defendant Vaughan") is a
Georgia business corporation. Defendant Vaughan has represented to Plaintiff that as of April 3,
2007, the business address is 49 Avenue, SW, Lanett, Alabama 36863. Defendant Vaughan also
has a location at 2560 S. Ocean Blvd., Suite 710, Palm Beach, Florida 33480. Until April 3,
6451012
2007, Defendant Vaughan had a business address of 116 Cooley Industrial Way, LaGrange,
Georgia 30241.
3. Defendant Patrick Crowe is an adult individual having an address, upon
information and belief, of 2560 S. Ocean Blvd., Palm Beach, Florida 33480.
4. Defendant Elizabeth Crowe is an adult individual having an address, upon
information and belief, of 2560 S. Ocean Blvd., Palm Beach, Florida 33480.
5. The principal business of Defendant Vaughan is the operation of an intrastate and
interstate trucking business that engages in the delivery of freight for various customers.
6. Defendant Patrick Crowe is the President and principal shareholder of Defendant
Vaughan.
7. On or about August 8, 2005 ("Closing Date"), Plaintiff and Defendant Vaughan
entered into an Asset purchase Agreement (the "AP A") whereby Defendant Vaughan purchased
certain business assets from Plaintiff which included, without limitation, Customer Lists, Open
Orders, Goodwill, Books and Records, Inventory, physical Assets, and Accounts Receivable. A
true and correct copy of the Asset Purchase Agreement is attached hereto as Exhibit A and
incorporated herein by reference.
8. The purchase price for the acquired assets under the AP A was to be paid to
Plaintiff as follows:
a. For the Business, Good Will, Customer List, Open Orders, and Records,
Defendant Vaughan paid Plaintiff Two Hundred Thousand Dollars ($200,000.00)
at closing.
b. For the Inventory and physical Assets, Defendant Vaughan executed and
delivered to Plaintiff a Term Note dated August 1, 2005 in the amount of Two
2
Hundred Twenty Thousand Dollars ($220,000.00) ("Term Note I").
c. For the Accounts Receivable, Defendant Vaughan paid to Plaintiff Five
Hundred Thousand Dollars ($500,000.00) at closing and was to remit to Plaintiff
all collections on the Accounts Receivable collected by Defendant Vaughan in
excess of Five Hundred Thousand Dollars ($500,000.00), within five business
days from when they were received. [AP A, ~ 2]
9. As of the Closing Date, the outstanding accounts receivable was valued at
approximately $1,050,000 and, to date, Defendant Vaughan has collected $940,505.41 of the
outstanding accounts receivable. Of that amount, the $440,505.41 collected in excess of the
$500,000 paid at closing was to be remitted to plaintiff within five business days of receipt,
however, only $97,532.32 was remitted to Plaintiff leaving a balance due to Plaintiff of Three
Hundred Forty-Two Thousand, Nine Hundred Seventy-Three Dollars and Nine Cents
($342,973.09).
10. Accordingly, due to Defendant Vaughan's failure to remit the collected accounts
receivable when due, on or about March 20, 2006, Defendant Vaughan executed and delivered a
Term Note to Plaintiff in the amount of Three Hundred Forty-Two Thousand, Nine Hundred
Seventy-Three Dollars and Nine Cents ($342,973.09) ("Term Note If'). A true and correct copy of
Term Note II is attached hereto as Exhibit B and incorporated herein by reference.
11. On or about August 8, 2005, Plaintiff and Defendant Vaughan entered into a
Lease Agreement (the "Equipment Lease") for the lease of certain equipment identified on
Schedule A to the Equipment Lease (the "Leased Equipment"). A true and correct copy of the
Equipment Lease is attached hereto as Exhibit C and incorporated herein by reference.
12. Plaintiff and Defendant Vaughan entered into a Security Agreement on or about
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August 8, 2005 (the "Security Agreemeut"), wherein Defeudant Vaughan granted Plaintiff a
security interest in a1l of Defeudant Vaughan's assets with the exclusion of accounts, as defined
in the DCC (the secured assets collectively referred to as the "Collateral"). Plaintiff perfected its
security interest hy filing a UCC-I Financing Statement in Georgia on or about August 10, 2005.
A true and correct copy of the Security Agreement is attached hereto as Exhibit D and
incorporated herein by reference.
13. On or about August 8, 2005, Defendant Patrick Crowe and Defendant Elizabeth
Crowe (collectively referred to as "Crowe Defendants") executed a personal guaranty wherein
they each agreed, jointly and severally, to irrevocably, absolutely and unconditionally guarantee
and become a surety for the obligations and liabilities contained in Term Note I and the
Equipmeut Lease, and any expenses or fees associated with enforcing said ohligations
("Guaranty f')- A tme and correct copy of Guaranty I is attached hereto as Exhibit E and
incorporated herein by reference.
14. On or about April 13, 2006, the Crowe Defendants executed a personal guaranty
wherein they each agreed, jointly and severally, to irrevocably, absolutely and unconditionally
guarantee and become a surety for the obligations and liabilities contained in Term Note II and
any expeuses or fees associated with euforcing said obligation ("Guaranty If'). A true and
correct copy of Guaranty II is attached hereto as Exhibit F and incorporated herein by reference.
15. Term Note I, although not paid in accordance with the terms ofthe note, was fully
satisfied as of November 3, 2006. (Term Note II, the Equipment Lease, Guaranty I and Guaranty
II are collectively referred to as the "Agreements")
4
EQUIPMENT LEASE
16. On or about August 8, 2005, Plaintiff and Defendant Vaughan entered into the
Equipment Lease.
17. Pursuant to the terms and conditions of the Equipment Lease, Defendant Vaughan
leased certain equipment from Plaintiff and was to pay Plaintiff an aggregate amount of
$5,500,000_00 in payments as follows: (a) $300,000.00 npon the execution and delivery of the
Equipment Lease; and (b) $5,200,000.00 in sixty (60) equal consecutive monthly installment
payments, together with interest thereon at the rate of eight percent (8%) per annum, each in the
amount of $105,437.25, beginning September 1, 2005 and continuing on the first day of each
successive month thereafter, with the sixtieth (60th) and final payment due August 1,2010.
18. Defendant Vaughan made the initial $300,000.00 payment to Plaintiff and made
the required monthly payments from September 2005 through December 2005.
19. Beginning in January 2006 and continuing to date, Defendant Vaughan is in
default under the Equipment Lease for the failure to make monthly installment payments in the
amount of$105,437.25 each when due. Thus, a Default has occurred, as defined in Paragraph 12
of the Equipment Lease.
20. During the months of February 2006 through present, while Defendant Vaughan
failed to remit timely payments, Defendant Vaughan did make sporadic payments which Plaintiff
applied to late fees, principal and interest.
21. During the term of the Equipment Lease, Defendant Vaughan, with Plaintiffs
consent, sold certain pieces of the Leased Equipment to meet and/or reduce its obligations to
Plaintiff under the Equipment Lease. Plaintiff applied the proceeds of the sale of the Leased
5
Equipment in the total amount of $275,58\.28 to late fees and amounts past due under the
Agreements.
22. A Schedule showing payments made under the Equipment Lease and the
respective amounts applied to principal and interest is attached hereto as Exhibit G and
incorporated herein by reference- AI; shown on Exhibit G, as of April 2, 2007, the outstanding
balance of principal and interest under the Equipment Lease is $4,098,116.44.
23. A Schedule showing the scheduled amortization of principal and interest under
the Equipment Lease, asswning monthly installment payments had been made when due, is
attached hereto as Exhibit H and incorporated herein by reference. As indicated on Exhibit H,
the outstanding balance of principal and interest under the Equipment Lease on April 2, 2007,
assuming all monthly installment payments had been made when due, should be $3,416,433.80.
24. As set forth supra in Paragraphs 46-52, a late fee in the amount of $5,271.86
remains due and owing on the Equipment Lease.
25. As such, as of April 2, 2007, a past due amount of $686,954.50, including
accrued interest and a late fee, remains due and owing to Plaintiff.
26. pursuant to Paragraph 13 of Equipment Lease, Plaintiff has accelerated all unpaid
amounts due and owing, thereby requiring Defendant Vaughan to immediately pay all unpaid
payments due.
27. Accordingly, as of April 2, 2007, the total accelerated amount due, including
interest and late fees, under the Equipment Lease is $4,103,388.83, plus costs of collection,
including, without limitation, reasonable attorneys' fees as allowed by Paragraph 13.
28. Upon information and belief, the Leased Equipment is located m Lanett,
Alabama.
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29. Plaintiff intends to exerCIse its rights under Paragraph 13 to terminate the
Equipment Lease and peacefully repossess the Leased Equipment.
30. Once Plaintiff takes possession of the Leased Equipment, Plaintiff intends to
dispose of the collateral at either a public or private sale and apply the net proceeds (after the
costs related to the sale or disposition ofthe Leased Equipment) to the amount of the judgment.
31. Paragraph 21 of the Equipment Lease contains confession of judgment and
warrant of attorney provisions which empower any attorney of any court of record to appear in
any court for and enter judgment against Defendant Vaughan and in favor of Plaintiff upon the
occurrence of a Default.
32. As of April 4, 2007, the amount of the judgment to be entered under the
Equipment Lease, with accrued interest to date, is $4,105,187.59, plus interest accruing at a per
diem rate of $899.38, and costs of collection, including, without limitation, reasonable attorneys'
fees.
TERM NOTE II
33. On or about March 20, 2006, Defendant Vaughan executed and delivered Term
Note II to Plaintiff in the amount of Three Hundred Forty-Two Thousand, Nine Hundred Seventy-
Three Dollars and Nine Cents ($342,973.09).
34. Pursuant to the terms and conditions of Term Note II, Defendant Vaughan was to
pay to Plaintiff six (6) equal consecutive monthly installments of principal in the amount of F orty-
Eight Thousand Nine Hundred Ninety-Six and 15/100 Dollars ($48,996.15) each, plus accrued but
unpaid interest, and a seventh (ih) and final installment of principal in the amount of Forty-Eight
Thousand Nine Hundred Ninety-Six and 19/100 Dollars ($48,996.19) on October 20, 2006, on
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which date accrued but unpaid interest and all charges, fees and other sums under this Note shall be
due and immediately payable in full.
35. Interest accrued on the unpaid principal balance of this Term Note II at a floating
rate of interest equal to the prime Rate as reported in The Wall Street Journal on the date of this
Term Note II or on the applicable adjustment date, as the case may be, 2lus two and one-half
percent (2.5%). [Term Note II, ~ 2]
36. Beginning April 20, 2006, one month after Term Note II was executed and
delivered to Plaintiff and continuing to date, Defendant Vaughan is in default under Term Note II
for the failure to make payments when due.
37. Defendant Vaughan has not made any on time payments, thus, an Event of
Default has occurred, as defined in Term Note II. In fact, Defendant Vaughan did not make any
payments on Term Note II during the term of the note.
38. Thus, interest accrued on Term Note II from March 20, 2006 through December
31, 2006 in accordance with the Schedule attached hereto as Exhibit I and incorporated herein by
reference. Therefore, as of January 1, 2007, the total balance on Term Note II, including accrued
interest, was $372,082.78.
39. Beginning in January 2007, Defendant Vaughan began making sporadic payments
to Plaintiff which were applied to late fees, principal and interest under Term Note II.
40. A Schedule showing accrued interest on and payments made under Term Note II
and the respective amounts applied to principal and interest is attached hereto as Exhibit J and
incorporated herein by reference.
41. As set forth supra in Paragraphs 46 - 52, there are no longer any outstanding late
fees due and owing to Plaintiff under Term Note II.
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42. As of April 2, 2007, a past due amount of $275,259.82 remains due and owing to
Plaintiff.
43. In addition to the amount due under Term Note II, Plaintiff is also entitled to
collect all charges, fees and other expenses of collection, including reasonable attorneys' fees
[Term Note II, , 10], plus interest accruing at the agreed upon rate of Prime plus 25% from the
date of entry of judgment. [Term Note II, ~ 9]
44. Paragraph 8 of Term Note II contains confession of judgment and warrant of
attorney provisions which empower any attorney of any court of record to appear in any court for
and enter judgment against Defendant Vaughan and in favor of Plaintiff upon an Event of
Default.
45. As of April 4, 2007, the amount of the judgment to be entered under Term Note
n, with accrued interest to dale is $275,424.22, plus interest accruing at a per diem rate of $82.20
and costs of collection, including, without limitation, reasonable attorneys' fees.
LATE PAYMENT FEES
46. In accordance with Paragraph 3 of the Equipment Lease, Plaintiff assessed
Defendant Vaughan with a late payment fee of 5% of the amount due, for any monthly
installment payment not paid in full by the first of each month.
47. Thus, beginning in January 2006 and continuing to date, Plaintiff charged
Defendant Vaughan a late payment fee each sequential month that Defendant Vaughan failed to
remit timely monthly installment payments under the Equipment Lease.
48. In accordance with Paragraph 3 of Term Note II, Plaintiff assessed Defendant
Vaughan with a late payment fee equal to 5% of the amount due, for any monthly installment
payment not paid in full within ten (l 0) calendar days of the due date.
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49. Thus, a late payment fee was charged for each of the seven (7) months a monthly
installment payment was due under Term Note II, as Defendant Vaughan did not commence
payments on Term Note n until January 2007, two months after Term Note II should have been
paid in full.
50. As Plaintiff received payments from Defendant Vaughan, Plaintiff allocated
amounts to the payment of the late fees. A Schedule showing how the late fees accrued on each
of the Agreements and how Plaintiff allocated payments to the late fees is attached hereto as
Exhibit K and incorporated herein by reference.
51. Accordingly, one late payment fee for the month of April 2007 in the amount of
$5,271.86 is due and owing under the Equipment Lease and there are no outstanding late
payment fees due under Term Note II.
52. Late payment fees were also assessed under Term Note I and the allocation of
payments thereof also is reflected on the Schedule attached as Exhibit K as late payment fees
under the Asset Note. Term Note I is fully satisfied and is not a subject of the instant action.
GU~TYI
53. Pursuant to Guaranty I, the Crowe Defendants are each liable, jointly and
severally to Plaintiff for the outstanding amounts due owed by Defendant Vaughan to Plaintiff
under the Equipment Lease in the total accelerated amount of $4,105,187.59, plus interest
accruing at a per diem rate of $899.38, and costs of collection, including, without limitation,
reasonable attorneys' fees.
54. Paragraph 6 of Guaranty I contains confession of judgment and warrant of
attorney provisions which empower any attorney of any court of record to appear in the
Commonwealth of Pennsylvania, or any jurisdiction where permitted by law, for and enter
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GUARANTY II
55. Pursuant to Guaranty II, the Crowe Defendants are each liable, jointly and
severally to Plaintiff for the outstanding amounts due owed by Defendant Vaughan to Plaintiff
under Term Note II in the total amount of $275,424.22, plus interest accruing at a per diem rate
of $82.20 and costs of collection, including, without limitation, reasonable attorneys' fees.
56. Paragraph 6 of Guaranty II contains confession of judgment and warrant of
attorney provjsions which empower any attorney of any court of record to appear in the
Commonwealth of Pennsylvania, or any jurisdiction where permitted by law, for and enter
judgment agaiust the Crowe Defendants and iu favor of Plaintiff upon default of the principal
debtor, Defendant Vaughan.
57. Judgment is not being entered by confession under any ofthe Agreements against
a natural person in connection with a consumer credit transaction.
judgment agaiust the Crowe Defendants and in favor of Plaintiff upon default of the principal
debtor, Defendant Vaughan.
58. None ofthe Agreements have been assigned.
59. Judgment has not been entered on the warrants of attorney contained in any ofthe
Agreements in any jurisdiction.
60. The total amount presently due and payable to Plaintiff under the Agreements is
$4,380,611.81, plus interest accruing at a per diem rate of $981.58, and costs of collection,
including, without limitation, reasonable attorneys' fees.n
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RHOADS & SINON LLP
WHEREFORE, Plaintiff, Vaughan Transport, Inc., demands judgment in its favor and
against Defendants, Vaughan Transportation Services, Inc., Patrick Crowe, and Elizabeth Crowe,
in the amount of $4,380,611.81, plus interest accruing at a per diem rate of $981.58, any
additional costs of suit, attorneys' fees, and such other charges as authorized by the warrants
contained in the Agreements.
Respectfully submitted,
Dated:~H~l Lt ) 'ZoO 1
o!"
By:
imothy 1. iman, Esquire
Jennifer Immerman, Esquire
One South Market Square
P.O. Box 1146
Harrisburg, P A 17108-1146
(717) 233-5731
Attorneys for the Defendants, Vaughan
Transportation Services, Inc., Patrick Crowe,
and Elizabeth Crowe, for the purpose of
confessing judgment; Attorneys for the
Plaintiff, Vaughan Transport, Inc., for all
other purposes
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Date:
Y-7~()1
w~
William Keen
President
Vaughan Transport, Inc.
VERIFICATION
William Keen hereby deposes and says, subject to the penalties of 18 Pa. c.s. 9 4904
relating to unsworn falsification to authorities, that he is the President of Vaughan Transport, Inc.,
that he makes this verification as such officer by its authority and that the facts set forth in the
foregoing Complaint in Confession of Judgment are true and correct to the best of his
knowledge, information and belief.
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CERTIFICATE OF SERVICE
I hereby certify that on this 4th day of April, 2007, a true and correct copy of the
foregoing Complaint In Confession Of Judgment (Money Judgment) was served by means of
certified United States mail, return receipt requested, first class, postage prepaid, upon the
following:
Vaughan Transportation Services, Inc.
2560 South Ocean Boulevard
Suite 710
Palm Beach, FL 33480
Vaughan Transportation Services, Inc.
116 Cooley Industrial Way
LaGrange, GA 30241-6182
Vaughan Transportation Services, Inc.
49 Avenue SW
Lanett, AL 36863
Patrick Crowe
2560 South Ocean Boulevard
Suite 710
Palm Beach, FL 33480
Elizabeth Crowe
2560 South Ocean Boulevard
Suite 710
Palm Beach, FL 33480
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A
A
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WIT N E SSE T H:
ASSET PURCHASE AGREEMENT
AGREEMENT made this day of July, 2005 by and between VAUGHAN TRANSPORT, INC., a
Georgia Corporation having its principal place of business at 116 Cooley Industrial Dr., LaGrange, GA
30241 (hereinafter "Seller"), and VAUGHAN TRANSPORTATION SERVICES, INC., a Georgia
corporation having its principal place of business at 2560 S Ocean Blvd, Suite 710, Palm Beach, FL
33480 (hereinafter "Buyer")
WHEREAS, the principal business of the Seller is the delivery of freight for various customers
(the "Business");
WHEREAS, Seller desires to sell some of its assets and have the Buyer purchase some of the
assets;
WHEREAS, the Buyer desires to purchase some of such assets on the terms and conditions set
fourth below.
NOW THEREFORE, in consideration of the mutual promises and covenants hereinafter set forth
and subject to the terms and conditions hereof the parties agree as folloWS:
1. Transfer of Assets
At the Closing, Seller shall sell, transfer assign, convey and deliver to Buyer, and Buyer shall
purchase, accept and acquire from Seller, free of any and all liens, security interests, charges and
encumbrances except as set forth in "Exhibit C" attached hereto and'made a part hereof
("Permitted Encumbrances") certain assets of Seller (the "Assets"). The Assets, as set forth in
"Exhibit A" shall Include but not be limited to:
(a) Customer List ("Customer List");
(b) All open orders with respect to Seller's customers ("Open Orders");
(c) All rights of Seller in and to the physical properties used or useful in connection
with the Business such as furniture, computers, storage cabinets, office, shop and garage
equipment, electronic equipment, service vehicles, and other physical assets of Seller, including,
without limitation, those listed on Exhibit A, attached hereto (Physical Assets");
(d) All inventory including fuel on hand and in truck fuel tanks ('Inventory"):
(e) All operating data, books, files and records, whether in print, electronic or other
media, including, without limitation, correspondence, billing information, invoices and
records, financial sales, market and credit information, drawings, patterns, slogans,
processes, market research and other research materials and contract documents ("Records");
Seller will have post closing access to the Records for up to three years after the closing for tax
and other legitimate business purposes.
