Registration of Securities Issued in a Business-Combination Transaction — Form S-4
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-4 Nmhg Holding Co. and Subsidiaries Form S-4 195 965K
2: EX-3.1.I Articles of Incorporation/Organization or By-Laws 5 20K
3: EX-3.1.II Articles of Incorporation/Organization or By-Laws 20 39K
4: EX-4.1 Instrument Defining the Rights of Security Holders 1 11K
5: EX-4.2 Ex-4.1 134 379K
6: EX-4.3 Instrument Defining the Rights of Security Holders 25 100K
7: EX-10.1 Material Contract 198 761K
16: EX-10.10 Material Contract 1 13K
17: EX-10.11 Material Contract 3 25K
18: EX-10.12 Material Contract 83 284K
19: EX-10.13 Material Contract 14 60K
20: EX-10.14 Material Contract 98 255K
8: EX-10.2 Material Contract 11 39K
9: EX-10.3 Material Contract 26 104K
10: EX-10.4 Material Contract 8 37K
11: EX-10.5 Material Contract 28 96K
12: EX-10.6 Material Contract 2 17K
13: EX-10.7 Material Contract 21 89K
14: EX-10.8 Material Contract 2 16K
15: EX-10.9 Material Contract 2 15K
21: EX-12.1 Statement re: Computation of Ratios 1 14K
22: EX-16.1 Letter re: Change in Certifying Accountant 1 11K
23: EX-21.1 Subsidiaries of the Registrant 2± 12K
24: EX-23.1 Consent of Experts or Counsel 1 11K
25: EX-24.1 Power of Attorney 9 43K
26: EX-25.1 Statement re: Eligibility of Trustee 6 30K
27: EX-99.1 Miscellaneous Exhibit 15 70K
28: EX-99.2 Miscellaneous Exhibit 4 21K
29: EX-99.3 Miscellaneous Exhibit 2 17K
30: EX-99.4 Miscellaneous Exhibit 2 14K
Exhibit 10.5
RESTATED AND AMENDED JOINT VENTURE AND
SHAREHOLDERS AGREEMENT
BETWEEN
GENERAL ELECTRIC CAPITAL CORPORATION
AND
NACCO MATERIALS HANDLING GROUP, INC.
April 15, 1998
[Download Table]
GECC/NMHG RESTATED AND AMENDED
JOINT VENTURE AND SHAREHOLDERS AGREEMENT
TABLE OF CONTENTS
PAGE
SECTION 1 Formation and Purposes . . . . . . . . . . . . . . . 2
SECTION 2 Initial Capitalization of the Corporation . . . . . . 3
SECTION 3 Additional Capital Contributions . . . . . . . . . . 3
SECTION 4 Fiscal Year . . . . . . . . . . . . . . . . . . . . . 4
SECTION 5 Management of the Corporation . . . . . . . . . . . . 4
SECTION 6 Service and Financing Agreements . . . . . . . . . . 8
SECTION 7 NMHG Obligations . . . . . . . . . . . . . . . . . . 8
SECTION 8 GECC Obligations . . . . . . . . . . . . . . . . . . 9
SECTION 9 Profitability Criteria . . . . . . . . . . . . . . . 9
SECTION 10 Accounting Records . . . . . . . . . . . . . . . . . 10
SECTION 11 Representations and Warranties. . . . . . . . . . . . 10
SECTION 12 Indemnities . . . . . . . . . . . . . . . . . . . . . 11
SECTION 13 Litigation. . . . . . . . . . . . . . . . . . . . . . 12
SECTION 14 Term and Termination . . . . . . . . . . . . . . . . 13
SECTION 15 Dissolution of Venture . . . . . . . . . . . . . . . 15
SECTION 16 NMHG's Stock Option . . . . . . . . . . . . . . . . . 15
SECTION 17 Staffing and Organization Expenses. . . . . . . . 18
SECTION 18 Trademarks . . . . . . . . . . . . . . . . . . . . . 19
SECTION 19 Exclusivity . . . . . . . . . . . . . 19
SECTION 20 Confidentiality . . . . . . . . . . . . . . . . . . . 20
SECTION 21 Waiver . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 22 Notices . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 23 Entire Agreement; Amendments . . . . . . . . . . . . 21
SECTION 24 Adoption by Corporation; Legend on Certificates . . . 21
SECTION 25 Counterparts . . . . . . . . . . . . . . . . . . . . 22
SECTION 26 Successors and Assigns . . . . . . . . . . . . . . . 22
SECTION 27 Section Headings . . . . . . . . . . . . . . . . . . 22
SECTION 28 Governing Law and Arbitration . . . . . . . . . . 22
SECTION 29 Severability of Provisions . . . . . . . . . . . . . 22
SECTION 30 Advertising . . . . . . . . . . . . . . . . . . . . . 23