(f) All gooclwill incident to or associated with the Business as a going concern, such as
telephone numbers, telephone and advertising listings relating to the Business, information and
data relating to the clients and suppliers of, and contractors to, the Business, and all web sites,
domain names, marketing, trademarks, trade names, including, without limitation, all rights,
if any, to the name "Vaughan Transport", and all combinations with any of the fore-going, service
571634,3
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The purchase price for the Assets shall be as follows:
For the Business, Good Will, Customer List, Open Orders, and Records, Buyer will pay
Seller Two Hundred Thousand ($200,000) dollars. This sum is payable at closing.
For the Inventory and Physical Assets Buyer will pay $ . At closing Buyer will
execute and deliver to Seller Buyer'S Term Note in the form attached hereto as Exhibit G.
For the Accounts Receivable, Buyer will pay to the Seller Five Hundred Thousand
($500,000) at closing and will remit to Seller all collections on such Accounts Receivables
collected by Buyer in excess of Five Hundred Thousand ($500,000) dollars, within five
business days from when they are received.
Buyer shall receive a credit at Closing in an amount equal to the Accounts Payable
assumed by Buyer.
Except for the liabilities and obligations listed on Exhibit B (the liabilities
and obligations listed on Exhibit B are hereinafter referred to as the RAssumed
Contracts"), the Purchaser shall assume no other liabilities or other obligations,
Commercial or otherwise, of Seller.
marks, copyrights, trade secrets, processes, know how, promotional displays and materials and
any licenses, license agreements and applications related to any of the foregoing including
without limitation, those listed on Exhibit A_, attached hereto (Goodwill"); provided that from
and after the closing Seller shall have a license to use the name "Vaughan Transport, Inc: as its
corporate name, provided that Seller limits its activities to its roles as "Lessor" under the Rolling
Stock Lease (hereinafter defined), as "Payee" under the Term Note (hereinafter defined) and
the Guarantees (hereinafter defined), and as the .Secured Party" under the Security Agreement
(hereinafter defined).
(g) Accounts Receivable as of the closing date (Accounts Receivable").
2. Purchase Price and Payment Terms
Buyer and Seller hereby acknowledge and agree that for purposes of Closing the purchase
prices of various assets may be based upon good faith estimates, in which cases Buyer and
Seller agree to negotiate in good faith any adjustments thereto and any increases in the amounts
payable to Seller by Buyer, or any reimbursements to be made by Seller to Buyer, as a result
thereof, by reason of any definhive counts, identifications, billings and the like made or becoming
available within forty-five (45) days after the Closing Date.
3. Lease of Offices and Terminal
At Closing Buyer will assume the existing lease between Raymond Vaughan and Jerrell
Vaughan, Landlords and Vaughan Transport, Inc, Tenant for the terminal located at 116 Cooley
Industrial way, LaGrange, Ga.
4. Rollina Stock
At Closing Seller will Lease to Buyer trucks, tractors, and trailers as listed on Exhibit D the
("Rolling Stock"). The term of the lease will be for five years, with interest at the rate of eight
percent. At the Closing the Buyer will make an initial payment to Seller of $300,000. At the end of
the term period Buyer will be able to purchase the equipment for One Dollar. Buyer is leasing the
Rolling Stock" As Is" and is responsible for all maintenance, repairs, and insurance. A copy of the
Rolling Stock Lease is also
attached as Exhibit D.
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7. Personal PropertY Taxes.
Georgia personal property taxes will be pro rated between Buyer and Seller at closing based
upon the actual amount paid by Seller for taxes already paid and based upon an agreed upon
estimate for taxes to be billed, subject to adjustment when said taxes are in fact billed.
5. Emplovees
Seller will terminate all employees at the time of the closing and Buyer will rehire all employees at
the time of the closing.
6. Utilities
Seller will terminate all utilities at the time of Closing and Buyer will establish new utility accounts
at the time of closing.
8. Closina
The closing hereunder ("Closing) shall take place at a place and time mutually agreed upon by
the Buyer and the Sellers. The target date is August1. 2005, subject to such later date as the
parties may agree.
9. Contract Period
During the period from the date of this Agreement to the Closing Date. Sellers shall make
available to Buyer. all books and records. existing contracts, leases, customer files, security
deposits, employee records, environmental reports and any other item or property of the
Business reasonably requested by Buyer. Buyer has completed its due diligence.
10. Closina Conditions & Deliveries
(a) Buyer's Conditions: Unless waived by Buyer. the obligation of the Buyer to
Consummate the transactions contemplated by this Agreement is subject to the
satisfaction of each of the following conditions precedent on or prior to the Closing
Date:
(i) Closing Documents: The Seller shall have executed and delivered
to the Buyer on or before the Closing Date all of the documents. in the
forms attached hereto, to be executed and delivered by Seller pursuant to Paragraph
10(c) below hereof.
(ii) Representations and Warranties: All representations and warranties
of Seller contained in this Agreement shall be true and correct in all material
respects as of the date hereof and on the Closing Date as if made again on and with
respect to the Closing Date, unless such representations and warranties expressly speak
of a specific date other than the Closing Date herein.
(iii) Obligations: The Seller shall have performed in all material respects
all covenants and obligations required by this Agreement to be performed by the
Seller prior to or on the Closing Date.
(iv) No Suits or Actions: No suit or action by any party, investigation,
inquiry or proceeding by any governmental authority, or any legal or ad-
Administrative proceeding shall have been instituted or threatened on or
before the Closing Date which seeks to prevent or questions the validity
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(iii) No Suits or Actions: No suit or action by any party, investigation,
inquiry or proceeding by any governmental authority, or any legal and or
administrative proceeding shall have been instituted or threatened on or before
the Closing Date, which seeks to prevent or questions the validity or legality of any
transaction contemplated hereby.
or legality of any transaction contemplated hereby.
(b) Sellers Conditions: Unless waived by Seller, the obligation of Seller to consummate the
transactions contemplated by this Agreement is subject to the satisfaction of each of the following
conditions precedent on or prior to the Closing Date:
(i) Closing Documents: The Buyer shall have executed and delivered
to the Seller on or before the Closing Date all of the documents, in the forms
attached hereto, to be executed and delivered by Buyer pursuant to Paragraph 10(d)
below hereof.
(ii) Representations and Warranties: All representations and warranties
of the Buyer contained in this Agreement shall be true and correct in all
material respects as of the date hereof and on the Closing Date as if made
again on and with respect to the Closing Date (unless such representations and
warranties expressly speak as of a specific date other than the date hereof).
(iv) Obligations: The Buyer shall have performed in all material respects all
covenants and obligations required by this agreement to be performed by the Buyer prior
to or on the Closing Date, including, but without limitation, making the payments required
by this Agreement to be made on the closing Date
(c) Closing Deliveries of the Seller: The following documents, agreements and showings will
be delivered or provided to Buyer at the Closing:
(i) Execution and delivery by the Seller of a Bill of Sale, and other instruments of
assignment and conveyance, including all required motor vehicle titles, to the extent
included, in form and substance acceptable to Buyer and sufficient to convey to Buyer
good and marketable title to the Assets free and clear of any and all title defects. liens,
encumbrances, charges and equities whatsoever, except Permitted Encumbrances
(ii) Rolling Stock Lease
(iii) Delivery of a Lease Assumption Agreement of even date with this Agreement, in
the form attached hereto as Exhibit E, for the office and terminal at 116 Industrial
Parkway, LaGrange, GA.
(iv) Delivery to Buyer of The Records; and
(v) Delivery to the Buyer of fully executed Covenant Not to Compete from
Keen Transport, Inc in the form attached hereto as Exhibit F.
(d) Buyer's Closing Deliveries: The following documents, agreements and showings
will be delivered or provided to the Seller at the Closing:
(i) Delivery of the Purchase Price;
(ii) Execution and Delivery of the Lease Assumption Agreement for offices and
Terminal located at 116 Cooley Industrial Parkway, LaGrange, GA.
-4-
.
(e) Neither this agreement, including all Exhibits, nor the Closing documents
contains, or will contain, any untrue statement of any material fact, or omits, or will
omit to state any material fact, required to be stated in order to make such statement,
document or other instrument not misleading. There is no fact known to the Sellers,
which materially adversely affects the Business or its prospects, which has not been
set forth in this Agreement or the Exhibits to this Agreement.
(f) Exceptas to Buyer or its Agents, the Seller is not a party to any written arrangement
concerning confidentiality or any written arrangement concerning non-competition that relates to
the Business.
(Hi) Rolling Stock Lease
(iv) Term Loan Note
(v) Security Agreement
(vi) Guarantees
11. Nondisclosure
Prior to Closing, each of the parties hereto agrees that no press release, Internet posting
or other public announcement of any kind (including confirmation of any statement made by a
third party) concerning this transaction will be made without the advance written consent of the
other party hereto. Nothing contained in the preceding sentence shall be deemed to limit the
ability of any party hereto to make available to its officers, directors, investors, accountants or
attorneys, on a need-to-know basis, any information obtained in connection with the due
diligence review.
12. Representations and Warranties of Seller
As a material inducement to Buyer to enter into this Agreement and consummate the transactions
contemplated hereby, Seller represents and warrants to Buyer that all of the statements
contained in this Paragraph 12 are correct and complete as of the date of this Agreement:
(a) The Seller is a corporation duly organized, validly existing, and in good standing
under the laws of the State of Georgia, with all requisite corporate power and authority
to own and operate its Assets, to carry out its business as now being conducted, and to enter
into this Agreement and perform its obligations hereunder. The Seller is qualified to conduct
business and is in good standing under the laws of each jurisdiction wherein the nature of the
Business or its ownership of the Assets requires it to be so qualified.
(b) On or before the Closing Date the execution, delivery and performance of this Agreement
will have been duly and validly authorized and approved by all necessary corporate action, and
this Agreement constitutes a valid and legally binding obligation of Seller and is enforceable
against Seller in accordance with its terms. The Seller has the full right, power and authority to
transfer ownership of the Assets owned by such Seller to Buyer.
(c) The Seller has good and marketable title to all of the Assets subject to no mortgages,
pledges, security interests, liens, or other encumbrances except Permitted Encumbrances set
forth in Exhibit C. The Assets collectively constitute all assets necessary to the conduct of
the Business in all material respects as historically conducted and currently conducted.
(d) Seller has endeavored to act in good faith by providing Buyer with truthful and complete
financial statements of the Seller's business operation.
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(i) All claims, debts, liabilities and obligations of Purchaser whether
absolute or contingent arising out of or in connection with the Assets, the
Customers and the Business arising or which may arise in connection
with the conduct of the Business by Purchaser on or after the Closing Date, including, but
(g) Seller makes no representations or warranties as to the condition of the Assets and
Buyer agrees to accept such Assets in their "as is" condition.
(h) There are no known environmental issues concerning Seller either related to the
premises occupied by it or in the course of its operations.
13. ReDresentations and Warranties of Buver
As a material inducement to Seller to enter into this Agreement and consummate the transactions
contemplated hereby, Buyer represents and warrants to Seller that all of the statements
contained in this Paragraph 13 are correct and complete as of the date of this Agreement:
(a) Buyer is a Georgia Corporation, duly organized validly existing, and in good standing
under the laws of the State of Georgia with all requisite corporate power and authority to carry on
its business as now being conducted and to enter into this Agreement and perform its obligations
hereunder.
(b) The execution, delivery and performance of this Agreement have been duly and validly
authorized and approved by all necessary action, including, but not limited to, approval by the
Board of Directors, and Buyer represents that this Agreement is a valid obligation of Buyer and is
enforceable against it in accordance with its terms.
(c) Buyer represents that the financial statements provided to the Seller are truthful and
complete and that Buyer will have sufficient unrestricted funds on hand or Commercial Credit
available to consummate this transaction at closing.
14. BrokeraQe
Each party represents and warrants that there was no broker involved in this transaction and that
there are no claims for brokerage commissions or finders fees in connection herewith by any
other person or entity. Each party hereby agrees to indemnify and hold the other harmless from
any and all liability or loss arising as of the result of any liability to any broker or finder on the
basis of any arrangement or agreement made by or on behalf of such party.
15. Cross Indemnities
(a) Seller hereby undertakes and agrees to indemnify Purchaser (and its shareholders,
officers, and directors and their respective Successor; heirs, personal representatives and
assigns) and hold irand them harmless against and in respect of the following:
(i) All claims, debts, liabilities, accounts payable and obligations of
Seller whether absolute or contingent arising out of or in connection with
the Assets, the customers and the Business arising or which may
arise in connection with the conduct of the Business by Seller prior to the
Closing Date, including but not limited to, liabilities and obligations not assumed by the
Buyer, whether or not such liabilities are .asserted prior to the Closing Date or thereafter,
except for the Assumed Liabilities.
(b) Purchaser hereby undertakes ,and agrees to indemnify Seller (and its share-holders,
officers, and directors and their respective successors, heirs, personal representatives and
assigns) and hold it and them harmless against and in respect of the following:
- 6 -
.
-7-
not limited to, the Assumed Liabilities but expressly excluding any and all claims,
debts, liabilities, and obligations not assumed by the Buyer.
(c) The covenants of indemnity set forth in this Section 15 are intended by the
parties to be for the benefit of each other and their respective shareholders, officers, and
directors, and their respective successors, heirs, personal representatives and assigns, All
of the covenants of indemnity set forth in this Section 15 shall be deemed renewed by the
parties at the Closing, as if made at such time and shall survive indefinitely after the Closing Date.
(d) If any legal proceeding shall be instituted or any claim or demand made against a party
(the "Nondefaulting Party") by any third party in respect of which the other party (the "Defaulting
Party") may be liable under the indemnity set forth in this Section 15, the Nondefaulting Party
shall give written notice by certified mail or over night delivery thereof to the Defaulting Party
within five (5) days following the date of which the Nondefaulting Party is informed in writing of the
institution of such proceeding or receives such claim or demand. Upon receipt of such notice, the
Defaulting Party shall undertake the defense of such proceeding, claim or demand through
counsel selected by the Defaulting Party at its own expenses (provided that the Nondefaulting
Party shall be entitled, at its expenses, to participate in any such legal proceeding or the
negotiation and settlement thereof through counsel of its choice).
(e) The Defaulting Party, in all cases, has the absolute right to settle or compromise any
such proceeding, claim or demand or to refrain there from, provided that if the Nondefaulting
Party does not consent to a settlement or compromise proposed by the Defaulting Party and
agreed to by the third party and such proceeding, claim or demand shall ultimately result in a
judgment or settlement greater than the proposed settlement or compromise, the Defaulting Party
shall be discharged from any liability hereunder with respect to any amount in excess of the
settlement or compromise so proposed and agreed to and any expenses incurred subsequent to
the date the settlement or compromise originally was so proposed and agreed to. If the
Nondefaulting Party effects a settlement or compromise without prior written consent of the
Defaulting Party, the Defaulting Party shall be discharged from any liability hereunder in excess of
expenses incurred prior to the date the settlement or compromise was effected by the
Nondefaulting Party, provided that such expenses are reasonable in amount and were
reasonably required for the Nondefaulting Party's defense against the settled or compromised
claim or demand which, when it was asserted, reasonably appeared to be a liability for which the
Defaulting Party would be liable to the Nondefaulting Party hereunder.
16. Notices
Any notice required to be given hereunder shall be deemed validly given if in writing and
delivered by certified mail, return receipt requested, addressed as follows:
(a) If to Seller:
William Keen
Keen Transport, Inc
P.O. Box 389
New Kingstown, PA 17072
(b) If to Buyer:
Patrick Crowe
2560 S Ocean Blvd
Suite 710
Palm Beach, FL 33480
.
[signatures appear on following pagel
17. Miscellaneous
(a) This Agreement, together with the Exhibits annexed hereto, embodies th,e entire
agreement and understanding of the parties hereto and supersedes any prior agreement
or understanding of the parties hereto and supersedes any prior agreement of understanding
between the parties or representations by either party.
(b) This Agreement cannot be modified, changed, discharged or terminated except by a
writing signed by all of the parties.
(c) The invalidity or un enforceability of any term, phrase, clause, article, paragraph or
covenant hereof shall not affect the validity and enforcement of any other provision hereof.
(d) This Agreement shall be governed by the laws of the State of Georgia and shall be
binding upon and shall inure to the benefit of the parties hereto and their respective successors
and assigns.
(e) This Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the same
instrument.
- 8 -
-
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set forth
above.
VAUGHAN TRANSPORT, INC (Seller)
By:
wz4-
WILLIAM KEEN, President
ATTEST:
j( AP2(j
VAUGHAN TRANSPORTATION SERVICES,
INC. (Buyer)
By:
PATRICK CROWE, President
ATTEST:
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I
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By:
~c
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~~
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set forth
above.
VAUGHAN TRANSPORT, INC (Seller)
By:
WILLIAM KEEN, President
ATTEST:
VAUGHAN TRANSPORTATION SERVICES,
INC. (Buyer)
PATRICK CROWE, President
~
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LIST OF EXHIBITS
A Assets included in Sale
B Assumed Liabilities
C Encumbrances
0 Rolling Stock List and Lease
E Lease Assumption Agreement
F Non-Compete Agreement
G Term Note
-
ASSET PURCHASE AGREEMENT
ASSETS INCLUDED IN SALE
Business, Customer list, Open orders, and Records
Accounts receivable and unbilled revenue (estimate)
Physical Assets and Inventory
GA Revenue Equipment licenses
Inventories
Office supplies
Parts and supplies
Tires
Bulk fuel (estimate)
Fuel in trucks (73 trucks 135 gal each @ $2.40)
2,500.00
48,500.00
2,500.00
9,159.20
23,652.00
Fixed Assets
Vehicles
98 Chev Pick-up
05 Chrysler 300
05 Ford Crown Vic
Shop equipment & Fuel System
Office furniture, equipment and computers
6,000.00
23,500.00
20,500.00
Total Physical Assets and Inventory
Exhibit A
Estimated
Value
$ 200,000.00
1,050,000.00
28,688.80
86,311.20
50,000.00
25,000.00
30,000.00
220,000.00
-
Accounts Payable
10,000.00
Exhibit B
ASSET PURCHASE AGREEMENT
ASSUMED LIABILITIES
Estimated
Value
$ 140,000.00
Accrued vacation
150,000.00
-
I
B
13
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$342,973.09
Carlisle, Pennsylvania
March 2.t>, 2006
TERM NOTE
FOR VALUE RECEIVED, THE UNDERSIGNED, VAUGHAN TRANSPORTATION
SERVICES, INe. (hereinafter the "Maker"), does hereby promise to pay to the otder of
VAUGHAN TRANSPORT, INC., its successors and assigns (hereafter, the "Payee''), at P.O. Box
389, New Kingston, pennsylvania 17072, or at such other place as the Holder (as defined herein)
may, from time to time, designate, the sum ofTIIREE HUNDRED FORTY-TWO rnOUSAND,
NINE HUNDRED sEVENTY-TIIREE DOLLARS and NINE CENTS ($342,973.09) Iawfu\
money of the United States of America, payable at the time or times provided for in this Note, and
any and all other sums which may be owing to the Holder by the Maker pursuant to this Note. The
following tenDS shall apply to this Note.
1. Repavment. Commencing on April 20, 2006 and continuing on the 20th day of each
successive month thereafter, Maker shall pay to the Payee six (6) equal consecutive monthly
installments of principal in the amount of FORTY -EIGHT THOUSAND NINE HUNDRED
NINETY-SIX and 15/100 DOLLARS ($48,996.15) each, plus accrued but unpaid interest, and a
seventh (7"') and fina1 installment of principa1 in the amount of FORTY-ElGHf rnOUSAND
NlNE HUNDRED NlNETY-SIX and 19/100 DOLLARS ($48,996.19) on October 20,2006, on
which date accrued but tUlpaid interest and all charges, fees and other sums under this Note shall be
due and immediately payable in full.
2. Interest. Interest shall accrue on the unpaid principal balance of this Note at a
floating rate of inteIest equal to the Prime Rate as reported in The Wall Street Journal on the dale of
this Note or on the applicable adjustment date, as the case may be, plus two and one-half percent ..
(2.5%). The interest rate under this Note sba1l be adjusted on the twentieth (20") day of each month
hereunder. If the date of this Note or any adjustment date shall be a day on which The Wall Street
Journal does not report the prime Rate, then the Prime Rate shall be determined as of the most
recent date on which it was reported by The Wall Street Journal.
3. Late Pavment Cha.n!e. If any payment due hereunder is received by the Holder
more than ten (10) calendar days after its due date, the Maker shall pay a late payment charge equal
to five percent (5%) of the amount then due.
4. Apnlication ofPavments. All payments made hereunder shall be applied first to late
payment charges or other sums owed to the Holder and then to interest and next to principal, or in
such other order or proportion as the Holder, in the Holder's sole and absolute discretion. may elect
from time to time.
5. Prenavment. The Maker may, at its option, prepay this Note, in whole or in part,
without penalty or additional interest at any time; provided that any such prepayment shall not be
taken or construed as a substitution for regularly scheduled payments and partial prepayments shall
UlnA ~~ 1
.
be applied against the rem~lnlng installments required to be paid hereunder in the inverse order of
the maturity thereof.
6. Event of Default. It shall be an Event of Default under this Note if any payment due
hereunder is not received by the Holder within ten (10) calendar days after its due date.
7. Acceleration. Upon an Event of Default, the amount outstanding on this Note,
together with all charges, fees or other sums shall, at the option of the Holder, without notice or
demand, become immediately due and payable.
8. Confession of Judoment. UPON AN EVENT OF DEFAULT, THE MAKER
AUTHORIZES ANY A'ITORNEY ADMITfED TO PRACTICE BEFORE ANY COURT
OF RECORD IN THE UNITED STATES TO APPEAR ON BEHALF OF THE MAKER IN
ANY COURT IN ONE OR MORE PROCEEDINGS, OR BEFORE ANY CLERK
THEREOF OR PROTHONOTARY OR OTHER COURT omCIAL, AND TO CONFESS
JUDGMENT AGAINST THE MAKER, WITHOUT PRIOR NOTICE OR OPPORTUNITY
OF THE MAKER FOR PRIOR HEARING, 'IN FAVOR OF THE HOLDER OF THIS
NOTE IN THE FULL AMOUNT DUE ON THIS NOTE (INCLUDING PRINCIPAL,
INTEREST AND ANY AND ALL PENALTIES, FEES AND COSTS) PLUS REASONABLE
ATIORNEYS' FEES AND COURT COSTS. THE MAKER WAIVES THE BENEFIT OF
ANY ,AND EVERY STATUTE, ORDINANCE OR RULE OF COURT WlDCH MAY BE
LAWFULLY WAIVED CONFERRING UPON IT ANY RIGHT OR PRIVILEGE OF
EXEMYTION, HOMESTEAD RIGHTS, STAY OF EXECUTION OR GARNISHMENT,
OR SUPPLEMENTARY PROCEEDINGS, OR OTHER RELIEF FROM THE
ENFORCEMENT OR IMMEDIATE ENFORCEMENT OF A JUDGMENT OR RELATED
PROCEEDINGS ON A JUDGMENT. IF A COpy OF TIUS NOTE, VERIFIED BY AN
omCIAL OR AN OFFICER OF TIlE HOLDER, SHALL BE FILED IN ANY
PROCEEDING OR ACTION WHEREIN JUDGMENT IS TO BE CONFESSED, IT
SHALL NOT BE NECESSARY TO FILE THE ORIGINAL HEREOF AND SUCH
VERIFIED COPIES SHALL BE SUFFICIENT wARRANT FOR ANY ATTORNEY OF
ANY COURT OF RECORD TO APPEAR FOR AND CONFESS JUDGMENT AGAINST
MAKER AS PROVIDED HEREIN. JUDGMENT MAY BE CONFESSED FROM TIME
TO TIME UNDER TIlE AFORESAID POWERS AND NO SINGLE EXERCISE IN THE
AFORESAID POWERS TO CONFESS JUDGMENT, OR A SERIES OF JUDGMENTS,
SHALL BE DEEMED TO EXHAUST THE POWER, WHETHER OR NOT SUCH
EXERCISE SHALL BE HELD BY ANY SUCH COURT TO BE INVALID, VOIDABLE OR
VOID, BUT THE POWER SHALL coNTINUE UNDIMINISHED AND IT MAY BE
EXERCISED FROM TIME TO TIME, AND IN THE SAME OR DIFFERENT
JURISDICTIONS, AS, AFl'ER AND AS THE HOLDER SHALL ELECT, UNTll.. SUCH
TIME AS THE HOLDER SHALL HAVE RECEIVED PAYMENT IN FULL OF ALL
SUMS DUE HEREUNDER.
9. Interest Rate After JudfUllent. If judgment is entered against the Maker on this Note,
the amoWlt of the judgment entered (which may include principal, interest, charges, fees and other
sums) shall bear interest at the rate of interest specified in Section 2 of this Note from the date of the
entry of the judgment.
-2-
.
13. Waiver of Defects. The Maker hereby waives and releases all errors, defects and
imperfections of a procedural nature in any proceedings instituted by the Holder hereunder, as well
as all benefits that might accrue to the Maker by virtue of any present or future laws exempting any
property, real or personal, or any part of the proceeds arising from any sale of any such property,
from garnishment, attachment, levy or sale under execution, or providing for any stay of execution,
exemption from civil process, or extension of time for payment The Maker agrees that any real
estate that may be levied upon pursuant to any writ of execution issued on any judgment by virtue
hereof, may be sold, in whole or in part, in any order desired by the Holder.
10. Expenses of Collection. Should this Note be referred to an attorney for collection,
whether or not judgment has been confessed or suit has been filed, the Maker shall pay all of the
Holder's reasonable costs, fees (including, but not limited to, reasonable attorneys' fees) and
expenses resulting from such referral.
11. Subseauent Holders. In the event that any Holder of this Note transfers this Note for
value, the Maker agrees that no subsequent Holder of this Note shall be subject to any claims or
defenses which the Maker may have against a prior Holder, all of which are waived as to the
subsequent Holder, and that all subsequent Holders shall have all of the rights of a Holder in due
course with respect to the Maker even though the subsequent Holder may not qualify, under
applicable law, absent this paragraph, as a Holder in due course.
12. Holder. As used in this Note, the term Holder shall rete to the Payee, and to any
other person, if any, who is in possession of this Note and to whom this Note has been indorsed,
whether to order, to bearer or in blank.
14. Waiver of Protest. The Maker, and all parties to this Note, whether maker, indorser
or guarantor, waive presentment, notice of dishonor and protest.
15. Extensions of Maturity. All parties to this Note, whether maker, indorser or
guarantor, agree that the maturity of this Note, or any payment due hereunder, may be extended at
any time or from time to time without releasing, discharging or affecting the liability of such party.
16. Notices. Any notice or demand required or permitted by or in connection with this
Note shall be deemed validly given if in writing and delivered by certified mail, return receipt
requested, addressed as follows:
(a) If to Payee:
William Keen
Keen Transport, Inc.
P.O. Box 389
New Kingstown, PA 17072
-3-
Patrick Crowe
2560 S. Ocean Blvd.
Suite 710
Palm Beach, FL 33480
(b) If to Maker:
Notwithstanding anything to the contrary, all notices and demands for payment from the
Holder actually received in writing by the Maker shall be considered to be effective against the
Maker upon the receipt thereof, regardless of the procedure or method utilized to accomplish
delivery thereof to the Maker.
17. Assilmabilitv. This Note may be assigned by the Payee or any Holder at any time or
from time to time. The Payee or Holder shall notify the Maker, as soon as practicable, of the
assignment, but any failure to so notify shall not in any manner affect the obligations of the Maker
to make any and all payments required hereunder.
18. Bindinl! Nature. This Note shall inure to the benefit of and be enforceable by the
Payee and the Payee's legal representatives, successors and assigns and any other person to whom
the Payee may grant an interest in the Maker's obligations to the Payee, and shall be binding and
enforceable against the Maker and the Maker's legal representatives, heirs and assigns.
19. Invalidity of anY Part. If any provision or part of any provision of this Note shall for
any reason be held invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Note and this Note shall be construed as
if such invalid, illegal or unenforceable provision or part thereof had never been contained herein,
but only to the extent of its invalidity, illegality or unenforceability.
20. Choice of Law. This Note shall be governed, construed and interpreted strictly in
accordance with the laws of the Commonwealth of Pennsylvania
MAKER HAS BEEN INFORMED BY THE PAYEE THAT SECTION 8 OF TIllS NOTE
PROVIDES. FOR THE REMEDY OF CONFESSION OF JUDGMENT AND CONTAINS A
WANER OF RIGHTS OF THE MAKER, IF ANY, TO NOTICE AND TO BE HEARD BEFORE
THE ENTRY OF ANY SUCH JUDGMENT OR EXECUTION THEREON. MAKER
ACKNOWLEDGES THAT MAKER IS REPRESENTED BY COUNSEL, AND THAT
COUNSEL HAS REVIEWED WITH AND EXPLAINED TO MAKER THE MEANING OF THE
REMEDY OF CONFESSION OF JUDGMENT AND THE WANER OF RIGHTS CONTAINED
THEREIN.
MAKER HEREBY ACKNOWLEDGES THAT BY SIGNING TIllS NOTE MAKER IS
FREELY, KNOWINGLY AND VOLUNTARILY AGREEING TO THE INCLUSION OF THE
CONFESSION OF JUDGMENT REMEDY IN TIllS NOTE AND THE WAIVER OF RIGHfS
CONTAINED THEREIN.
-4-
.
MAKER:
VAUGHAN TRANSPORTATION
SERVICES, INC.
It.;pi
I
i....j
;_&-:::"(."_- , &it {.
President
By:
MAKER ACKNOWLEDGES THAT THIS NOTE ARISES OUT OF A BUSINESS
TRANSACTION AND IS NOT MADE FOR HOUSEHOLD OR CONSUMER PURPOSES.
IN WITNESS WHEREOF, the Maker has caused this Note to be executed on its behalf
by its duly authorized representative, specifically intending this Note to constitute an instrument
under seal.
-5-
I
(
c
LEASE AGREEMENT
TillS LEASE AGREEMENT ("Lease") is made as of August _, 2005 by and
between VAUGHAN TRANSPORT, INC. ("Lessor"), having a place of business at P.O. Box
389, New Kingston, Pennsylvania 17072 and VAUGHAN TRANSPORTATION SERVICES,
INe. ("Lessee"), having its chief executive office at 2560 S. Ocean Boulevard, Suite 710, Palm
Beach, Florida 33480.
IN CONSIDERATION of the mutual agreements set forth in this Lease, the
parties agree as follows:
1. PropertY Leased. Lessee agrees to lease from Lessor the personal property
described in Schedule A attached hereto and made a part hereof, together with all replacement
parts, additions, repairs, accessions, attachments and accessories thereto (collectively,
"Equipment").
2. Term of Lease. The term of this Lease shall commence on the date set forth
above and expire on August 1, 2010, unless sooner tenninated in accordance with the terms and
conditions of this Lease (the "Term").
3. Rent~ Delinquent Payments. Lessee shall pay to Lessor rent ("Rent") for the lease
of the Equipment during the Term in the aggregate amount of $5,500,000.00 as follows:
(a) $300,000.00 upon the execution and delivery of this
Lease by Lessee; and
(b) $5,200,000.00 in sixty (60) equal consecutive monthly
installment payments, together with interest thereon at the rate of eight percent
(8%) per annum, each in the amount of $105,437.25, beginning September 1,
2005 and continuing on the first day of each successive month thereafter, with
the sixtieth (60th) and final payment due August 1, 2010, provided that the
amount of such monthly installment payments shall be subject to adjustment
from time to time pursuant to Section 17 hereof.
All Rent and other amounts due under the Lease (collectively, "Payments") shall be paid at
Lessor's place of business shown above, or such other place as Lessor may designate in writing
to Lessee. In the event that any Payments are not made when due, Lessee shall pay to Lessor (i)
an amount equal to 5% of any such late Payment and (ii) interest on any such late Payment
commencing thirty (30) days from the due date thereof until the date'paid at the lesser rate of
1.5% per month or the maximum rate permitted by applicable law ("Late Payment Rate").
4. Net Lease: Lease Irrevocability. This Lease shall constitute a net lease. The
obligation of Lessee to make Payments due under the Lease shall be absolute and unconditional
under all circumstances, notwithstanding any defect in the title, right to use, condition, operation,
fitness for use, damage or destruction of or to the Equipment or any interruptions or cessations in
570121.3
5. Title: Recording. The Equipment is and shall remain the personal property of
Lessor. Lessee shall have no right, title or interest in the Equipment except as expressly
provided in this Lease. Lessee shall keep the Equipment free of all liens and encumbrances. In
the event that the Lease is deemed to be a Lease creating a security interest, Lessee hereby grants
to Lessor a security interest in the Equipment and all proceeds thereof as security for all of
Lessee's obligations owing under the Lease, as well as all other present and future indebtedness
of Lessee to Lessor of every kind and nature. Lessee agrees that such security interest is
intended to be a purchase money security interest. Lessee will deliver to Lessor signed financing
statements' or other documents Lessor requests to protect its interest in the Equipment. LESSEE
HEREBY AUTHORIZES LESSOR TO FILE A COpy OF TillS MASTER LEASE AS A
FINANCING STATEMENT AND APPOINTS LESSOR OR ITS DESIGNEE AS LESSEE'S
ATTORNEY-IN-FACT TO EXECUTE AND FILE, ON LESSEE'S BEHALF, FINANCING
STATEMENTS AND ANY OTHER DOCUMENTS OR INSTRUMENTS REASONABLY
REQUESTED BY LESSOR TO PERFECT LESSOR'S INTEREST IN THE LEASE, THE
EQUIPMENT AND ALL PAYMENTS DUE HEREUNDER.
use or possession for any reason whatsoever. All Rent shall be paid without notice or demand
and without abatement, deferment, reduction, setoff, counterclaim, defense or deduction of any
amount for any reason whatsoever. This Lease cannot be terminated or canceled for any reason
except as expressly provided herein.
6. No Warranties by Lessor: Manufacturer's Warranties. Lessor, not being the
manufacturer of the Equipment, MAKES NO wARRANTY OR REPRESENTATION, EITHER
EXPRESS OR IMPLIED, AS TO THE FITNESS, QUALITY, DESIGN, CONDITION,
CAPACITY, SUITABILITY, MERCHANTABILITY OR PERFORMANCE' OF THE
EQUIPMENT OR OF THE MATERIAL OR WORKMANSHIP THEREOF OR WITH
RESPECT TO PATENT INFRINGEMENT OR THE LIKE, IT :BEING AGREED THAT THE
EQUIPMENT IS LEASED "AS IS" AND THAT ALL SUCH RISKS, AS BETWEEN LESSOR
AND LESSEE, ARE TO BE BORNE BY LESSEE AT ITS SOLE RISK AND EXPENSE.
Lessor shall have no obligation to install, erect, test, adjust, maintain, support, or service the
Equipment, or provide instruction regarding its use. Lessor transfers to Lessee for the Term of
this Lease any warranties made by the manufacturer. Lessee agrees that Lessee will not assert
against Lessor any claim or defense that Lessee has against the manufacturer.
7 . Use: Maintenance: Return. Lessee will keep and use the Equipment only in the
ordinary course of business. At Lessee's own cost and expense, Lessee will keep the Equipment
eligible for any manufacturer's certification, in compliance with all applicable laws and in good
condition, except for ordinary wear and tear. Lessee will not make any alterations, additions, or
replacements to the Equipment without Lessor's prior written consent. All alterations, additions,
and replacements will become part of the Equipment and Lessor's property at no cost or expense
to Lessor. Lessor may inspect the Equipment at any reasonable time. Unless Lessee purchases
or trades-in the Equipment in accordance with this Lease, upon the, expiration or earlier
termination of this Lease, Lessee shall return all of the Equipment by delivering it to such place,
or on such carrier, for shipping, in the United States as Lessor shall direct. At the time of return,
the Equipment shall be (i) in the same condition as when delivered to Lessee, reasonable wear
and tear excepted, (ii) eligible for the manufacturer's standard maintenance agreement without
- 2-
.
8. Loss and Damage. Lessee is responsible for any loss, theft or destruction of, or
damage to, the Equipment (collectively "Loss") from any and every cause whatsoever, whether
or not insured, from the date of this Lease until delivery of the Equipment to Lessor at the end of
the Lease. Lessee is required to make all Payments even if there is a Loss. Lessee must notify
Lessor in writing immediately of any Loss. Lessee shall determine in the exercise of its
reasonable judgment whether Lessee will (a) repair the Equipment so that it is in good condition
and working order, eligible for any manufacturer's certification, or (b) pay Lessor the full
amount of the insurance proceeds received by Lessee, to be applied as a partial pre-payment of
the Rent due pursuant to Paragraph 3(b). After payment of the insurance proceeds to Lessor the
amount of the monthly installment payment set forth in Paragraph 3(b) shall be adjusted in
recognition of the partial pre-payment of the aggregate amount due thereunder.
the need for repair or rehabilitation, and (iii) free and clear of all liens and encumbrances.
Lessee shall be responsible for all transportation, packing, assembly, installment, insurance,
testing, dismantling and other charges incurred in connection with the delivery, installation, use,
maintenance, and return of the Equipment. Lessee shall, upon the request of Lessor, and at
Lessee's own expense, firmly affix to the Equipment, in a conspicuous place, a label, or metal
plate (or other appropriate marking) as shall be supplied by Lessor showing Lessor as the owner
of the Equipment.
9. Insurance. Lessee will maintain at Lessee's expense (a) all risk property
insurance against the loss, theft or destruction of, or damage to, the Equipment for its full
replacement value, naming Lessor as loss payee, and (b) comprehensive commercial general
liability insurance for third party bodily injury and property damage insurance, naming Lessor as
an additional insured. Lessee will give Lessor original certificates or other evidence of such
insurance when requested. such insurance (a) will be in a form and amount and with companies
acceptable to Lessor, (b) will provide that Lessor will be given 30 days advance notice of any
cancellation or material change of such insurance, and (c) will provide that a violation of the
terms, conditions or warranties of the policy(ies) by Lessee will not invalidate the insurance
insofar as Lessor's interests are concerned. If Lessee does not give Lessor evidence of insurance
acceptable to Lessor, Lessor shall have the right, but not the obligation, to obtain insurance
covering Lessor's interest in the Equipment for the term of the Lease, including any renewals or
extensions, from an insurer of Lessor's choice. Lessor may add the costs of acquiring and
maintaining such insurance and Lessor's fees for Lessor's services in placing and maintaining
such insurance (collectively, "Insurance Charge") to the amounts due from Lessee under this
Lease. Lessee will pay the Insurance Charge to Lessor upon demand. If Lessor purchases
insurance, Lessee will cooperate with Lessor's insurance agent with respect to the placement of
insurance and the processing of claims. Lessor will not be responsible for premiums or any
representations or warranties made by Lessee to any insurer. Nothing in this Lease will create an
insurance relationship of any type between Lessor and any other person. Lessee acknowledges
that Lessor is not required to secure or maintain any insurance, and Lessor will not be liable to
Lessee if Lessor terminates any insurance coverage that Lessor may arrange. If Lessor replaces
or renews any insurance coverage, Lessor is not obligated to provide replacement or renewal
coverage under the same terms, costs, limits, or conditions as the previous coverage.
- 3 -
11. Lessor's Performance of Lessee's Obligations. In the event that Lessee shall fail
to perform any of its obligations under the Lease, Lessor may, at its option, perform the same for
the account of Lessee without thereby waiving such default, and any amount paid or expense
(including reasonable attorneys' fees), penalty or other liability incurred by Lessor in such
performance, together with interest thereon at the Late Payment Rate until paid by Lessee to
Lessor, shall be payable by Lessee upon demand as additional Rent for the Equipment. If a
check is dishonored due to insufficient funds, Lessee shall pay to Lessor a returned check fee,
not to exceed the maximum permitted by law, which fee shall be equal to the aggregate amount
of all actual costs and expenses incurred by Lessor, including, without limitation, bank. charges.
The returned check fee shall be payable by Lessee upon demand as additional Rent for the
Equipment.