SECTION 31 Target Approval Rates 23
SECTION 32 Timetable 23
SECTION 33 Participation Fee 24
SECTION 34 Competitiveness 25
SECTION 35 Condition Precedent 25
EXHIBIT A - Corporate Name Agreement
EXHIBIT B - Certificate of Incorporation
EXHIBIT C - Amended and Restated By-Laws
EXHIBIT D - Financing Agreement
EXHIBIT E - Administrative Services Agreement
EXHIBIT F - Tax Allocation Agreement
EXHIBIT G - Remarketing Services Agreement
EXHIBIT H - Listing of NMHG Competitors
EXHIBIT I - Participation Fee Calculation
EXHIBIT J - Recourse and Indemnity Agreement
RESTATED AND AMENDED JOINT VENTURE
AND SHAREHOLDERS AGREEMENT
THIS AGREEMENT, dated April 15, 1998 ("Agreement") by and between
NACCO MATERIALS HANDLING GROUP, INC., a Delaware corporation with offices at 650
NE Holladay Street, Suite 1600, Portland, Oregon 97232 ("NMHG"), and GENERAL
ELECTRIC CAPITAL CORPORATION, a New York corporation with offices at 44 Old
Ridgebury Road, Danbury, Connecticut 06810 ("GECC").
BACKGROUND
----------
NMHG is in the business of manufacturing forklift trucks and other
equipment, including without limitation, both Yale and Hyster brand name
equipment (collectively, the "NMHG Equipment") which is sold and distributed by
NMHG and by its dealers ("Dealers").
GECC is in the business of, among other things, providing financing
on equipment similar to the NMHG Equipment.
On October 27, 1989, Yale Materials Handling Corporation ("Yale"),
acquired, pursuant to a Stock Purchase Agreement dated as of such date ("Stock
Purchase Agreement"), twenty percent (20%) of the issued and outstanding shares
of the capital stock of the Yale Financial Services, Inc. ("Corporation") from
GECC. As a result thereof, the Corporation was then owned twenty percent (20%)
by Yale and eighty percent (80%) by GECC.
In conjunction with the above-described stock purchase, Yale and GECC
entered into the Joint Venture and Shareholders Agreement ("Original
Shareholders Agreement") as of November 8, 1989 which Agreement (and the related
agreements executed concurrently therewith; the Original Shareholders Agreement
and the related Agreements shall collectively be referred to as the "JV
Agreements") related to the internal governance and day-to-day management and
operations of the Corporation.
As a result of a corporate reorganization effective as of January 1,
1994, NMHG and Yale entered into a Stock Purchase Agreement pursuant to which
Yale sold all of its interest in the Corporation to NMHG and assigned to NMHG
all of Yale's duties, obligations and benefits under all of the JV Agreements.
NMHG and GECC have now determined to revise the nature of their
relationship to areas outside of the United States (which global relationship
shall be governed by the terms of an Operating Agreement ("International
Operating Agreement") executed between NMHG, GECC and various international
affiliates and subsidiaries of GECC and NMHG) and additionally expand the
business scope of the Corporation to provide certain types of financing to the
Dealers and to the customers of NMHG and/or the Dealers ("Customers") for all
types and brands of NMHG Equipment. In conjunction therewith,
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NMHG and GECC have determined to amend and restate the Original Agreement and
certain of the other JV Agreements.
It is intended that in conjunction with the revision of the JV
Agreements, the name of the Corporation shall be changed to NMHG Financial
Services, Inc. It is further intended that the Corporation shall operate as two
divisions operating under the trade names "Yale Financial Services" ("Yale") and
"Hyster Credit" ("Hyster") and the services provided by the Corporation as set
forth herein shall be shared by both such divisions.