10. Taxes. Lessee shall pay, and shall indemnify and hold Lessor harmless from and
against, on an after-tax basis, all fees, taxes, withholdings, assessments and other governmental
charges, together with any penalties, fines or interest, if any, thereon (collectively, the
"Impositions") which are at any time levied or imposed against Lessor, Lessee, the Lease, or the
Equipment by any federal, state, local or foreign government or taxing authonty upon or with
respect to (i) the Equipment, the Lease, or the interest of the Lessor therein, or (ii) the purchase,
ownership, delivery, leasing, possession, maintenance, use, operation, return, sale or other
disposition of the Equipment or any part thereof, or (iii) the Payments or earnings payable under
the Lease; excluding, however, federal, state or local taxes based on or measured by the net
income of Lessor. Lessor (i) shall pay, and promptly upon receipt of Lessor's invoice therefore,
Lessee shall reimburse Lessor for paying, any Impositions, and (ii) in case any report or return is
required to be filed with respect to any Impositions, Lessor will make such report or return to
show Lessor's ownership of the Equipment. Lessor and Lessee may instead agree in writing that
Lessee will pay any Impositions directly or file any such reports or returns. Lessee's obligations
under this paragraph shall survive the expiration or earlier termination of this Lease.
12. Default. The occurrence of any of the following shall constitute a "Default"
under the Lease: (a) Lessee fails to pay any Payment within the (10) days of its due date, (b)
Lessee does not perform any of Lessee's other obligations under the Lease or in any other
agreement with Lessor or with any of Lessor's affiliates and this failure continues for fifteen (15)
days after Lessor has notified Lessee of it, (c) Lessee ceases doing business as a going concern,
becomes insolvent, dissolves or is dissolved, fails to pay its debts as they mature, assigns its
assets for the benefit of Lessee's creditors, or Lessee enters (voluntarily or involuntarily) any
bankruptcy or reorganization proceedings, (d) within sixty (60) days after the commencement of
any proceedings against Lessee seeking reorganization, liquidation, dissolution or similar relief
under any present or future law or regulation, such proceedings shall not have been dismissed, or
within sixty (60) days after the appointment, without Lessee's consent or acquiescence, of any
trustee, receiver or liquidator of Lessee or of all or any substantial part of Lessee's assets and
properties, such appointment shall not have been vacated, ( e) Lessee attempts to sell, transfer,
encumber, part with possession of or sublease the Equipment or any item thereof, (f) Lessee
defaults in the payment or performance of any obligation or indebtedness of any kind or
description, whether direct, indirect, absolute or contingent, due or to become due, now existing
or hereafter arising owing to Lessor or to any of its affiliates, (g) any warranty, representation or
statement made or furnished to Lessor by or on behalf of Lessee in or in connection with the
-4-
Lease proves to have been false in any material respect when made or furnished, or (h) any
guarantor of the Lease dies, does not perform its obligations under the guaranty, or becomes
subject to one of the events listed in subparagraph (c) above.
13. Remedies on Default. If a Default occurs, Lessor may do one or more of the
following: (a) Lessor may cancel or terminate this Lease or any or all other agreements that
Lessor has entered into with Lessee; (b) Lessor may require Lessee to immediately pay Lessor,
as compensation for loss of a bargain and not as a penalty, a sum equal to (i) all unpaid Payments
for the remainder of the Term, plus (ii) all other amounts due or that become due under the
Lease, whereupon Lessor shall transfer Lessor's interest in the Equipment to Lessee "AS IS,
WHERE IS," AND WITHOUT REPRESENTATIONS OR WARRANTIES OF ANY KIND,
EXPRESS OR IMPLIED, other than the warranty that the Equipment is free and clear of all liens
created by Lessor; (c) Lessor may require Lessee to deliver the Equipment to Lessor as set forth
in Paragraph 7; (d) Lessor or its agent may peacefully repossess the Equipment without court
order and Lessee will not make any claims against Lessor for damages or trespass or any other
reason; and (e) Lessor may exercise any other right or remedy available at law or in equity. No
remedy shall be exclusive of any other remedy, but each shall be cumulative and in addition to
every other remedy. Lessee agrees to pay all of Lessor's costs of enforcing Lessor's rights
against Lessee, including reasonable attorneys' fees. If Lessor takes possession of the
Equipment, Lessor may sell or otherwise dispose of it with or without notice, at a public or
private sale, and apply the net proceeds (after Lessor has deducted all costs related to the sale or
disposition of the Equipment) to the amounts that Lessee owes. Lessee agrees that if notice of
sale is required by law to be given, 10 days' notice shall constitute reasonable notice. Lessee
will remain responsible for any amounts that are due after Lessor has applied such net proceeds.
14. Indemnity. Lessee is responsible for and agrees to indemnify and hold Lessor
harmless from any (a) losses, damages, penalties, claims, suits and actions caused by or related
to the manufacture, installation, ownership, use, lease, possession, or delivery of the Equipment;
or any breach of the Lease (collectively, "Claims"), and (b) all costs and reasonable attorneys'
fees incurred by Lessor relating to any Claim. Lessee agrees to reimburse Lessor for and if
Lessor requests, to defend Lessor, at Lessee's own cost and expense, against any Claims. Lessee
agrees that Lessee's obligations under this Paragraph 14 shall survive the termination of this
Lease.
15. Assignment. LESSEE MAY NOT ASSIGN, SELL, TRANSFER OR
SUBLEASE THE EQUIPMENT OR LESSEE'S INTEREST IN THIS LEASE WITHOUT THE
EXPRESS PRlOR WRITTEN CONSENT OF LESSOR THERETO, WHICH SHALL NOT BE
UNREASONABLY WITHHELD. Lessor may, without notifying Lessee, sell, assign, or
transfer this Lease or Lessor's rights in the Equipment. Lessee agrees that the new owner will
have the same rights and benefits that Lessor has under this Lease but none of Lessor's
obligations. The rights of the new owner will not be subject to any claim, defense or set-off that
Lessee may have against Lessor or the manufacturer.
16. purchase Qotion. At any time during the Term, or at the expiration of the Term,
Lessee shall have the option to purchase all, but not less than all, of the Equipment upon giving
at least thirty (30) days prior written notice to the Lessor, but not less than 60 days prior written
- 5 -
17. Trade-Ins. In the event that, during the Term, Lessee desires to trade-in any
specific item of Equipment in connection with Lessee's purchase of a replacement therefor,
Lessee shall pay to Lessor the fair market value of such item whereupon Lessor shall transfer
Lessor's interest in the item to Lessee or to Lessee's designee "AS IS, WHERE IS," AND
WITHOUT WARRANTIES OR REPRESENTATIONS OF ANY KIND, EXPRESS OR
lJ\.1PLIED, other than the Warranty that such item is free and clear of all liens created by Lessor.
Upon receipt of payment of the fair market value of the item from Lessee, Lessor shall apply the
amount thereof to the reduction of the outstanding balance of the Rent under section 3(b) and
shall recalculate the amount of the monthly installment payments thereunder in order to assure a
level amortization of the resulting outstanding balance over the remainder of the Term. For the
purposes hereof, "fair market value" shall mean the aggregate amount of cash and/or credit paid
and/or accorded to the Lessee on the trade-in of an item of Equipment in connection, with
Lessee's purchase of a replacement therefor.
notice if the purchase is to occur at any time during the last sixty (60) days of the Term. It shall
be a condition precedent to the Lessee's purchase of the Equipment that Lessee shall have paid in
full all Payments. The purchase price shall be $1.00. Upon fulfillment of the herein stated
conditions precedent and payment of the purchase price, Lessor shall transfer Lessor's interest in
the Equipment to Lessee "AS IS, WHERE IS", AND WITHOUT WARRANTIES OR
REPRESENTATIONS OF ANY KIND, EXPRESS OR lJ\.1PLIED, other than the warranty that
the Equipment is free and clear of all liens created by Lessor, and this Lease will thereupon
terminate.
18. Article 2A of the Uniform Commercial Code. Lessee agrees that if Article 2A-
Leases of the Uniform Commercial Code applies to this Lease, this Lease will be considered a
"finance lease" as that term is defined in Article 2A. LESSEE, HOWEVER,
ACKNOWLEDGES THAT LESSOR DID NOT MANUFACTURE, SUPPLY OR SELECT
FOR LESSEE THE EQUIPMENT AND THAT LESSEE SELECTED THE EQUlPMENT
BASED UPON ITS OWN JUDGMENT AND LESSEE EXPRESSLY DISCLAIMS ANY
RELIANCE ON ANY STATEMENT MADE BY LESSOR REGARDING THE EQUIPMENT
EXCEPT AS EXPRESSLY SET FORTH HEREIN. ACCORDINGLY, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, LESSEE WAIVES AS INAPPLICABLE TO THE
TRANSACTIONS CONTEMPLATED BY THIS LEASE ANY AND ALL RIGHTS AND
REMEDIES CONFERRED UPON LESSEE BY OR ARISING UNDER SUBCHAPTER B,
CHAPTER 2A5 OF ARTICLE 2A BY REASON OF LESSOR'S ALLEGED F AlLURE TO
DELNER THE EQUIPMENT IN CONFORMITY WITH THIS LEASE AS
CONTEMPLATED BY SECTION 2A-509, LESSEE'S RIGHT TO REJECT THE
EQUIPMENT PURSUANT TO SECTION 2A-509, AND LESSEE'S RIGHT TO REVOKE
ACCEPTANCE OF THE EQUIPMENT PURSUANT TO SECTION 2A-5l7.
19. Ouiet Eniovment. Lessor covenants that if, and so long as, Lessee performs all
obligations due by Lessee under this Lease, then Lessee shall quietly possess the Equpment.
20. Lessee's Representations and Warranties. Lessee represents and warrants, as of
the date of the Lease, that (i) Lessee is duly organized, validly existing and in good standing
under the laws of the state of its incorporation or organization, and is qualified to do business
- 6-
21. Miscellaneous. Lessee shall execute and deliver to Lessor, upon Lessor's request,
such instruments and assurances as Lessor deems necessary or advisable for the confirmation of
the Lease and Lessor's rights thereunder. Lessee agrees that Lessor is authorized, without notice
to Lessee, to supply missing information or correct obvious errors in the Lease. All notices shall
be given in writing and shall be delivered to the other party personally, by private courier, or by
mail, postage prepaid at its address shown herein or to such other address as directed in writing
by such party. It is the express intent of the parties not to violate any applicable usury laws or to
exceed the maximum amount of time price differential or interest, as applicable, permitted to be
charged or collected by applicable law, and any such excess payment will be applied to
Payments in inverse order of maturity, and any remaining excess will be refunded to Lessee, A
waiver of a Default or of a provision of the Lease on one occasion shall not be a waiver of a
Default or of a provision of the Lease on any other occasion. If any portion of the Lease is
invalid or unenforceable it shall be deemed omitted but shall not invalidate or render
unenforceable the remaining provisions of the Lease. The Lease shall be binding upon and inure
to the benefit of Lessor, Lessee, and their successors and permitted assigns. Paragraph headings
are for convemence only and shall not be construed as part of the Lease. This Lease shall be
construed in accordance with the laws of the Commonwealth of Pennsylvania.
where necessary to carry on its business and operations and own its property, and (ii) the Lease
has been duly authorized, executed and delivered by Lessee and constitutes the legal, valid and
binding obligation ,of Lessee, enforceable in accordance with its terms.
THE LEASE REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES,
EMBODIES THE ENTIRE AGREEMENT AND UNDERSTANDING BETWEEN THE
PARTIES HERETO, SUPERCEDES ALL PRIOR AGREEMENTS AND
UNDERSTANDINGS RELATING TO THE SUBJECT MATTER HEREOF, AND MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN
ORAL AGREEMENTS BETWEEN THE PARTIES. THIS LEASE MAY NOT BE
, ALTERED, MODIFIED, TE~ATED OR DISCHARGED EXCEPT BY A WRITIN'G
SIGNED BY THE PARTY AGAINST WHOM SUCH ALTERATION, MODIFICATION,
TERMINATION OR DISCHARGE IS SOUGHT.
LESSOR AND LESSEE WANE THE RIGHT TO A TRIAL BY JURY OF ANY MATTERS
ARISING OUT OF THE LEASE OR ANY OTHER AGREEMENT EXECUTED IN'
CONNECTION THEREWITH.
wARRAN'I OF, ATTORNEY FOR CONFESSION OF JUDGMENT. UPON THE
OCCURRENCE .OF A DEFAULT, THE LESSEE AUTHORIZES ANY ATTORNEY
ADMITTED TO PRACTICE BEFORE ANY COURT OF RECORD IN' THE UNITED STATES
TO APPEAR ON BEHALF OF THE LESSEE IN ANY COURT IN ONE OR MORE
PROCEEDINGS, OR BEFORE ANY CLERK THEREOF OR PROTHONOTARY OR OTHER
COURT OFFICIAL, AND TO CONFESS JUDGMENT AGAINST THE LESSEE, WITHOUT
PRIOR NOTICE OR OPPORTUNITY OF THE LESSEE FOR PRIOR HEARING, IN FAVOR
OF THE LESSOR OF TIllS NOTE IN THE' FULL AMOUNT OF THE PAYMENTS DUE
UNDER THIS LEASE PLUS REASONABLE ATTORNEYS' FEES AND COURT COSTS.
- 7 -
THE LESSEE WANES THE BENEFIT OF ANY AND EVERY STATUTE, ORDINANCE OR
RULE OF COURT WIDCH MAY BE LAWFULLY WAIVED CONFERRING UPON IT ANY
RIGHT OR PRIVILEGE OF EXEMPTION, HOMESTEAD RIGHTS, STAY OF EXECUTION
OR GARNISHMENT, OR SUPPLEMENTARY PROCEEDINGS, OR OTHER RELIEF FROM
THE ENFORCEMENT OR IMMEDIATE ENFORCEMENT OF A JUDGMENT OR RELATED
PROCEEDINGS ON A JUDGMENT. IF A COpy OF TIDS LEASE, VERIFIED BY AN
OFFICIAL OR AN OFFICER OF THE LESSOR, SHALL BE Fll...ED IN ANY PROCEEDING
OR ACTION WHEREIN JUDGMENT IS TO BE CONFESSED, IT SHALL NOT BE
NECESSARY TO Fll...E THE ORIGINAL HEREOF AND SUCH VERIFIED COPIES SHALL
BE SUFFICIENT wARRANT FOR ANY ATTORNEY OF ANY COURT OF RECORD TO
APPEAR FOR AND CONFESS JUDGMENT AGAINST LESSEE AS PROVIDED HEREIN.
JUDGMENT MAY BE CONFESSED FROM TIME TO TIME UNDER THE AFORESAID
POWERS AND NO SINGLE EXERCISE IN THE AFORESAID POWERS TO CONFESS
JUDGMENT, OR A SERIES OF JUDGMENTS, SHALL BE DEEMED TO EXHAUST THE
POWER, WHETHER OR NOT SUCH EXERCISE SHALL BE HEW BY ANY SUCH COURT
TO BE INVALID, VOIDABLE OR VOID, BUT THE POWER SHALL CONTINUE
UNDIMINISHED AND IT MAY BE EXERCISED FROM TIME TO TIME, AND IN THE
SAME OR DIFFERENT JURISDICTIONS, AS, AFTER AND AS THE LESSOR SHALL
ELECT, UNTll... SUCH, TIME AS THE LESSOR SHALL HAVE RECEIVED PAYMENT IN
FULL OF ALL SUMS DUE HEREUNDER.
LESSEE HAS BEEN INFORMED BY THE LESSOR THAT THE FOREGOING WARRANT
OF ATTORNEY FOR CONFESSION OF JUDGMENT CONTAINS A WANER OF RIGHTS
OF THE LESSEE, IF ANY, TO NOTICE AND TO BE HEARD BEFORE THE ENTRY OF ANY
SUCH JUDGMENT OR EXECUTION THEREON. LESSEE ACKNOWLEDGES THAT
LESSEE IS REPRESENTED BY COUNSEL, AND THAT COUNSEL HAS REVIEWED WITH
AND EXPLAINED TO LESSEE THE MEANING OF THE WARRANT OF ATTORNEY FOR
CONFESSION OF JUDGMENT AND THE WANER OF RIGHTS CONTAINED THEREIN.
LESSEE HEREBY ACKNOWLEDGES THAT BY SIGNING TIllS LEASE LESSEE IS
FREELY, KNOWINGLY AND VOLUNTARILY AGREEING TO THE INCLUSION OF THE
WARRANT OF ATTORNEY FOR CONFESSION OF JUDGMENT IN TIDS LEASE AND THE
WANER OF RIGHTS CONTAINED THEREIN.
LESSEE ACKNOWLEDGES THAT THIS LEASE ARISES OUT OF A BUSINESS
TRANSACTION AND IS NOT MADE FOR HOUSEHOLD OR CONSUMER PURPOSES.
[signatures appear on following page]
- 8 -
IN WITNESS WHEREOF, each of the parties hereto, intending to be legally
bound, has caused this Lease to be executed on its respective behalf by its duly authorized
representative all as of the date first written above.
LESSOR:
VAUGHAN TRANSPORT, INe
By:
w~
President
LESSEE:
VAUGHAN TRANSPORTATION SERVICES,
INC.
By:
President
- 9-
#
-
By:
President
IN WITNESS WHEREOF, each of the parties hereto, intending to be legally
bound, has caused this Lease to be executed on its respective behalf by its duly authorized
representative all as of the date first written above.
LESSOR:
VAUGHAN TRANSPORT, INC.
LESSEE:
VAUGHAN TRANSPORTATION SERVICES,
INC.
By:
~
President
-9-
Schedule A
Equipment
[to be attached]
Vaughan Transport, Inc.
Tractors
Schedule A
Page L
3 1989 OTA TY130 00000000000063960 1989
4 1994 ISU TT -100 T1E4L1DOSK1AA2121 1994 6BTA5.9C
7 2003 Caocity TJ5000 4LMBF21103L013696 2003 CUM
90 1999 VOL VNL64T 4VG7DACF1XN762265 1999 CAT 3406E
91 1999 VOL, VNL64T 4VG7DACF3XN762266 1999 CAT 3406E
92 1999 VOL VNL64T 4VG7DACF5XN762267 1999 CAT 3406E
93 1999 VOL VNL64T 4VG7DACF9XN762269 1999 CAT 3406E
94 1999 VOL VNL64T 4VG7DACF7XN762268 1999 CAT 3406E
95 1999 VOL VNL64T 4VG7DARF9XN780309 1999 DET 00560
96 1999 VOL VNL64T 4VG7DARF5XN780310 1999 DET 00560
97 1999 VOL VNL64T 4VG7DARF7XN780311 1999 DET DDS60
164 1998 VOL VNL64T 4VG7DARJ7WN762555 1998 DET 560
166 1998 VOL VNL64T 4VG7DARJOWN762557 1998 DET 560
167 1999 VOL VNL64T 4VG7DARJ3XN77 4543 1999 DET 560
168 1999 VOL VNL64T 4VG7DARJ5XN774544 1999 DET 560
169 1999 VOL VNL64T 4VG7DARJ7XN77 4545 1999 DET 560
170 1999 VOL VNL64T 4VG7DARJ9XN774546 1999 DET 560
173 1999 VOL VNL64T 4VG7DARJ4XN774549 1999 DET 560
176 1999 VOL VN64T60 4VG7DARJ4XN774552 1999 DET 560
178 1999 PBT 378 1XPFDB9XOXN493782 1999 CAT 3406E
183 1999 PBT 378 1XPFDB9XXXN493787 1999 CAT 3406E
184 1999 PBT 378 1 XPFDB9X 1 XN493788 1999 CAT 3406E
185 1999 PBT 378 1XPFDB9X3XN493789 1999 CAT 3406E
187 2000 PST 378 1XPFDS9XXYN493791 2000 CAT 3406E
190 2000 PST 378 1 XPFDS9XOYN493797 2000 CAT 3706E
191 2000 PST 378 1 XPFDS9X2YN493798 2000 CAT 3406E
192 2000 PST 378 1 XPFDS9X4YN493799 2000 CAT 3406E
193 2000 PST 378 1XPFDS9X7YN493800 2000 CAT 3406E
195 2000 PST 378 1XPFDS9XOYN493802 2000 CAT 3406E
196 2000 PST 378 1XPFDS9X2YN493803 2000 CAT 3406E
197 2001 PST 378 1XPFDS9X71 N554973 2001 CAT C-15
198 2001 PST 378 1XPFD9X91YN508068 2001 CAT C-15
199 2001 PST 378 1 XPFDS9X31 N508069 2001 CAT C-15
200 2000 PST 378 1XPFDS9X7YN508070 2000 CAT C-15
201 2001 PST 378 1 XPFDS9X91 N554974 2001 CAT C-15
202 2001 PST 378 1 XPFDS9X31 N508072 2001 CAT C-15
203 2001 PST 378 1 NP5GGGG80D5761 09 2001 CAT C-15
204 2001 PST 378 1XPFDS9X21N554976 2001 CAT C-15
205 2001 PST 378 1XPFDS9X41N554977 2001 CAT C-15
206 2001 PST 378 1XPFDS9X61N554978 2001 CAT C-15
o
Vaughan Transport, Inc.
Tractors
Schedule A
Page 2..
207 2001 PST 378 1XPFDS9X41N567695 2001 CAT C-15
208 2001 PST 378 1XPFDS9X61N567696 2001 CAT C-15
209 2001 PST 378 1XPFDS9X81N567697 2001 CAT C-15
210 2001 PST 378 1XPFDS9X81N567698 2001 CAT C-15
211 2001 PST 378 1XPFDS9X11N567699 2001 CAT C-15
212 2001 PST 378 1XPFDS9X41N567700 2001 CAT C-15
213 2001 PST 378 1 XPFDS9X61 N567701 2001 CAT C-15
215 2004 PST 378 1XPFDS9X34D812738 2004 CAT C15
216 2004 PST 378 1 XPFDS9X54D812739 2004 CAT C15
217 2004 PST 378 1XPFDS9X14D812740 2004 CAT C15
218 2004 PST 378 1XPFDS9X34D812741 2004 CAT C15
219 2004 PST 378 1 XPFDS9X54D8127 42 2004 CAT C15
220 2004 PST 378 1XPFDS9X74D812743 2004 CAT C15
221 2004 PST 378 1 XPFDS9X94D8127 44 2004 CAT C15
222 2004 PST 378 1XPFDS9X04D812745 ' 2004 CAT C15
223 2004 PST 378 1XPFDS9X24D812746 2004 CAT C15
224 2004 PST 378 1XPFDS9X44D812747 2004 CAT C15
225 2004 PST 378 1 XPFDS9X64D8127 48 2004 CAT C15
226 2004 PST 378 1 XPFDS9X84D8127 49 2004 CAT C15
227 2005 PST 378 840061 2005 CAT C15
228 2005 PST 378 840062 2005 CAT C15
229 2005 PST 378 840063 2005 CAT C15
230 2005 PST 378 840064 2005 CAT C15
231 2005 PST 378 840065 2005 CAT C15
232 2005 PST 378 840066 2005 CAT C15
233 2005 PST 378 840067 2005 CAT C15
234 2005 PST 378 840068 2005 CAT C15
235 2005 PST 378 840069 2005 CAT C15
236 2005 PST 378 840070 2005 CAT C15
237 2005 PST 378 840071 2005 CAT C15
238 2005 PST 378 840072 2005 CAT C15
239 2005 PST 378 840073 2005 CAT C15
240 2005 PST 378 840074 2005 CAT C15
1540 1998 PST 378 1XPFDS9XXWD454671 1998 CAT 3406E
1760 1999 PST 378 1XPFDS9X4YN508284 1999 CAT - 3406E
1980 2001 PST 378 1XPFDS9X91N567806 2001 CAT C-15
Vaughan Transport Inc. Schedule A
Trailers Page ~
Unit Year Make Serial Number Sus ension Len th
510 1986 Great Dane 1 GRAA9620GS1 08203 Spring 48
517 1990 Dorsey 1DTV41Z22LA193665 Spring 48
518 1988 Great Dane 1GRAA9621JS133019 Spring 48
519 1990 Great Dane 1 GRAA9628LBOO2818 Spring 48
520 1990 Great Dane 1 GRAA9626LB002820 Spring 48
521 1990 Great Dane 1 GRAA9626LBOO2817 Spring 48
522 1990 Great Dane 1 GRAA9624LBOO2816 Spring 48
523 1990 Great Dane 1 GRAA962XLB002819 Spring 48
524 1985 Great Dane 1GRAA9628FS144901 Spring 48
527 1989 Dorsey 1 DTV41Z28KA185777 Spring 48
528 1989 Dorsey 1 DTV41 Z2XKA 185778 Spring 48
529 1991 Dorsey 1 DTV41 Z23MA201 046 Spring 48
530 1992 Great Dane 1 GRAA9627NS042701 Spring 48
531 1992 Great Dane 1 GRAA9629NS042702 Spring 48
532 1992 Great Dane 1 GRAA9620NS042703 Spring 48
533 1992 Great Dane 1 GRAA9622NS042704 Spring 48
535 1993 Great Dane 1 GRAA9622PS069002 Spring 48
536 1993 Great Dane 1 GRAA9626PS069004 Spring 48
537 1993 Great Dane 1 GRAA9628PS069005 Spring 48
538 1993 Great Dane 1 GRAA9624PS069003 Spring 48
539 1993 Great Dane 1 GRAA9620PS069001 Spring 48
540 1993 Great Dane 1GRAA9622PS074703 Spring 48
541 1993 Great Dane 1 GRAA9629PS074701 Spring 48
542 1993 Great Dane 1 GRAA9624PS074704 Spring 48
543 1993 Great Dane 1GRAA9626PS074705 Spring 48
544 1993 Great Dane 1 GRAA9620PS074702 Spring 48
546 1993 Great Dane 1GRAA962XPB142746 Spring 48
547 1993 Great Dane 1GRAA9621PB142750 Spring 48
548 1994 Dorsey 1 DTV521 RA218899 Spring 53
554 1995 Great Dane 1GRAA9628SB083110 Spring 48
555 1995 Great Dane 1 GRAA9622SB0831 04 Spring 48
557 1995 GreatDane 1 GRAA9626SB0831 06 Spring 48
558 1995 Great Dane 1 GRAA9624SB0831 05 Spring 48
559 1995 Great Dane 1 GRAA9620SB0831 03 Spring 48
560 1995 Great Dane 1 GRAA9628SB0831 07 Spring 48
561 1995 Great Dane 1 GRAA962XSB0831 08 Spring 48
562 1995 Great Dane 1 GRAA9621 SB0831 09 Spring 48
563 1995 Great Dane 1 GRAA9629SB0831 02 Spring 48
564 1995 Great Dane 1 GRAA0621 SB084062 Spring 53
565 1988 Great Dane 1 GRAA0623SB084063 Spring 53
566 1988 Great Dane 1 GRAA0625SB084064 Spring 53
567 1995 Great Dane 1 GRAA0627SB084065 Spring 53
568 1995 Great Dane 1 GRAA0629SB084066 Spring 53
574 1995 Great Dane 1 GRAA9623SS076615 Spring 48
575 1993 Great Dane 1 GRAA0629PS098301 Spring 53
576 1995 Dorsey 1DTV11523SA231966 Spring 53
578 1995 Dorsey 1DTV11529SA231972 Spring 53
579 1995 Dorsey 1DTV11525SA231970 Spring 53
Vaughan Transport Inc.
Trailers
Unit
583
584
587
588
589
590
591
592
593
594
595
596
597
598
599
603
604
605
606
607
608
609
610
611
612
616
617
618
619
620
621
622
623
624
625
627
628
629
630
631
632
633
634
635
636
637
638
639
Year Make
1988 Great Dane
1988 Great Dane
1996 Trailmobile
1996 Trailmobile
1996 Trailmobile
1996 Trailmobile
1996 Trailmobile
1996 DorSey
1996 Dorsey
1996 Dorsey
1996 Dorsey
1996 Dorsey
1995 Great Dane
1995 Great Dane
1995 Great Dane
1997 Great Dane
1997 Great Dane
1997 Great Dane
1997 Great Dane
1997 Great Dane
1997 Walbash
1997 Walbash
1997 Walbash
1997 Walbash
1997 Walbash
1998 Walbash
1998 Walbash
1998 Walbash
1998 Walbash
1998 Walbash
1998 Walbash
1998 Walbash
1998 Walbash
1998 Walbash
1998 Walbash
1998 Manon
1998 Manon
1998 Manon
1998 Manon
1998 Manon
1998 Manon
1998 Manon
1998 Manon
1998 Manon
1999 Great Dane
1999 Great Dane
1999 Great Dane
1999 Great Dane
Serial Number Suspension
1GRAA9626JS149801 Spring
1 GRAA9622JS0901 02 Spring
1 PT01 JAH9T9000814 Air
1 PT01 JAH7T9000794 Air
1 PT01 JAH3T9007922 Air
1 PT01 JAH5T9007923 Air
1 PT01 JAH7T9007924 Air
1DTV11Z21TA241049 Air
1 DTV11 Z28T A241 050 Air
1 DTV11 Z28T A241 047 Air
1 DTV11 Z26T A241046 Air
1 DTV11 Z2XT A241048 Air
1GRAA962SB153530 Air
1GRAA62XSB153531 Air
1GRAA9621SB153532 Air
1 GRAA0626VS038201 Spring
1 GRAA062XVS038203 Spring
1 GRAA0621 VS038204 Spring
1 GRAA0628VS038202 Spring
1 GRAA0623VS038205 Spring
1 JJV532U4VL417286 Spring
1 JJV532U6VL417287 Spring
1 JJV532UXVL417289 Spring
1 JJV532U8VL417288 Spring
1 JJV532U6VL417290 Spring
1 JJV532W8WL449791 Spring
1 JJV532WXWL449792 Spring
1JJV532W1WL449793 Spring
1 JJV532W3WL449794 Spring
1 JJV532W5WL449795 Spring
1JJV532WXWL449789 Spring'
1 JJV532W6WL449790 Spring
1 JJV532W7WL449796 Spring
1 JJV532W9WL449797 Spring
1 JJV532WOWL449798 Spring
1 NNVA532AWM299389 Spring
1 NNVA5327WM299390 Spring
1 NNVA5329WM299391 Spring
1 NNV A5320WM299392 Spring
1 NNV A5322WM299393 Spring
1 NNVA5324WM299394 Spring
1 NNVA5326WM299395 Spring
1 NNVA5328WM299396 Spring
1 NNVA532XWM299397 Spring
1 GRAA0629XB0461 03 Spring
1GRAA0620XB046104 Spring
1GRAA0622XB046105 Spring
1 G RAA0624XB0461 06 Spring
Schedule A
Page ..!i-
Length
48
48
53
53
53
53
53
53
53
53
53
53
48
48
48
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
53
Vaughan Transport Inc. Schedule A
Trailers Page .:S.-
Unit Year Make Serial Number Sus ension Len th
640 1999 Great Dane 1 GRM0626XB0461 07 Spring 53
641 1999 Great Dane 1 GRAA0628XB0461 08 Spring 53
642 1999 Great Dane 1 GRM062XXB0461 09 Spring 53
643 1999 Great Dane 1GRM0626XB046110 Spring 53
644 1999 Great Dane 1GRM0628XB046111 Spring 53
645 1999 Great Dane 1 GRAA062XXB046112 Spring 53
646 1999 Great Dane 1GRM0621XB046113 Spring 53
647 1999 Great Dane 1GRAA0623XB046114 Spring 53
648 1999 Great Dane 1 GRM0625XB046115 Spring 53
649 1999 Great Dane 1GRM0627XB046116 Spring 53
650 1999 Great Dane 1 GRM0629XB046117 Spring 53
651 1999 Great Dane 1 GRM0620XB046118 Spring 53
652 1999 Great Dane 1 GRM0622XB046119 Spring 53
653 1999 Great Dane 1GRAA0629XB046120 Spring 53
654 1999 Great Dane 1 GRM0620XB046121 Spring 53
655 1999 Great Dane 1GRAA0622XB046122 Spring 53
657 1999 Great Dane 1 GRAA0626XB046124 Spring 53
658 1999 Great Dane 1 GRAA0628XB046125 Spring 53
659 1999 Great Dane 1 GRM0625XB0461 01 Spring 53
660 1999 Great Dane 1 GRM0627XB0461 02 Spring 53
661 1999 Great Dane 1 PNV532B5XG31 0855 Spring 53
662 1999 Great Dane 1 PNV532B7XG31 0856 Spring 53
663 1999 Great Dane 1 PNV532B9XG31 0857 Spring 53
664 1999 Great Dane 1 PNV532BOXG31 0858 Spring 53
665 1999 Great Dane 1 PNV532B2XG31 0859 Spring 53
666 1999 Great Dane 1 PNV532B9XG31 0860 Spring 53
667 1999 Great Dane 1 PNV532BOXG31 0861 Spring 53
668 1999 Great Dane 1 PNV532B2XG31 0862 Spring 53
669 1999 Great Dane 1 PNV532B4XG31 0863 Spring 53
670 1999 Great Dane 1 PNV532B6XG31 0864 Spring 53
671 1999 Great Dane 1 PNV532B8XG31 0865 Spring 53
672 1999 Great Dane 1 PNV532BXXG31 0866 Spring 53
673 1999 Great Dane 1 PNV532B1XG31 0867 Spring 53
674 1999 Great Dane 1 PNV532B3XG31 0868 Spring 53
675 1999 Great Dane 1 PNV532B5XG31 0869 Spring 53
676 1999 Great Dane 1 PNV532B 1 XG31 0870 Spring 53
677 1999 Great Dane 1 PNV532B3XG31 0871 Spring 53
678 1999 Great Dane 1 PNV532B5XG31 0872 Spring 53
679 1999 Great Dane 1 PNV532B7XG31 0873 Spring 53
680 1999 GreatDane 1 PNV532B9XG31 0874 Spring 53
681 1999 Great Dane 1 PNV532BOXG31 0875 Spring 53
682 1999 Great Dane 1 PNV532B2XG31 0876 Spring 53
683 1999 Great Dane 1 PNV532B4XG31 0877 Spring 53
684 1999 Great Dane 1 PNV532B6XG31 0878 Spring 53
685 1999 Great Dane 1 PNV532B8XG31 0879 Spring 53
686 1999 Great Dane 1 PNV532B4XG31 0880 Spring 53
687 1999 Great Dane 1 PNV532B6XG31 0881 Spring 53
688 1999 Great Dane 1 PNV532B8XG31 0882 Spring 53
Vaughan Transport Inc. Schedule A
Trailers Page -'-
Unit Year Make Serial Number Suspension Length
689 1999 Great Dane 1 PNV5328XXG31 0883 Spring 53
690 1999 Great Dane 1 PNV532B1XG31 0884 Spring 53
691 1999 Great Dane 1 PNV532B3XG31 0885 Spring 53
692 1999 Great Dane 1 PNV532B5XG31 0886 Spring 53
693 1999 Great Dane 1 PNV532B7XG31 0887 Spring 53
694 1999 Great Dane 1 PNV53289XG31 0888 Spring 53
695 1999 Great Dane 1 PNV532BOXG31 0889 Spring 53
696 1999 Great Dane 1 PNV532B7XG31 0890 Spring 53
697 1999 Great Dane 1 PNV532B9XG31 0891 Spring 53
698 1999 Great Dane 1 PNV532BOXG31 0892 Spring 53
699 1999 Great Dane 1 PNV532B2XG31 0893 Spring 53
700 1999 Great Dane 1 PNV532B4XG31 0894 Spring 53
701 1999 Great Dane 1 PNV532B6XG31 0895 Spring 53
702 1999 Great Dane 1 PNV532B8XG31 0896 Spring 53
703 1999 Great Dane 1 PNV532BXXG31 0897 Spring 53
704 1999 Great Dane 1 PNV532B1XG31 0898 Spring 53
705 1999 Great Dane 1 PNV532B3XG31 0899 Spring 53
706 1999 Great Dane 1 PNV532B6XG31 0900 Spring 53
708 1999 Great Dane 1 PNV532BXXG31 0902 Spring 53
709 1999 Great Dane 1 PNV532B1XG31 0903 Spring 53
710 1999 Great Dane 1 PNV532B3XG31 0904 Spring 53
711 1999 Great Dane 1 PNV532B5XG31 0905 Spring 53
712 2000 Dorsey 1 DTV11525Y A282619 Spring 53
713 2000 Dorsey 1DTV11529YA282577 Spring 53
714 2000 Dorsey 1 DTV11521 Y A282505 Spring 53
715 2000 Dorsey 1 DTV11526YA282516 Spring 53
716 2000 Dorsey 1DTV11521YA282603 Spring 53
717 2000 Dorsey 1DTV11528YA282548 Spring 53
718 2000 Dorsey 1DTV11522YA284246 Spring 53
719 2000 Dorsey 1 DTV11525Y A284239 Spring 53
720 2000 Dorsey 1DTV11529YA284227 Spring 53
721 2000 Dorsey 1 DTV11526Y A284220 Spring 53
722 2000 Dorsey 1DTV11523YA284210 Spring 53
723 2000 Dorsey 1 DTV11529Y A282672 Spring 53
724 2000 Dorsey 1 DTV11524Y A282658 Spring 53
725 2000 Dorsey 1 DTV11522Y A282545 Spring 53
726 2000 Dorsey 1DTV11529YA284230 Spring 53
727 2000 Dorsey 1 DTV11528Y A284249 Spring 53
728 2000 Dorsey 1 DTV11527Y A282489 Spring 53
729 2000 Dorsey 1DTV11520YA282544 Spring 53
730 2000 Dorsey 1 DTV11528Y A282632 Spring 53
731 2000 Dorsey 1 DTV11524Y A282644 Spring 53
732 1999 Hyundai 3H3V532C6XT004005 Air 53,
733 1999 Hyundai 3H3V532C1XT004008 Air 53
734 1999 Hyundai 3H3V532C3XT004012 Air 53
735 1999 Hyundai 3H3V532C5XT004013 Air 53
736 2004 Dorsey 1FTV115274A301844 Air 53
737 2004 Dorsey 1DTV115294A301845 Air 53
Vaughan Transport Inc. Schedule A
Trailers Page -'1-
Unit Year Make Serial Number Sus ension Len th
738 2004 Dorsey 1DTV115204A301846 Air 53
739 2004 Dorsey 1DTV115224A301847 Air 53
740 2004 Dorsey 1 DTV115244A301848 Air 53
741 2004 Dorsey 1 DTV115264A30 1849 Air 53
742 2004 Dorsey 1DTV115224A301850 Air 53
743 2004 Dorsey 1 DTV115244A301851 Air 53
744 2004 Dorsey 1DTV115264A301852 Air 53
745 2004 Dorsey 1DTV115284A301853 Air 53
746 2004 Dorsey 1 DTV1152X4A301854 Air 53
747 2004 Dorsey 1DTV115214A301855 Air 53
748 2004 Dorsey 1DTV115234A301856 Air 53
749 2004 Dorsey 1DTV115254A301857 Air 53
750 2004 Dorsey 1 DTV11527 4A301858 Air 53
751 2004 Dorsey 1DTV115294A301859 Air 53
752 2005 Vanguard 5V8VA53215M500162 Air 53
753 2005 Vanguard 5V8VA53235M500163 Air 53
754 2005 Vanguard 5V8VA53255M500164 Air 53
755 2005 Vanguard 5V8V A53255M500181 Air 53
756 2005 Vanguard 5V8VA53275M500182 Air 53
757 2005 Vanguard 5V8VA53295M500183 Air 53
758 2005 Vanguard 5V8VA53205M500184 Air 53
759 2005 Vanguard 5V8VA53225M500185 Air 53
760 2005 Vanguard 5V8VA53245M500186 Air 53
761 2005 Vanguard 5V8VA53265M500187 Air 53
762 2005 Vanguard 5V8VA53285M500188 Air 53
763 2005 Vanguard 5V8VA532X5M500189 Air 53
764 2005 Vanguard 5V8VA53265M500190 Air 53
765 2005 Vanguard 5V8V A53285M500191 Air 53
766 2005 Vanguard 5V8VA532X5M500192 Air 53
767 2005 Vanguard 5V8VA53215M500193 Air 53
768 2005 Vanguard 5V8V A53235M500 194 Air 53
769 2005 Vanguard 5V8VA53255M500195 Air 53
770 2005 Vanguard 5V8VA53275M500196 Air 53
771 2005 Vanguard 5V8VA53295M500197 Air 53
772 2005 Vanguard 5V8V A53205M500198 Air 53
773 2005 Vanguard 5V8VA53225M500199 Air 53
774 2005 Vanguard 5V8VA53255M500200 Air 53
[
:D
TIllS SECURITY AGREEMENT (this "Agreement"), is made as of August 1,2005, by
and between VAUGHAN TRANSPORTATION SERVICES, lNC. (the "Debtor') and
VAUGHAN TRANSPORT, lNC. (the "Secured Party").