NOW, THEREFORE, in consideration of the above premises and mutual
covenants contained hereinbelow, the parties hereto hereby agree as follows:
1. FORMATION AND PURPOSES.
(a) On even date herewith, GECC and NMHG each hereby agree to amend
and restate this Agreement with NMHG continuing to own twenty percent (20%) and
GECC eighty percent (80%) of the outstanding shares of capital stock of the
Corporation. On or after the date that this Agreement commences: (i) the
Corporate Name Agreement shall be amended in the form of EXHIBIT A ATTACHED
HERETO; (ii) the Certificate of Incorporation of the Corporation shall be
amended in the form of EXHIBIT B attached hereto; and (iii) the By-Laws of the
Corporation shall be amended and restated in the form of EXHIBIT C attached
hereto. NMHG and GECC agree to take all necessary action and will vote their
respective shares to so amend and restate the Certificate of Incorporation and
the By-Laws.
(b) NMHG and GECC hereby agree that the primary purpose of the
Corporation shall be to provide the following types of financial services:
(i) origination and/or acquisition of floor plan and fleet
rental financing to the Dealers with respect to their
inventory of NMHG Equipment and any related trade-ins
("NMHG Inventory Financing");
(ii) origination and/or acquisition of floor plan and fleet
rental financing to the Dealers with respect to their
inventory of new and/or used equipment other than NMHG
Equipment ("Allied Inventory Financing");
(iii)origination and/or acquisition of parts inventory
financing to the Dealers ("Parts Inventory Financing"; the
NMHG Inventory Financing, Allied Inventory Financing and
Parts Inventory Financing being collectively referred to
as "Inventory Financing");
(iv) origination and/or acquisition of accounts receivable
financing to the Dealers ("Accounts Receivable Financing";
the Inventory Financing and Accounts Receivable Financing
being collectively referred to as "Wholesale Financing");
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(v) origination and/or acquisition of financing with respect
to any vehicles, computers and/or other types of
commercial equipment (other than inventory) for the
Dealers ("Commercial Equipment Financing");
(vi) origination and/or acquisition of true leases to the
Customers with respect to NMHG Equipment and/or Allied
Equipment ("Lease Financing"); and
(vii) origination and/or acquisition of secured loans,
conditional sales contracts, financing leases,
lease-purchase agreements or other financings (other
than Lease Financings) to the Customers with respect to
NMHG Equipment and/or Allied Equipment
("Money-Over-Money Financing"; Commercial Equipment
Financing, Lease Financing and Money-Over-Money
Financing being collectively referred to as "Retail
Financing"); and
(viii) any other financing programs mutually agreed to by GECC
and NMHG.
(c) Anything in Section 1(b) above to the contrary notwithstanding
and subject to the provisions of Section 5(g) below, it is agreed and understood
that the Corporation shall have the power and authority to engage in any lawful
act or activity for which corporations may be organized under the General
Corporation Law of the State of Delaware.
2. INITIAL CAPITALIZATION OF THE CORPORATION.
(a) The Corporation has authorized capital stock consisting of One
Thousand (1,000) shares of common stock, One Dollar ($1.00) par value (the
"Shares").
(b) On the date of this Agreement, there are One Thousand (1,000)
Shares issued and outstanding, of which two hundred (200) Shares are owned by
NMHG and Eight Hundred (800) Shares are owned by GECC.
(c) NMHG agrees to purchase twenty percent (20%) and GECC agrees to
purchase eighty percent (80%) of the number of Shares issued by the Corporation
at any time.