RECITALS
SECURITY AGREEMENT
A. Debtor and Secured Party have entered into that certain Asset Purchase Agreement
dated July 1, 2005 pursuant to which Debtor has agreed to purchase and Secured Party has agreed
to sell certain assets of Secured Party in accordance with the tenns and conditions of the Asset
Purchase Agreement.
B. Debtor has executed and delivered to Secured Party Debtor's Tenn Note dated
August 1, 2005 in the principal amount of $220,000.00 pursuant to which Debtor has agreed to
make the installment payments provided for therein with respect to the purchase price of certain
assets under the Asset Purchase Agreement.
C. In order to induce Secured Party to accept the Tenn Note and installment payment
of the purchase price, Debtor has offered to grant to the Secured Party a security interest in the
Debtor's assets.
AGREEMENTS
In order to induce the Secured Party to accept the Term Note and the installment payment of
the purchase price, the Debtor hereby agrees with the Secured Party, for the Secured party's benefit,
intending to be legally bound hereby, as follows:
1. Grant of Security Interest.
To secure the prompt and complete payment, observance and performance of all of
the obligations of the Debtor under the Tenn Note, (as the same may be amended, increased,
modified, renewed, refinanced, refunded or extended from time to time) any and all sums advanced
by the Secured Party to preserve or protect the Collateral (as hereinafter defined), the value of the
Collateral or to preserve, protect or perfect the Secured Party's security interest in the Collateral;
any and all expenses of retaking, holding, preparing for sale, selling or otherwise disposing of or
realizing upon any or all of the Collateral upon an Event of Default or the exercise by the Secured
party of its rights upon an Event of Default, together with reasonable attorneys fees, expenses of
collection, and court costs; and, any other indebtedness or liability of the Debtor to the Secured
Party, whether direct or indirect, joint or several, absolute or contingent, contemplated or
uncontemplated, now existing or hereafter arising (collectively, the "Obligations"), the Debtor
hereby grants to the Secured Party, for the Secured Party's benefit, a security interest in all of the
Debtor's right, title and interest in and to all of its assets and personal property, whether now owned
570472,2
General Intangibles: All "general intangibles" and "payment intangibles" as defined
in the DCC, including, without limitation, all rights, interests, chooses in action, causes of actions,
claims, general intangibles and all other intangible property of the Debtor of every kind and nature
(other than Accounts in which a security interest is granted above and patents and trademarks) due
from or in respect of any Person, including, without limitation, all corporate and other business
records; all filings with Governmental Authorities (defined to mean any nation or government, any
state or other political subdivision thereof, any entity exercising, executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government and any court or arbitrator),
all loans, royalties, and other obligations receivable; all inventions, designs, trade secrets, computer
programs, "software" as defined in the DCC, printouts and other computer materials; all licenses,
franchises, customer lists, credit files and correspondence; all rights under license and franchise
agreements, and other contracts and contract rights; all interest in partnerships and joint ventures;
all tax refunds and tax refund claims; all right, title and interest under leases, subleases, licenses and
concessions and other agreements relating to personal property; all payments due or made to the
Debtor in connection with any requisition, confiscation, condemnation, seizure or forfeiture of any
property by any Person or Governmental Authority; all "deposit accounts" as defined in the DCC;
or existing or hereafter arising or acquired and wherever located, but excluding "accounts" as
defined in the DCC (collectively, the "Collateral") including, without limitation:
Inventory: All "inventory" as defined in the DCC, including, without limitation, all
goods now owned and hereafter acquired by the Debtor (wherever located, whether in the
possession of the Debtor or of a bailee or other Person, whether for sale, storage, transit, processing,
use or otherwise and whether consisting of whole goods, spare parts, components, supplies,
materials, or consigned, returned or repossessed goods) which are held for sale or lease or to be
furnished (or have been furnished) under any contract of service or which are finished goods, raw
materials, work in process or materials used or consumed in the Debtor's businesses, in each case
whether now owned or hereafter acquired; and all accessions and additions thereto, substitutions
and replacements therefor, and the products and Proceeds thereof (collectively, the "Inventory");
Equipment: All "equipment" as defined in the DCC, including, without limitation,
all equipment, all machinery, manufacturing, distribution, selling, data processing, office and other
equipment used or useful in the Debtor's business or otherwise owned by the Debtor, all furniture,
furnishings, works of art, appliances, fixtures and trade fixtures, tools, vehicles, vessels, aircraft and
all other goods of every type and description, in each case whether now owned or hereafter acquired
and wherever located, and all additions and accessions thereto, substitutions and replacements
therefor, and products and Proceeds thereof (collectively, the "Equipment");
Chattel Paper. Instruments. PromisSOry Notes and Documents: All "chattel paper",
"electronic chattel paper", "instruments", "promissory notes" and "documents" as defined in the
DCC, and all payments thereunder and instruments and other property (other than real property)
from time to time delivered in respect thereof or in exchange therefor, and all bills of lading,
warehouse receipts and other documents of title, in each case whether now owned or hereafter
acquired; and all additions and accessions thereto, substitutions and replacements therefor, and the
products and Proceeds thereof (collectively, the "Chattel Paper, Instruments, Promissory Notes and
Documents");
- 2-
As used herein, the term "Proceeds" shall have the meaning assigned to it under
Article 9 of the DCC and, to the extent not otherwise included, shall include, but not be limited to,
(i) any and all proceeds of any insurance causes and rights of action or settlements thereof,
escrowed amounts or property, judicial and arbitration judgments and awards, payable to the Debtor
from or in respect of any Person from time to time whether or not with respect to the Collateral; (ii)
any and all payments (in any form whatsoever) made or due and payable to the Debtor from time to
time in connection with any requisition, confiscation, condemnation, seizure or forfeiture of all or
any part of the Collateral by any Governmental Authority; (iii) all claims of the Debtor for losses or
damages arising out of or relating to or for any breach of any agreements, covenants,
representations or warranties or any default whether or not with respect to or under any of the
foregoing Collateral (without limiting any direct or independent rights of the Secured Party with
respect to the Collateral); and (iv) any and all other amounts from time to time paid or payable
under or in connection with the Collateral.
all credits with and other claims against carriers and shippers; all rights to indemnification; all
reversionary interests in pension and profit sharing plans and reversionary, beneficial and residual
interests in trusts; all proceeds of insurance of which the Debtor is a beneficiary; and all "letter of
credit rights" as defined in the DCC, guarantees, liens, security interests and other security held by
or granted to the Debtor; and all other intangible property, whether or not similar to the foregoing,
in each case, whenever and wherever arising, whether now owned or hereafter acquired by the
Debtor; and all additions and accessions thereto, substitutions and replacements therefor, and the
products and Proceeds thereof (collectively, the "General Intangibles");
Other Propertv: All other property or interests in personal property now owned or
hereafter acquired by the Debtor or which now or hereafter may come into the possession, custody
or control of the Secured Party or any agent or affiliate of the Secured Party in any way or for any
purpose (whether for safekeeping, deposit, custody, pledge, transmission, collection or otherwise);
and all rights and interests of the Debtor, whether now existing or hereafter arising and however
and wherever arising, in respect of any and all (i) notes, drafts, letters of credit, stocks, bonds, and
debt and equity securities, whether or not certificated, and warrants, options, puts and calls and
other rights to acquire or otherwise relating to the same; (ii) money; (iii) proceeds of loans; and (iv)
insurance proceeds and books and records relating to any of the property covered by this
Agreement; and all additions and accessions thereto, substitutions and replacements therefor, and
the products and Proceeds thereof (collectively, the "Other Property").
2. Representations and Warranties
The Debtor represents and warrants as follows:
(a) Names; Trade Names. Except as disclosed on Exhibit 2(a), the
Debtor has not, during the preceding five years: (i) been known by any other name or title, (ii) been
the surviving entity of a merger or consolidation, or (iii) acquired all or substantially all of the
property of any other Person. As of the date of this Agreement, the Debtor currently conducts
business only under its name. The Debtor covenants and agrees that it will not hold itself out to the
public or otherwise do business other than under its name as long as any of the Obligations remain
unpaid or unsatisfied.
- 3 -
3. Further Assurances
(b) Jurisdiction of Organization. The Debtor is duly organized, validly
existing and in good standing under the laws of the State of Georgia.
(c) Possession of Equipment and Inventory. The Debtor has exclusive
possession and control of its Equipment and Inventory.
(d) Security Interest. This Agreement creates a valid security interest in
the Collateral, securing the payment of the Obligations. When DCC-l financing statements are
duly filed in the Office of the Secretary of the State of Georgia, all filings and other actions
necessary or desirable to perfect such security interests will have been duly taken, except with
respect to vehicles and real property and other property as to which security interests are not subject
to perfection under the DCC.
(a) The Debtor agrees that from time to time, at its expense, to promptly
execute and deliver all further instruments and documents, and take all further action, that the
Secured Party may reasonably request, in order to perfect and protect any security interests granted
hereby or to enable the Secured Party to exercise and enforce its rights and remedies hereunder with
respect to any Collateral. Without limiting the generality of the foregoing, the Debtor shall
promptly execute and file such financing or continuation statements, or amendments thereto, and
such other instruments or notices, and promptly take such other action as the Secured Party may
reasonably request, in order to perfect and preserve the security interests granted hereby.
(b) The Debtor hereby authorizes the Secured Party to file one or more
financing or continuation statements, and amendments thereto, relative to all or any part of the
Collateral without the signature of the Debtor where permitted by law. The Secured Party shall
provide the Debtor with a copy of any such statement or amendment, provided that no failure to do
so shall affect the rights of the Secured Party hereunder, result in any liability of the Secured Party
to the Debtor or in any way affect the validity of such filing. A photographic, carbon or other
reproduction of this Agreement or any financing statement covering the Collateral or any part
thereof shall be sufficient as a financing statement where permitted by law.
( c) The Debtor shall furnish to the Secured Party from time to time
statements and schedules further identifying and describing the Collateral and such other reports in
connection with the Collateral as the Secured Party may reasonably request, all in reasonable detail.
4. Maintenance of the Collateral
The Debtor shall:
(a) Keep the Collateral at the places specified on Exhibit 4(a). The
Debtor agrees to provide written notice to the Secured Party, upon request, of every location at
which it is then maintaining Collateral.
(b) Maintain or cause to be maintained in good repair, working order
and condition, excepting ordinary wear and tear and damage due to casualty, all of the Collateral,
-4-
6. Other Covenants and Agreements of the Debtor
and make or cause to be made all appropriate repairs, renewals and replacements thereof, to the
extent not obsolete and consistent with past practice of the Debtor or as required by any
Governmental Authority, as quickly as practicable after the occurrence of any loss or damage
thereto which are necessary or desirable to such end. The Debtor shall promptly furnish to the
Secured Party a statement respecting any material loss or damage to any of the Collateral with an
aggregate fair market value exceeding $10,000.00 as a result of a single occurrence.
5. As to Accounts - [Intentionally omitted]
The Debtor covenants and agrees that on and after the date hereof until the
indefeasible cash payment in full of the Obligations, unless the Secured Party shall otherwise
consent in writing:
(a) Defense of Collateral. The Debtor will defend the Collateral against
all claims and demands of all Persons at any time claiming the same or any interest therein adverse
to the interests of the Secured Party.
(b) Security Interest. The Debtor covenants that the security interests
granted hereby constitute and shall at all times constitute continuing perfected first priority security
interests in the Collateral.
(c) Encumbrances; Filings. The Debtor will not (i) further hypothecate,
pledge, encumber, transfer, sell or otherwise suffer to exist a security interest in, or a Lien on, the
Collateral or any portion thereof in favor of any Person other than the Secured Party as provided
herein, or (ii) sign or file or authorize the signing or filing of any document or instrument perfecting
any Lien on the Collateral, except, in each case, Capital Merchant, provided, however, that Capital
Merchant shall, have subordinated its security interest to the security interest of the Secured Party
pursuant to an agreement of subordination in form and substance satisfactory to the Secured Party.
The inclusion of "Proceeds" of the Collateral under the security interest granted herein shall not be
deemed a consent by the Secured party to any sale or other disposition of any Collateral except as
expressly permitted herein.
7. The Secured Party Aooointed Attorney-in-Fact
The Debtor hereby irrevocably appoints the Secured Party, its attorney-in-fact, with
full authority in its place and stead and in its name or otherwise, from time to time after the
occurrence of an Event of Default, in the Secured Party's discretion, to take any action and to
execute any instrument which the Secured Party may deem necessary or advisable to accomplish
the purposes of this Agreement, including, without limitation:
(a) to obtain and reasonably adjust insurance maintained by Debtor on
the Collateral;
- 5 -
- 6-
(b) to ask, demand, collect, sue for, recover, compromise, receive and
give acquittance and receipts for moneys due and to become due under or in respect of any of the
Collateral;
(c) to receive, endorse, and collect any drafts or other Chattel Paper,
Instruments and Documents in connection with clause (a) or (b) above; and
(d) to file any claims or take any action or institute any proceedings
which the Secured Party may deem necessary or desirable for the collection of any of the Collateral
or otherwise to enforce the rights of the Secured Party with respect to any of the Collateral.
8. The Secured Party May Perform
If the Debtor fails to timely perform any agreement contained herein, upon notice to
the Debtor, the Secured Party may itself perform, or cause performance of, such agreement, and the
reasonable expenses of the Secured Party incurred in connection therewith shall be payable by the
Debtor under Section 12.
9. The Secured Partv's Duties
The powers conferred on the Secured Party hereunder are solely to protect its
interest in the Collateral and shall not impose any duty upon it to exercise any such powers. Except
for the safe custody of any Collateral in its possession and the accounting for moneys actually
received by it hereunder, the Secured Party shall have no duty as to any Collateral. The Secured
Party shall be deemed to have exercised reasonable care in the custody and preservation of the
Collateral in its possession if the Collateral is accorded treatment substantially equal to that which
the Secured Party accords its own property, it being understood that the Secured Party shall not be
under any obligation to take any necessary steps to preserve rights against prior parties or any other
rights pertaining to any Collateral, but may do so at its option, and all reasonable expenses incurred
in connection therewith shall be for the sole account of the Debtor and shall be added to the
Obligations.
10. Events of Default
The following shall each constitute an "Event of Default" hereunder:
(a) If any representation or warranty made herein, the Asset Purchase
Agreement or in any other document or agreement executed or delivered by the Debtor in
connection with Asset Purchase Agreement shall prove to have been incorrect or misleading
(whether because of misstatement or omission) in any material respect when made; or
(b) If the Debtor shall fail to observe or perform any term, covenant or
agreement contained in this Agreement and such failure shall have continued unremedied for a
period of 30 days after written notice shall have been given to the Debtor by the Secured Party; or
(c) The occurrence of an Event of Default under and as defined in the
Term Note; or
- 7 -
(d) If the Debtor shall contest or disavow its obligations under this
Agreement or this Agreement shall not remain in full force and effect.
11. ltemedies
Upon the occurrence of an Event of Default or at any time thereafter during the
continuance thereof, the Secured party may exercise any and all remedies and other rights provided
under this Agreement, including, without limitation, the following:
(a) The Secured party may exercise in respect of the Collateral, in
addition to other rights and remedies provided for herein or otherwise available to it, all the rights
and remedies of a secured party upon default under the UCC as in effect from time to time (whether
or not the UCC applies to the affected Collateral) and also may (i) require the Debtor to, and the
Debtor hereby agrees that it will at its expense and upon request of the Secured party forthwith,
assemble all or any part of the Collateral as directed by the Secured party and make it available to
the Secured party at a place designated by the Secured Party which is reasonably convenient to the
Secured Party and the Debtor, (ii) without notice, except as specified below, sell, lease, assign,
grant an option or options to purchase or otherwise dispose of the Collateral or any part thereof in
one or more parcels at public or private sale, at any exchange, broker's board or at any of the
Secured Party's offices or elsewhere, for cash, on credit or for future delivery, and upon such other
terms as may be commercially reasonable. The Debtor agrees that, to the extent notice of sale shall
be required by law, at least ten (10) days' notice to the Debtor of the time and place of any public
sale or the time after which any private sale is to be made shall constitute reasonable notification.
The Secured Party shall not be obligated to make any sale of Collateral regardless of notice of sale
having been given. The Secured Party may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may, without further notice, be
made at the time and place to which it was so adjourned.
(b) Any cash held by the Secured Party as Collateral and all cash
proceeds received by the Secured Party in respect of any sale of, collection from, or other
realization upon all or any part of the Collateral may, in the discretion of the Secured Party, be held
by Secured Party as Collateral for, and/or then or at any time thereafter applied (after payment of
any amounts payable to the Secured Party pursuant to Section 12) in whole or in part by the Secured
Party against all or any part of the Obligations. Any surplus of such cash or cash proceeds held by
the Secured Party and remaining after payment in full of all the Obligations shall be promptly paid
over to the Debtor or to whomsoever may be lawfully entitled to receive such surplus.
( c) The Debtor hereby expressly waives and covenants not to assert any
appraisement, valuation, stay, extension, redemption or similar laws, now or at any time hereafter in
force, which might delay, prevent or otherwise impede the performance or enforcement of this
Agreement.
12. Expenses
The Debtor will, upon demand, pay to the Secured party any and all reasonable
sums, costs and expenses which the Secured party may payor incur pursuant to the provisions of
15. Notices
this Agreement or in negotiating, executing, perfecting; defending, protecting or enforcing this
Agreement or the security interests granted herein or in enforcing payment of the Obligations or
otherwise in connection with the provisions hereof, including, but not limited to court costs,
reasonable collection charges, reasonable travel expenses, and reasonable attorneys' fees, all of
which, together with interest at the highest rate then payable on any of the Obligations, shall be part
of the Obligations.
13. No Segregation ofMonevs: No Interest
No moneys or any other property received by the Secured party hereunder need be
segregated in any manner except to the extent required by law, and any such moneys or other
property may be deposited under such general conditions as may be prescribed by law applicable to
the Secured Party, and the Secured Party shall not be liable for any interest thereon.
14. Amendments. Etc.
No amendment or waiver of any provision of this Agreement or consent to any
departure by the Debtor herefrom shall in any event be effective unless the same shall be in writing
and signed by the Secured Party, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
All notices and other communications provided for hereunder shall be given in the
manner and to the addresses set forth in the Asset Purchase Agreement.
16. Continuing Security Interest: Transfer of Notes: Termination.
This Agreement shall create a continuing security interest in the Collateral and shall
(i) remain in full force and effect until the indefeasible cash payment in full of the Obligations, (ii)
be binding upon the Debtor and its successors and assigns and (iii) inure, together with the rights
and remedies of the Secured Party hereunder, to the benefit of the Secured Party, its successors and
assigns. Nothing set forth herein is intended or shall be construed to give any other Person any
right, remedy or claim under, to or in respect of this Agreement. The Debtor's successors and
assigns shall include, without limitation, a receiver, trustee or debtor-in-possession thereof or
therefor.
17. Other Provisions
(a) No provision of this Agreement may be waived, modified or
otherwise changed by any means, including, without limitation, any course of dealing, course of
performance or trade usage, or oral evidence of any nature, except pursuant to a writing executed by
the party against which enforcement of such waiver, modification or change is sought.
(b) No failure by the Secured Party to exercise, and no delay by the
Secured Party in exercising, any right or remedy hereunder shall operate as a waiver thereof.
- 8 -
19. Consent to Jurisdiction; Service of Process; Waiver of Jury Trial.
( c) Section headings have been inserted herein for convenience only and
shall not be construed to be a part of this Agreement. Unless the context otherwise requires, words
in the singular number include the plural, and words in the plural include the singular.
(d) This Agreement may be executed in any number of counterparts,
each of which shall be an original and all of which shall constitute one agreement. It shall not be
necessary in making proof of this Agreement or of any document required to be executed and
delivered in connection herewith or therewith to produce or account for more than one counterpart
signed by the party to be charged.