3. ADDITIONAL CAPITAL CONTRIBUTIONS.
(a) After giving effect to the initial capitalization of the
Corporation as described in Section 2(b) above, and subject to the debt/equity
limitations set forth in Section 3(b) below, when, as and if needed (whether on
the basis of actual or reasonably forecasted investments to be made) by the
Corporation, NMHG and GECC agree to make additional capital contributions to the
Corporation, which when added to all previous capital contributions, will not,
without the consent of NMHG, exceed an aggregate capitalization of One Hundred
Million Dollars ($100,000,000.00). Each such contribution to capital
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shall be made twenty percent (20%) by NMHG and eighty percent (80%) by GECC, but
neither NMHG nor GECC shall be required to pay its proportion of any such
contribution if the other does not pay its proportion thereof. Such additional
capital contributions shall be payable in full to the Corporation upon receipt
of written notice from GECC requesting such capital contributions. Subject to
the provisions of the second sentence of this Section 3(a), it is agreed that
GECC shall advance to the Corporation on behalf of NMHG any such additional
capital contribution that may be required from NMHG, and NMHG shall pay to GECC
on the first day of January, April, July and October the aggregate unpaid amount
of any such advances together with interest thereon from the date of such
advance by GECC to the Corporation until paid in full at a floating rate equal
to the lesser of (i) the Operating Fund Rate (as defined in the Financing
Agreement) or (ii) the highest rate not prohibited by applicable law. No
additional Shares of the Corporation may be issued in return for any additional
capital contributions; PROVIDED, HOWEVER, that if any additional Shares are
being issued, then such Shares shall be issued to both NMHG and GECC in
proportion to such additional capital contributions.
(b) It will be the financial policy of the Corporation to maintain a
Debt/Equity Ratio of approximately 15:1 or such higher ratio as may be agreed to
by GECC and NMHG from time to time. As used in this Agreement, the term
"Debt/Equity Ratio" shall mean a ratio calculated as follows:
The numerator shall equal the principal amount of the Debt of the
Corporation, plus interest accrued thereon; and the denominator shall
equal the shareholders equity shown on the Corporation's most recent
audited financial statements (adjusted to reflect increases or
decreases in shareholders' equity that may have occurred since the
date of such most recent audited financial statements).
As used in this Agreement, the term "Debt" shall mean all obligations for
borrowed money of the Corporation and shall include, but not be limited to any
borrowings by the Corporation from GECC.
4. FISCAL YEAR.
The fiscal year of the Corporation shall end on the last day of
December.
5. MANAGEMENT OF THE CORPORATION.
(a) BOARD OF DIRECTORS. GECC and NMHG agree that the By-Laws of the
Corporation shall at all times provide for a Board of Directors consisting of
seven (7) persons, each of whom shall be an employee of either GECC or NMHG, or
an employee of an affiliate of either GECC or NMHG. NMHG and GECC each agrees to
vote all of the Shares of the Corporation owned or held of record by it at any
time so as to elect, and thereafter for the term of this Agreement to continue
in office, a Board of Directors consisting of four (4) persons designated by
GECC (the "GECC Directors"), including the chairperson, and three (3) persons
designated by NMHG (the "NMHG DIRECTORS"). The Board will determine appropriate
levels of synergy and differentiation between the
Page 4
programs offered by the two brand marketing subsidiaries. The Board of Directors
will meet not less often than annually, and in any event ,within two weeks of
any submission to the Board of Directors for resolution as contemplated by this
Agreement.
(b) EXECUTIVE COMMITTEE. NMHG and GECC agree that the By-Laws of the
Corporation shall at all times provide for an Executive Committee consisting of
five (5) persons, three (3) of whom shall be GECC Directors (or GECC employees
appointed by the GECC Directors to serve in their stead) and the other two shall
be NMHG Directors (or NMHG employees appointed by the NMHG Directors to serve in
their stead). The Executive Committee shall have such powers (including, without
limitation, powers with respect to those matters specified in Section 5(g)
below) as shall be granted to it by the Board of Directors. A quorum for all
meetings of the Executive Committee shall require attendance of both members
thereof designated by NMHG, and all actions to be taken by the Executive
Committee must be (i) approved by the unanimous consent of the members and (ii)
recorded in writing to be made available to the Board of Directors. The
Executive Committee will meet not less often than biannually, and in any event
within one week of any submission to the Executive Committee for resolution as
contemplated by this Agreement.
(c) OFFICERS. NMHG and GECC agree that the By-Laws of the Corporation
shall at all times provide for the following officers: a President, an Executive
Vice President, Vice Presidents, a Treasurer, a Secretary and Assistant
Secretaries. Subject to confirmation by the Board of Directors, four Vice
Presidents (other than the Executive Vice President) will be designated by the
NMHG Director ("NMHG OFFICERS"), and all other officers will be designated by
the GECC Directors ("GECC OFFICERS"). NMHG and GECC will each instruct the
Director(s) designated by it to confirm the Officers designated by the other
parties.