( e) Every provision of this Agreement is intended to be severable, and if
any tenn or provision hereof shall be invalid, illegal or unenforceable for any reason, the validity,
legality and enforceability of the remaining provisions hereof or thereof shall not be affected or
impaired thereby, and any invalidity, illegality or unenforceability in any jurisdiction shall not affect
the validity, legality or enforceability of any such tenn or provision in any other jurisdiction.
(f) All Schedules hereto shall be deemed to be a part hereof.
(g) Each and every right, remedy and power granted to the Secured Party
hereunder or allowed at law or by any other agreement shall be cumulative and not exclusive, and
may be exercised by the Secured Party from time to time.
18. Governing Law; Terms
This Agreement shall be governed by and construed in accordance with the laws of
the Commonwealth of pennsylvania without regard to conflicts of laws rules, except to the extent
that the validity or perfection of the security interest hereunder, or remedies hereunder, in respect of
any particular collateral are governed by the laws of a jurisdiction other than the Commonwealth of
Pennsylvania. Terms used in Articles 8 and 9 of the UCC are used herein as therein defined. All
references herein to the tenn 'rucc" shall mean the Uniform Commercial Code as adopted and in
effect under the laws of the Commonwealth of Pennsylvania from time to time. It is the expressed
intent and agreement of the parties hereto that all terms and provisions contained in this Agreement
defined by reference to the UCC or Article 9 be interpreted in accordance with Revised UCC
Article 9 as in effect in the Commonwealth of Pennsylvania from time to time.
(a) The Debtor hereby agrees and consents that any action or proceeding
arising out of or brought to enforce the provisions of this Agreement may be brought in any
appropriate court in Cumberland County, Pennsylvania, and by the execution of this Agreement the
Debtor irrevocably consents to the jurisdiction of such court.
(b) The Debtor and the Secured Party hereby jointly waive trial by jury
in any action or proceeding to which the Debtor and the Secured Party may be parties, arising out
of or in any way pertaining to this Agreement.
- 9-
[signatures appear on following page]
This waiver is knowingly, willingly and voluntarily made by the Debtor. The
Debtor hereby represents that no representations of fact or opinion have been made by any
individual to induce this waiver of trial by jury or to in any way modify or nullify its effect. The
Debtor further represents that it has been represented in the signing of this Agreement and in the
making of this waiver by independent legal counsel, selected of its own free will, and that it has had
the opportunity to discuss this waiver with counsel.
20. Third party Beneficiary
There are no third party beneficiaries of this Agreement.
- 10-
By:
(/&<
-
IN WITNESS WHEREOF, each of the parties hereto have caused this Agreement to be
duly executed and delivered by its officer thereunto duly authorized as of the date first above
written, specifically intending this Agreement to constitute an instrwnent under seal.
DEBTOR:
VAUGHAN TRANSPORTATION SERVICES,
INC.
President
SECURED PARTY:
VAUGHAN TRANSPORT, INC.
By:
President
- 11 -
President
IN WITNESS WHEREOF, each of the parties hereto have caused this Agreement to be
duly executed and delivered by its officer thereunto duly authorized as of the date first above
written, specifically intending this Agreement to constitute an instrument under seal.
DEBTOR:
VAUGHAN TRANSPORTATION SERVICES,
INC.
By:
President
SECURED PARTY:
VAUGHAN TRANSPORT, INC.
By:
w9f--
- 12 -
Exhibit 2(a)
116 Cooley Industrial Way
LaGrange, Georgia
Exhibit 4(a)
E
[
GUARANTY
THIS GUARANTY dated August 1, 2005, is made by PATRICK CROWE and
ELIZABETH CROWE, husband and wife, (the "Guarantors"), in favor of VAUGHAN
TRANSPORT, INC. (the "Payee") to secure the several obligations of VAUGHAN
TRANSPORTATION SERVICES, INC. (the ''Buyer'') pursuant to a certain Lease Agreement
and a certain Term Note, each of even date herewith.
BACKGROUND
WHEREAS, Buyer and Payee are parties to that certain Asset Purchase
Agreement dated July 26, 2005 pursuant to which Buyer agreed to purchase and Payee agreed to
sell certain assets upon the terms and conditions specified therein; and
WHEREAS, pursuant to the Asset Purchase Agreement Buyer executed and
delivered to Payee the Term Note providing for the installment payment of the purchase price for
certain of such assets; and
WHEREAS, pursuant to the Asset Purchase Agreement, Buyer and Payee entered
into the Lease Agreement with respect to the Equipment described therein, which Lease
Agreement provides for Buyer to make certain rental payments to Payee; and
WHEREAS, Patrick Crowe is a principal shareholder of Buyer; and
WHEREAS, in order to induce Payee to enter into such transactions on the terms
and conditions heretofore described, the Guarantors have offered to guaranty to the Payee the
payment and performance of Buyer's obligations under the Term Note and the Lease Agreement.
AGREEMENTS
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and
intending to be legally bound, the Guarantors hereby agree as follows:
1. Guaranty. The Guarantors hereby irrevocably, absolutely and
unconditionally guarantee and become surety for the following obligations and liabilities
(hereinafter collectively referred to as the "Obligations"):
(a) the prompt payment by Buyer, as and when due and
payable, whether by acceleration or otherwise, of all amounts now or hereafter owing by Buyer
under the Term Note, whether for principal, interest, fees, expenses or otherwise;
570430.1
2. Guarantors' Obligations Unconditional.
(b) the prompt payment and performance by Buyer, as and
when due and payable, or dischargeable, whether by acceleration or otherwise, of all amounts,
whether rent, interest, charges, expenses or otherwise, and all other obligations, now or hereafter
owing or to be performed by Buyer under the Lease Agreement; and
( c) any and all expenses, including reasonable attorneys fees,
incurred by the Payee in enforcing its rights under this Guaranty.
(a) The Guarantors hereby guarantee that the Obligations will
be paid and performed strictly in accordance with the terms of the Term Note and the Lease
Agreement, as the case may be.
(b) This Guaranty (i) is a continuing guarantee and shall
remain in full force and effect until all of the Obligations and other expenses guaranteed pursuant
to Section 1 hereof have been paid and performed in full; and (ii) shall continue to be effective or
shall be reinstated, as the case may be, if at any time any payment of any of the Obligations is
rescinded, avoided or rendered void as a preferential transfer, impermissible set-off, fraudulent
conveyance or must otherwise be returned or disgorged by the Payee upon the death, insolvency,
bankruptcy or reorganization of Buyer or any guarantor or otherwise, all as though such
rescinded, avoided or voided payment had not been made, and notwithstanding any action or
failure to act on the part of the Payee in reliance on such payment.
(c) This is a guaranty of payment and performance and not
merely of collection. In the event of any default by Buyer in the payment or performance of any
Obligation, the Guarantors will payor perform all or any portion of Obligations due or thereafter
becoming due or dischargeable, whether by acceleration or otherwise, without defalcation or
offset of any kind, without the Payee first being required t<:> make demand upon Buyer or pursue
any of its rights against Buyer, or against any other person, including other guarantors; and
without being required to liquidate or realize on any collateral security. In any right of action
accruing to the Payee, the Payee may elect to proceed against (a) the Guarantors together with
Buyer; (b) any Guarantor and Buyer individually; or (c) any Guarantor without having first
commenced any action against Buyer.
3. Waivers. The Guarantors hereby waive (i) promptness and diligence; (ii)
notice of default by Buyer; (iii) notice of any actions taken by the Payee or Buyer under the
Term Note, Lease Agreement or any other agreement or instrument relating thereto or executed
in connection therewith; (iv) notice of acceptance of this Guaranty and reliance thereon by the
Payee; (v) presentment, demand of payment, notice of dishonor or nonpayment, protest and
notice of protest with respect to the Obligations, and all other formalities of every kind in
connection with the enforcement of the Obligations or of the obligations of the Guarantors
hereunder or of any other guarantor, the omission of or delay in which, but for the provisions of
this Section 3, might constitute grounds for relieving a Guarantor of its obligations hereunder;
and (vi) any requirement that the Payee exhaust any right or take any action against Buyer, any
-2-
5. Miscellaneous.
Guarantor, or any other person. The obligations of the Guarantors hereunder shall not be
affected or released by any amendment, modification or extension of the Term Note or the Lease
Agreement, or any waiver by the Payee of any of its rights thereunder.
4. Subrogation and Similar Rights. Until all of the obligations are paid in
full, the Guarantors waive any right of subrogation to the claims of the Payee against Buyer, and
any right of indemnification by or contribution from Buyer, arising by reason of any payment
made by a Guarantor hereunder or otherwise. If, notwithstanding such waiver, any amount shall
be paid to a Guarantor on account of such subrogation, indemnification or contribution at any
time when all of the Obligations shall not have been paid in, :full, such amount shall be held in
trust for the benefit of the Payee, shall be ~egregated from the other funds of the Guarantor and
shall forthwith be paid over to the Payee to be applied in whole or in part by the Payee in its
discretion against the Obligations, whether matured or unmatured, in accordance with the terms
of the Term Note or Lease Agreement.
(a) This Guaranty contains the entire agreement of the parties
hereto with respect to the subject matter hereof. No amendment of any provision of this
Guaranty shall be effective unless it is in writing and signed by the Guarantors and the Payee,
and no waiver of any provision of this Guaranty, and no waiver or consent to any departure by
any Guarantor therefrom, shall be effective unless it is in writing and signed by the Payee, and
then such waiver or consent shall be effective only in the specific instance and for the specific
purpose for which given.
(b) No failure on the part of the Payee to exercise, and no delay
in exercising, any right hereunder or under the Term Note, the Lease Agreement or any other
documents or agreements related to or securing the Term Note, the Lease Agreement or this
Guaranty, shall operate as a waiver hereof or thereof; nor shall any single or partial exercise of
any right preclude any other or further -exercise thereof or the exercise of any other right. The
rights and remedies of the Payee provided herein and in the Term Note, the Lease Agreement or
any other documents or agreements related to or securing the Term Note, the Lease Agreement
are cumulative and are in addition to, and not exclusive of, any rights or remedies provided by
law.
(c) This Guaranty shall (i) be binding on the Guarantors and
their legal representatives, heirs and assigns, and (ii) inure, together with all rights and remedies
of the Payee hereunder, to the benefit of the Payee and its successors and assigns.
(d) If any provision hereof shall for any reason be held invalid
or unenforceable, no other provision shall be affected thereby, and this Guaranty shall be
construed as if the invalid or unenforceable provision had never been a part of it.
-3-
( e) This Guaranty shall in all respects be governed by the laws
of the Commonwealth of pennsylvania without regard to the conflict oflaw principles thereof.
(f) If more than one person or entity shall be a guarantor of the
Obligations, whether pursuant to this Guaranty or any other document or agreement, the
obligations of all such guarantors shall be joint and several.
6. CONFESSION OF JUDGMENT. THE GUARANTORS HEREBY
IRREVOCABLY AUTHORIZE AND EMPOWER THE PAYEE, BY ITS ATTORNEY, OR
THE PROTHONOTARY OR THE CLERK OF ANY COURT OF RECORD IN THE
COMMONWEALTH OF PENNSYLVANIA OR IN ANY JURISDICTION WHERE
PERMITTED BY LAW, UPON THE OCCURRENCE OF AN EVENT OF DEFAULT AS
DEFINED IN THE TERM NOTE OR THE LEASE AGREEMENT, OR AT ANY TIME
THEREAFTER THAT SUCH EVENT OF DEFAULT IS CONTINUING, TO APPEAR FOR
THE GUARANTORS AND CONFESS AND ENTER JUDGMENT AGAlNST THEM, OR
EITHER OF THEM, IN FAVOR OF THE PAYEE IN ANY JURISDICTION IN WIDCH THE
GUARANTORS OR ANY OF THEIR PROPERTY IS LOCATED FOR THE AMOUNT OF
ALL OBLIGATIONS, TOGETHER WITH COSTS OF SUIT AND WITH ACTUAL
COLLECTION COSTS (INCLUDING REASONABLE ATTORNEYS' FEES), WITH OR
WITHOUT DECLARATION, AND WITHOUT STAY OF EXECUTION, AND WITH
RELEASE OF ERRORS AND THE RIGHT TO ISSUE EXECUTION FORTHWITH, AND
FOR DOING SO TIllS AGREEMENT OR A COpy VERIFIED BY AFFIDAVIT SHALL BE
A SUFFICIENT wARRANT. THE GUARANTORS HEREBY WAIVE AND RELEASE ALL
RELIEF FROM ANY AND ALL APPRAISEMENT, STAY OR EXEMPTION LAWS OF
ANY STATE NOW IN FORCE OR HEREAFTER ENACTED. THIS AUTHORITY AND
POWER SHALL NOT BE EXHAUSTED BY THE EXERCISE THEREOF AND SHALL
CONTINUE UNTIL THE OBLIGATIONS ARE FULLY PAID, PERFORMED,
DISCHARGED AND SATISFIED.
BEING FULLY AWARE OF THEIR RIGHTS TO PRIOR NOTICE
AND HEARING ON THE VALIDITY OF ANY CLAIMS THAT MAY BE ASSERTED
AGAlNST THEM BY THE PAYEE UNDER THIS AGREEMENT BEFORE JUDGMENT
CAN BE ENTERED, THE GUARANTORS HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THESE RIGHTS AND EXPRESSLY AGREE AND CONSENT
TO THE PAYEE, UPON THE OCCURRENCE OF AN EVENT OF DEFAULT, OR AT ANY
TIME THEREAFfER, ENTERING JUDGMENT AGAINST THE GUARANTORS BY
CONFESSION, WITHOUT PRIOR NOTICE OR OPPORTUNITY FOR A HEARlNG. THE
GUARANTORS ACKNOWLEDGE THAT THEY HAVE HAD THE ASSISTANCE OF
COUNSEL IN THE REVIEW AND EXECUTION OF TIllS AGREEMENT AND FURTHER
ACKNOWLEDGE THAT THE MEANING AND EFFECT OF THE FOREGOING
PROVISIONS CONCERNING CONFESSION OF JUDGMENT HA VB BEEN FULLY
EXPLAINED TO THE GUARANTORS BY SUCH COUNSEL.
-4-
IN WITNESS WHEREOF, the Guarantors have executed this Guaranty as an
instrument under seal, as of the date first above written.
GUARANTORS
~
(Seal)
Patrick Crowe
(Seal)
Elizabeth Crowe
- 5 -
F
F
o
~
GUARANTY
JVrtt:" ,)
TIDS GUARANTY datedMmdr _,2006, is made by PATRICK CROWE and
ELIZABETH CROWE, husband and wife, (the "Guarantors"), in favor of VAUGHAN
TRANSPORT, INC. (the "Payee") to secure the several obligations of VAUGHAN
TRANSPORTATION SERVICES, INC. (the "Maker") pursuant to a certain Term Note, dated
March 2..~ 2006.
BACKGROUND
WHEREAS, Maker and Payee are parties to that certain Term Note dated March
~, 2006 pursuant to which Maker agreed, for value given, to pay Payee the sum of THREE
HUNDRED FORTY -TWO THOUSAND, NINE HUNDRED SEVENTY-THREE DOLLARS
and NINE CENTS ($342,973.09), plus interest, all as is more particularly described in the Term
Note; and
WHEREAS, Patrick Crowe is a principal shareholder of Maker; and
WHEREAS, in order to induce Payee to enter into such transaction on the terms
and conditions heretofore described, the Guarantors have offered to guaranty to the Payee the
payment and performance of Maker's obligations under the Term Note.
AGREEMENTS
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and
intending to be legally bound, the Guarantors hereby agree as follows:
1. Guaranty. The Guarantors hereby irrevocably, absolutely and
unconditionally guarantee and become surety for the following obligations and liabilities
(hereinafter collectively referred to as the "Obligations"):
(a) the prompt payment by Maker, as and when due and
payable, whether by acceleration or otherwise, of all amounts now or hereafter owing by Maker
under the Term Note, whether for principal, interest, fees, expenses or otherwise; and
(b) any and all expenses, including reasonable attorneys fees,
incurred by the Payee in enforcing its rights under this Guaranty.
2. Guarantors' Obligations Unconditional.
(a) The Guarantors hereby guarantee that the Obligations will
be paid and performed strictly in accordance with the terms of the Term Note.
;;.nn..~~ 1
(c) This is a guaranty of payment and performance and not
merely of collection. In the event of any default by Maker in the payment or performance of any
Obligation, the Guarantors will payor perform all or any portion of Obligations due or thereafter
becoming due or dischargeable, whether by acceleration or otherwise, without defalcation or
offset of any kind, without the Payee first being required to make demand upon Maker or pursue
any of its rights against Maker, or against any other person, including other guarantors; and
without being required to liquidate or realize on any collateral security. In any right of action
accruing to the Payee, the Payee may elect to proceed against (a) the Guarantors together with
Maker; (b) any Guarantor and Maker individually; or (c) any Guarantor without having first
commenced any action against Maker.
(b) This Guaranty (i) is a continuing guarantee and shall
remain in full force and effect until all of the Obligations and other expenses guaranteed pursuant
to Section 1 hereof have been paid and performed in full; and (ii) shall continue to be effective or
shall be reinstated, as the case may be, if at any time any payment of any of the Obligations is
rescinded, avoided or rendered void as a preferential transfer, impermissible set-off, fraudulent
conveyance or must otherwise be returned or disgorged by the Payee upon the death, insolvency,
bankruptcy or reorganization of Maker or any Guarantor or otherwise, all as though such
rescinded, avoided or voided payment had not been made, and notwithstanding any action or
failure to act on the part of the Payee in reliance on such payment.
3. Waivers. The Guarantors hereby waive (i) promptness and diligence; (ii)
notice of default by Maker; (iii) notice of any actions taken by the Payee or Maker under the
Term Note or any other agreement or instrument relating thereto or executed in connection
therewith; (iv) notice of acceptance of this Guaranty and reliance thereon by the Payee; (v)
presentment, demand of payment, notice of dishonor or nonpayment, protest and notice of
protest with respect to the Obligations, and all other formalities of every kind in connection with
the enforcement of the Obligations or of the obligations of the Guarantors hereunder or of any
other guarantor, the omission of or delay in which, but for the provisions of this Section 3, might
constitute grounds for relieving a Guarantor of its obligations hereunder; and (vi) any
requirement that the Payee exhaust any right or take any action against Maker, any Guarantor, or
any other person. The obligations of the Guarantors hereunder shall not be affected or released
by any amendment, modification or extension of the Term Note or any waiver by the Payee of
any of its rights thereunder.
4. Subrogation and Similar Ri2hts. Until all of the obligations are paid in
full, the Guarantors waive any right of subrogation to the claims of the Payee against Maker, and
any right of indemnification by or contribution from Maker, arising by reason of any payment
made by a Guarantor hereunder or otherwise. If, notwithstanding such waiver, any amount shall
be paid to a Guarantor on account of such subrogation, indemnification or contribution at any
time when all of the Obligations shall not have been paid in full, such amount shall be held in
trust for the benefit of the Payee, shall be segregated from the other funds of the Guarantor and
shall forthwith be paid over to the Payee to be applied in whole or in part by the Payee in its
discretion against the Obligations, whether matured or unmatured, in accordance with the terms
of the Term Note.
-2-
5. Miscellaneous.
(a) This Guaranty contains the entire agreement of the parties
hereto with respect to the subject matter hereof. No amendment of any provision of this
Guaranty shall be effective unless it is in writing and signed by the Guarantors and the Payee,
and no waiver of any provision of this Guaranty, and no waiver or consent to any departure by
any Guarantor therefrom, shall be effective unless it is in writing and signed by the Payee, and
then such waiver or consent shall be effective only in the specific instance and for the specific
purpose for which given.
(b) No failure on the part of the Payee to exercise, and no delay
in exercising, any right hereunder or under the Term Note or any other documents or agreements
related to or securing the Term Note or this Guaranty, shall operate as a waiver hereof or thereof;
nor shall any single or partial exercise of any right preclude any other or further exercise thereof
or the exercise of any other right. The rights and remedies of the payee provided herein and in
the Term Note, or any other documents or agreements related to or securing the Term Note, are
cumulative and are in addition to, and not exclusive of, any rights or remedies provided by law.
(c) This Guaranty shall (i) be binding on the Guarantors and
their legal representatives, heirs and assigns, and (ii) inure, together with all rights and remedies
of the Payee hereunder, to the benefit of the Payee and its successors and assigns.