(d) STEERING COMMITTEES. The By-Laws of the Corporation shall provide
for separate Steering Committees, one each for Yale and Hyster, consisting of
four persons each, two of whom shall be NMHG Officers, as applicable, and two of
whom shall be GECC Officers. Subject to confirmation by the Board of Directors,
the NMHG Officers on the Steering Committees shall be designated by NMHG, and
the GECC Officers on the Steering Committees shall be designated by GECC. The
Steering Committees shall have the following duties:
(A) providing input for development of new products;
(B) setting response times;
(C) setting target credit approval rates;
(D) monitoring credit approval target achievement and systems;
(E) providing input for development of automated systems;
Page 5
(F) staffing and personnel matters; and
(G) reviewing competitiveness and adequacy of financing
program rates.
NMHG and GECC will each agree that it will instruct the Director(s) designated
by it to confirm the Steering Committees Members designated by the other. Either
Steering Committee, by the vote of any two of its members, may refer any matter
to the Executive Committee for review and resolution, which matter will be
considered and resolved by the Executive Committee within two weeks of such
referral.
(e) STATUS OF DIRECTORS AND OFFICERS. All directors and officers of
the Corporation will be employees of either NMHG or GECC, or employees of an
affiliate of NMHG or GECC, and said directors and officers shall remain
participants in any retirement or pension plan, insurance, medical or other
employee benefit plans of NMHG or GECC, or any such affiliate, as the case may
be; it being understood and agreed that the Corporation will not have any
employees and shall not be required to adopt, or maintain in force, any such
employee benefit plans.
(f) COMPENSATION OF DIRECTORS AND OFFICERS. No director or officer of
the Corporation shall be entitled to any compensation from the Corporation in
consideration of any services that may be from time to time rendered to the
Corporation.
(g) SUPER-MAJORITY PROVISIONS IN BY-LAWS. NMHG and GECC agree that
the By-Laws of the Corporation shall at all times provide that any action to be
taken by the Corporation on any of the matters listed in this Section 5(g) below
must be approved by either the affirmative vote of the entire Board of Directors
or the unanimous consent of NMHG and GECC:
(i) entry into any business other than providing the financial
services to the Dealers and the Customers as described in
Section 1(b) above;
(ii) approving each annual budget, each annual operational plan
and major variances to each such plan, approving annual
financial statements, and any declaration of dividends
other than those which are not in excess of current year's
earning or those under Section 15(b) hereinbelow;
(iii) guaranteeing the indebtedness or other obligation of any
person or entity;
(iv) borrowing any funds (except from GECC);
(v) pledging, mortgaging or otherwise encumbering any assets
(tangible or intangible) as security for loans or
otherwise;
(vi) acquiring or disposing of any assets, or otherwise entering
into any commitment, contract or transaction, other than in
the normal course of business;
Page 6
(vii) merging or consolidating with or into any other entity;
(viii) liquidating or dissolving other than in accordance with the
terms and conditions of this Agreement;
(ix) except as otherwise provided in Section 3 above, issuing
any new shares or increasing the authorized capital stock
of the Corporation, or repurchasing any of the capital
stock of the Corporation, or entering into any agreement
for the sale, purchase or transfer of any of the shares of
the Corporation; or
(x) amending or otherwise modifying the Certificate of
Incorporation or By-Laws of the Corporation;
(xi) the grant of any power to the Executive Committee or the
Steering Committees; or
(xii) establishing any committee of the Board of Directors, other
than the Executive Committee and Steering Committees, or
creating or altering the powers and/or responsibilities of
any committee of the Board of Directors.
(xiii) approving any accounting records and reports maintained and
prepared in accordance with Section 10 hereof.
(h) REMOVAL OF DIRECTORS OR OFFICERS. If at any time NMHG or GECC
shall notify the other party that the notifying party desires any director of
the Corporation designated by it to be removed as a director, the other party
agrees that it will take all action necessary in order to cause the removal of
such director. If at any time either NMHG or GECC shall notify the other party
that the notifying party desires that any officer of the Corporation designated
by it be removed as an officer of the Corporation, the other party agrees that
it will take all action necessary in order to cause the removal of such officer.