(d) If any provision hereof shall for any reason be held invalid
or unenforceable, no other provision shall be affected thereby, and this Guaranty shall be
construed as if the invalid or unenforceable provision had never been a part of it.
(e) This Guaranty shall in all respects be governed by the laws
of the Commonwealth of Pennsylvania without regard to the conflict of law principles thereof.
(f) If more than one person or entity shall be a guarantor of the
Obligations, whether pursuant to this Guaranty or any other document or agreement, the
obligations of all such guarantors shall be joint and several.
6. CONFESSION OF JUDGMENT. THE GUARANTORS HEREBY
IRREVOCABLY AUTHORIZE AND EMPOWER THE PAYEE, BY ITS ATTORNEY, OR
THE PROTHONOTARY OR THE CLERK OF ANY COURT OF RECORD IN THE
COMMONWEALTH OF PENNSYLVANIA OR IN ANY JURISDICTION WHERE
PERMITTED BY LAW, UPON THE OCCURRENCE OF AN EVENT OF DEF AUL T AS
DEFINED IN THE TERM NOTE, OR AT ANY TIME THEREAFTER THAT SUCH EVENT
OF DEF AUL T IS CONTINUING, TO APPEAR FOR THE GUARANTORS AND CONFESS
AND ENTER JUDGMENT AGAINST THEM, OR EITHER OF THEM, IN FAVOR OF THE
PAYEE IN ANY JURISDICTION IN WHICH THE GUARANTORS OR ANY OF THEIR
PROPERTY IS LOCATED FOR THE AMOUNT OF ALL OBLIGATIONS, TOGETHER
WITH COSTS OF SUIT AND WITH ACTUAL COLLECTION COSTS (INCLUDING
REASONABLE ATTORNEYS' FEES), WITH OR WITHOUT DECLARATION, AND
- 3 -
WITHOUT STAY OF EXECUTION, AND WITH RELEASE OF ERRORS AND TIlE RIGHT
TO ISSUE EXECUTION FORTHWITH, AND FOR DOING SO THIS AGREEMENT OR A
COpy VERIFIED BY AFFIDAVIT SHALL BE A SUFFICIENT WARRANT. THE
GUARANTORS HEREBY WAIVE AND RELEASE ALL RELIEF FROM ANY AND ALL
APPRAISEMENT, STAY OR EXEMPTION LAWS OF ANY STATE NOW IN FORCE OR
HEREAFTER ENACTED. THIS AUTHORITY AND POWER SHALL NOT BE
EXHAUSTED BY THE EXERCISE THEREOF AND SHALL CONTINUE UNTIL THE
OBLIGATIONS ARE FULL Y PAID, PERFORMED, DISCHARGED AND SATISFIED.
BEING FULLY AWARE OF THEIR RIGHTS TO PRIOR NOTICE
AND HEARING ON THE VALIDITY OF ANY CLAIMS THAT MAY BE ASSERTED
AGAINST THEM BY THE PAYEE UNDER THIS AGREEMENT BEFORE JUDGMENT
CAN BE ENTERED, THE GUARANTORS HEREBY KNOWINGLY, VOLUNTARlL Y AND
INTENTIONALLY WAIVE THESE RIGHTS AND EXPRESSLY AGREE AND CONSENT
TO THE PAYEE, UPON THE OCCURRENCE OF AN EVENT OF DEFAULT, OR AT ANY
TIME THEREAFTER, ENTERING JUDGMENT AGAINST THE GUARANTORS BY
CONFESSION, WITHOUT PRIOR NOTICE OR OPPORTUNITY FOR A HEARING. THE
GUARANTORS ACKNOWLEDGE THAT THEY HAVE HAD THE ASSISTANCE OF
COUNSEL IN THE REVIEW AND EXECUTION OF THIS AGREEMENT AND FURTHER
ACKNOWLEDGE THAT THE MEANING AND EFFECT OF THE FOREGOING
PROVISIONS CONCERNING CONFESSION OF JUDGMENT HA VB BEEN FULL Y
EXPLAINED TO THE GUARANTORS BY SUCH COUNSEL.
IN WITNESS WHEREOF, the Guarantors have executed this Guaranty as an
instrument under seal, as of the date first above written.
GUARANTORS
~
(Seal)
Patrick Crowe
4'~(SeaI)
Elizabeth Crowe
-4-
.
.
G
.
EXHIBIT G
SCHEDULE SHOWING
ACTUAL AMORTIZATION OF PRINCIPAL AND INTEREST
UNDER EQUIPMENT LEASE
DATE PAYMENT INTEREST PRINCIPAL BALANCE
5,200,000.00
09/01/2005 96,984.30 26,213.70 70,770.60 5,129,229.40
1 % 1/2005 105,437.25 34,194.86 71,242.39 5,057,987.01
11/01/2005 105,437.25 33,719.91 71,717.34 4,986,269.67
12/01/2005 105,437.25 33,241.80 72,195.45 4,914,074.22
02/08/2006 32,000.00 73,379.65 (41,379.65) 4,955,453.87
02/13/2006 33,597.92 5,430.63 28,167.29 4,927,286.58
02/21/2006 33,827.51 8,639.63 25,187.88 4,902,098.70
02/28/2006 6,011.82 7,521.03 (1,509.21) 4,903,607.91
03/16/2006 40,000.00 17,196.21 22,803.79 4,880,804.12
03/17/2006 25,000.00 1,069.77 23,930.23 4,856,873.89
03/21/2006 40,437.25 4,258.08 36,179.17 4,820,694.72
04/12/2006 100,000.00 23,244.99 76,755.01 4,743,939.71
04/20/2006 5,437.25 8,318.14 (2,880.89) 4,746,820.60
05/02/2006 105,437.25 12,484.79 92,952.46 4,653,868.14
06/01/2006 50,000.00 30,600.78 19,399.22 4,634,468.92
06/06/2006 40,000.00 5,078.87 34,921.13 4,599.547.79
06/15/2006 15,437.25 9,073.08 6,364.17 4,593,183.62
06/29/2006 25,000.00 14,094.15 10,905.85 4,582,277.77
07/05/2006 50,000.00 6,026.01 43,973.99 4,538,303.78
07/06/2006 25,000.00 994.70 24,005.30 4,514,298.48
08/16/2006 40,000.00 40,055.64 (55.64) 4,514,354.12
08/23/2006 20,000.00 6,926.13 13,073.87 4,501,280.25
08/30/2006 20,000.00 6,906.07 13,093.93 4,488,186.32
09/12/2006 15,437.25 12,788.26 2,648.99 4,485,537.33
09/25/2006 15,437.25 12,780.71 2,656.54 4,482,880.79
10/10/2006 40,000.00 14,738.24 25,261.76 4,457,619.03
10/25/2006 30,000.00 14,655.19 15,344.81 4,442,274.22
10/27/2006 35,437.25 1,947.30 33,489.95 4,408,784.27
11/13/2006 9,767.64 16,427.25 (6,659.6f) 4,415,443.88
11/20/2006 40,000.00 6,774.38 33,225.62 4,382,218.26
11/28/2006 40,000.00 7,683.89 32,316.11 4,349,902.15
12/04/2006 14,728.14 5,720.42 9,007.72 4,340,894.43
12/11/2006 15,000.00 6,660.00 8,340.00 4,332,554.43
12/18/2006 18,750.00 6,647.21 12,102.79 4,430,451.64
12/26/2006 18,750.00 7,575.59 11,174.41 4,309,277.23
645876.\
DATE PAYMENT INTEREST PRINCIPAL BALANCE
01/03/2007 5,978.14 7,555.99 (1,577.85) 4,310,855.08
01/16/2007 7,500.00 12,282.98 (4,782.98) 4,315,638.06
01/18/2007 7,500.00 1,891.79 5,608.21 4,310,029.85
01/22/2007 7,500.00 3,778.86 3,721.34 4,306,308.51
03/01/2007 16,478.14 38,210.13 (21,731.99) 4,328,040.50
03/05/2007 103,478.14 3,794.45 99,683.69 4,228,356.81
03/08/2007 81,750.00 2,780.29 78,969.71 4,149,387.10
03/23/2007 73,875.00 13,641.82 60,233.18 4,089,153.92
04/02/2007 8,962.52 4,098,116.44
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EXHIBIT H
EQUIPMENT LEASE
NORMAL AMORTIZATION SCHEDULE
DATE PAYMENT INTEREST PRINCIPAL BALANCE
08/09/2005 5,200,000.00
09/01/2005 96,984.30 26,213.70 70,770.60 5,129,299.40
10/01/2005 105,437.25 34,194.86 71,242.39 5,057,987.01
11/01/2005 105,437.25 33,719.91 71,717.34 4,986,269.67
12/01/2005 105,437.25 33,241.80 72,195.45 4,914,074.22
01/01/2006 105,437.25 32,760.49 72,676.76 4,841,397.46
02/0112006 105,437.25 32,275.98 73,161.27 4,768,236.19
03/01/2006 105,437.25 31,788.24 73,649.01 4,694,587.18
04/01/2006 105,437.25 31,297.25 74,140.00 4,620,447.18
05/01/2006 105,437.25 30,802.98 74,634.27 4,545,812.91
06/01/2006 105,437.25 30,305.42 75,131.83 4,4 70,681.08
07/01/2006 105,437.25 29,804.54 75,632.71 4,395,048.37
08/01/2006 105,437.25 29,300.32 76,136.93 4,318,911.44
09/01/2006 105,437.25 28,792.74 76,644.51 4,242,266.93
10/01/2006 105,437.25 28,281.78 77,155.47 '4,165,111.46
11/01/2006 105,437.25 27,767.41 77,669.84 4,087,441.62
12/01/2006 105,437.25 27,249.61 78,187.64 4,009,253.98
01/01/2007 105,437.25 26,728.36 78,708.89 3,930,545.09
02/01/2007 105,437.25 26,203.63 79,233.62 3,851,311.47
03/01/2007 105,437.25 25,675.41 79,761.84 3,771,549.63
04/01/2007 105,437.25 25,143.66 80,293.59 3,691,256.04
Outstanding Balance 4/01/07 per Normal Amortization Schedule $3,691,256.04
Less: Principal actually applied from sales of Equipment
3/01/07
3/05/07
3/08/07
3/23/07
$ 16,478.14
103,478.14
81,750.00
73.875.00
$ 275.581.28
$3,415,674.76
759.04
Plus: Interest @ 8% to 4/02/07
Outstanding Balance 4/02/07 per Normal Amortization
Schedule and Sales of Equipment
$3,416,433.80
645989.\
I
EXHIBIT I
SCHEDULE SHOWING
ACCRUED INTEREST ON TERM NOTE II
INTEREST INTEREST
DATE PRIME RATE BALANCE AMOUNT
4/20/2006 7.75% 10.00% 342,973.09 2,858.11
5/20/2006 8.00% 10.25% 345,831.20 2,929.56
6/20/2006 8.00% 10.50% 348,760.76 3,026,02
7/20/2006 8.25% 10.50% 351,786.78 3,051.66
8/20/2006 8.25% 10.75% 354,838.44 3,151.42
9/20/2006 8.25% 10.75% 357,989.86 3,178.76
10/20/2006 8.25% 10.75% 361,168.62 3,206.99
11/20/2006 8.25% 10.75% 364,375.61 3,235.47
12/20/2006 8.25% 10.75% 367,611.08 3,264.20
12/31/2006 8.25% 10.75% 370,875.28 1,207.50
Total due at 12/31/2006 372,082.78
646015.\
s
EXHIBIT J
SCHEDULE SHOWING
ACTUAL AMORTIZATION OF PRINCIPAL AND INTEREST
UNDER TERM NOTE II
DATE PAYMENT INTEREST PRINCIPAL BALANCE
372,082.78
01/03/2007 3,507.98 328.76 3,179.22 368,903.56
01/16/2007 2,500.00 1,412.45 1,087.55 367,816.01
01/18/2007 2,500.00 216.66 2,283.34 365,532.67
01/22/2007 2,500.00 430.63 2,069.37 363,463.30
03/01/2007 7,250.00 4,336.09 2,913.91 360,549.39
03/05/2007 36,250.00 424.76 35,825.24 324,724.15
03/08/2007 27,250.00 286.91 26,963.09 297,761.06
03/23/2007 24,625.00 1,315.45 23,309.55 274,451.51
04/02/2007 808.31 275,259.82
645930.1
EXHIBIT J
SCHEDULE SHOWING
ACTUAL AMORTIZATION OF PRINCIPAL AND INTEREST
UNDER TERM NOTE II
DATE PAYMENT INTEREST PRINCIPAL BALANCE
372,082.78
01/03/2007 3,507.98 328.76 3,179.22 368,903.56
01/16/2007 2,500.00 1,412.45 1,087.55 367,816.01
01/18/2007 2,500.00 216.66 2,283.34 365,532.67
01/22/2007 2,500.00 430.63 2,069.37 363,463.30
03/01/2007 7,250.00 4,336.09 2,913.91 360,549.39
03/05/2007 36,250.00 424.76 35,825.24 324,724.15
03/08/2007 27,250.00 286.91 26,963.09 297,761.06
03/23/2007 24,625.00 1,315.45 23,309.55 274,451.51
04/02/2007 808.31 275,259.82
645930.\
K
Vaughan Transport, Inc.
Late Fee Summary
Asset AR
Note Note Lease Balance
2006
1/1 Jan 5,271.86 5,271.86
1/10 Jan 956.87 6,228.73
2/1 Feb 5,271.86 11,500.59
2/10 Feb 956.87 12,457.46
2/28 Payment (1,578.87) (5,271.86) 5,606.73
3/1 Mar 5,271.86 10,878.59
3/10 Mar 956.87 11,835.46
4/1 Apr 5,271.86 17,107.32
4/30 Apr 2,592.71 19,700.03
5/30 May 2,575.66 22,275.69
6/1 Jun 2,771.86 25,047.55
6/30 Jun 2,556.99 27,604.54
7/1 Jul 4,021.86 31,626.40
7/20 Jul 956.87 32,583.27
7/30 Jul 2,535.55 35,118.82
8/1 Aug 5,271.86 40,390.68
8/20 Aug 956.87 41,347.55
8/30 Aug 2,515.65 43,863.20
9/1 Sep 5,271.86 49,135.06
9/20 Sep 956.87 50,091.93
9/30 Sep 2,493.70 52,585.63
10/1 Oct 5,271.86 57,857.49
10/10 Oct 956.87 58,814.36
1 0/30 Oct 2,471.76 61,286.12
11/1 Nov 5,271.86 66,557.98
11/3 Payment (5,119.22) (8,464.38) 52,974.38
11/6 Payment (5,000.00) 47,974.38
11/13 Payment (30,232.36) 17,742.02
12/1 Dee 5,271.86 23,013.88
12/4 Payment (5,271.86) 17,742.02
12/11 Payment (5,000.00) 12,742.02
12/18 Payment (6,250.00) 6,492.02
12/26 Payment (6,250.00) 242.02
Balance 12/31/2006 242.02
1/2 Jan 5,271.86
1/3 Payment (242.02) (5,271.86)
2/1 Feb 5,271.86
3/1 Payment (5,271.86)
3/1 Mar 5,271.86
3/5 Payment (5,271.86)
4/2 Apr 5,271.86
(0.00) 5,271.86
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Timothy J. Neiman, Esquire
Jennifer Zimmerman, Esquire
RHOADS & SINON LLP
One South Market Square
P.O. Box 1146
Harrisburg, P A 17108-1146
(717) 233-5731
Attorneys for Plaintiff
VAUGHAN TRANSPORT, INC.
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY,
PENNSYLVANIA
Plaintiff
v.
CNIL ACTION - LAW
VAUGHAN TRANSPORTATION
SERVICES, INC., PATRICK CROWE,
and ELIZABETH CROWE
NO. 67 -/P~?
e/~,'L 7~
Defendants
NOTICE UNDER RULE 2958.1 OF
JUDGMENT AND EXECUTION THERETO
Notice of Defendant's Ril!hts
To: Vaughan Transportation Services, Inc.
2560 S. Ocean Blvd.
Suite 710
Palm Beach, Florida 33480
Vaughan Transportation Services, Inc.
116 Cooley Industrial Way
LaGrange, Georgia 30241
Vaughan Transportation Services, Inc.
49 Avenue SW
Lanett, Alabama 36863
Patrick Crowe
2560 S. Ocean Blvd.
Suite 710
Palm Beach, Florida 33480
.
.
Elizabeth Crowe
2560 S. Ocean Blvd.
Suite 710
Palm Beach, Florida 33480
A judgment in the amount of $4,380,611.81 plus accruing interest from the date of
judgment in a per diem amount of $981.58, attorneys' fees and costs of collection, has been
entered against you and in favor of the Plaintiff without any prior notice or hearing based on a
Confession of Judgment contained in a written agreement or other paper allegedly signed by you.
The Sheriff may take your money or other property to pay the judgment at any time after thirty
(30) days after the date on which this notice is served on you,
You may have legal rights to defeat the judgment or to prevent your money or property
from being taken. YOU MUST FILE A PETITION SEEKING RELIEF FROM THE
JUDGMENT AND PRESENT IT TO A JUDGE WITHIN THIRTY (30) DAYS AFTER THE
DATE ON WHICH THIS NOTICE IS SERVED ON YOU OR YOU MAY LOSE YOUR
RIGHTS.
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO
NOT HAVE A LAWYER, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW.
THIS OFFICE CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A LAWYER.
IF YOU CANNOT AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE ABLE
TO PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY OFFER
LEGAL SERVICES TO ELIGmLE PERSONS AT A REDUCED FEE OR NO FEE.
.
"'"
LAWYER REFERRAL SERVICE
CUMBERLAND COUNTY BAR ASSOCIATION
32 SOUTH BEDFORD STREET
CARLISLE, P A 17013
(717) 249-3166
Respectfully submitted,
RHOADS & SINON LLP
Dated:--bn'l ~) UJD1
By:
Imoth Neiman, Esquire
Jennifer Zimmerman, Esquire
One South Market Square
P.O. Box 1146
Harrisburg, PA 17108-1146
(717) 233-5731
Attorneys for the Defendants, Vaughan
Transportation Services, Inc., Patrick Crowe,
and Elizabeth Crowe, for the purpose of
confessing judgment; Attorneys for the
Plaintiff, Vaughan Transport, Inc., for all
other purposes
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Timothy J. Neiman, Esquire
Attorney J.D. No. 66024
Jennifer Zimmerman, Esquire
Attorney J.D. No. 89459
RHOADS & SINON LLP
One South Market Square
P.O. Box 1146
Harrisburg, P A 17108-1146
(717) 233-5731
Attorneys for Plaintiff
VAUGHAN TRANSPORT, INe.
Plaintiff
v.
VAUGHAN TRANSPORTATION
SERVICES, INC., PATRICK CROWE,
and ELIZABETH CROWE
Defendants
IN THE COURT OF COMMON PLEAS
OF CUMBERLAND COUNTY,
PENNSYLVANIA
CNIL ACTION - LAW
NO. c)'7 - 1<f77
e/~(17a'l
RULE 236 NOTICE OF ENTRY OF CONFESSED JUDGMENT
To: Vaughan Transportation Services, Inc.
2560 S. Ocean Blvd.
Suite 710
Palm Beach, Florida 33480
Vaughan Transportation Services, Inc.
116 Cooley Industrial Way,
LaGrange, Georgia 30241
Vaughan Transportation Services, Inc.
49 Avenue, SW
Lanett, Alabama 36863
Patrick Crowe
2560 S. Ocean Blvd.
Suite 710
Palm Beach, Florida 33480
y
Elizabeth Crowe
2560 S. Ocean Blvd.
Suite 710
Palm Beach, Florida 33480
You are hereby notified that on April 4, 2007, judgment by confession was entered
against you in the amount $4,380,611.81, plus interest accruing at a per diem rate of $981.58,
and costs of collection, including, without limitation, reasonable attorneys' fees.
Attached hereto are copies of all documents filed with the Prothonotary in support of the
confession of judgment.
Date: 1.41fol
p~~~
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT
HA VB A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE OFFICE
SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP.
LAWYER REFERRAL SERVICE
CUMBERLAND COUNTY BAR ASSOCIATION
32 SOUTH BEDFORD STREET
CARLISLE, PA 17013
(717) 249-3166