(i) VACANCIES. Whenever any vacancy on the Board of Directors is to
be filled, the party who designated the individual formerly occupying such
directorship shall be entitled to designate a successor to fill such vacancy and
the other party hereto agrees to take such action as is necessary to cause such
individual to be elected as a member of the Board of Directors. Whenever any
vacancy occurs with respect to any officer of the Corporation, the party who
designated the individual formerly occupying such position shall be entitled to
designate a successor to fill such vacancy, subject to confirmation by the Board
of Directors, and the other party hereto agrees to take such action as is
necessary to cause such individual to be elected as an officer, and to instruct
the Director(s) designated by it to confirm the designation of the successor to
such position.
6. SERVICE AND FINANCING AGREEMENTS.
Page 7
On or after the date upon which this Agreement commences, NMHG and
GECC agree to cause the Corporation to enter into the following restated and
amended agreements ("Other Agreements"):
(i) a Financing Agreement with GECC in the form of EXHIBIT D
hereto ("Financing Agreement");
(ii) an Administrative Services Agreement with GECC in the form
of EXHIBIT E hereto ("Administrative Services Agreement");
(iii) a Tax Allocation Agreement with GECC in the form of EXHIBIT
F hereto ("Tax Allocation Agreement"; the Financing
Agreement, Administrative Services Agreement and Tax
Allocation Agreement being collectively referred to as the
"Other GECC Agreements");
(iv) a Remarketing Services Agreement with NMHG in the form of
EXHIBIT G hereto ("Remarketing Agreement"); and
(v) a Recourse and Indemnity Agreement with NMHG in the form of
EXHIBIT J hereto ("Recourse Agreement"; the Remarketing
Agreement and the Recourse Agreement being collectively
referred to as the "Other NMHG Agreements").
To the extent that any term or provision of this Agreement is in conflict with
any term or provision of the Other GECC Agreements or Other NMHG Agreements, the
terms and provisions of such Other Agreements shall prevail.
7. NMHG OBLIGATIONS.
(a) Subject to the provisions of Section 30 hereinbelow, NMHG shall
have primary responsibility for communicating with the Dealers and the Customers
with respect to marketing the financial services of the Corporation (including,
without limitation, training Dealer sales personnel on the use of financing as a
major sales tool, providing the Dealer from time to time with finance rates and
factors approved by the Corporation, assisting the Dealers in closing major
financing transactions, establishing and administering Dealer credit lines with
respect to Wholesale Financing, scheduling Dealer floor plan audits, collections
follow-up with Dealers in default under Wholesale Financing arrangements and
generally promoting the Wholesale Financing and Retail Financing offered by the
Corporation as an alternative source of financing to the Dealers and the
Customers). All costs and expenses related to the provision of such services by
NMHG shall be reimbursed to NMHG by the Corporation pursuant to the terms of
Section 17(a) below. Anything in the first sentence of this Section 7(a)
notwithstanding, NMHG shall not make any commitment of any kind whatsoever
(written, verbal, implied or otherwise) on behalf of GECC, and NMHG shall not
make any commitment of any kind whatsoever (written, verbal, implied, or
otherwise) on behalf of the Corporation unless such commitment is specifically
authorized by the Board of Directors of the Corporation
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or is within the scope of authority delegated to either of the Steering
Committees of the Corporation and such commitment is approved specifically or
generically by any such Steering Committee. NMHG hereby agrees to indemnify,
defend and hold harmless GECC, the Corporation and their respective successors
and assigns, from and against any and all claims, suits, actions, judgments,
losses, costs and expenses (including, without limitation, reasonable attorneys'
fees) arising out of or in connection with, directly or indirectly, any breach
by NMHG of its obligations under the immediately preceding sentence.
(b) NMHG agrees to provide information to the extent that GECC
requires such information to perform its obligations hereunder or under any of
the Other Agreements, at all times during the term hereof.
8. GECC OBLIGATIONS.
(a) GECC agrees to support, assist and cooperate with NMHG in
marketing the financial services of the Corporation to the Dealers and the
Customers. All costs and expenses related to the provision of such services by
GECC shall be reimbursed to GECC by the Corporation pursuant to the terms of
Section 17(a) below.
(b) GECC agrees to provide information to the extent that NMHG
requires such information to perform its obligations hereunder or under any of
the Other Agreements.
(c) Anything in this Section 8 notwithstanding, GECC shall not make
any commitment of any kind whatsoever (written, verbal, implied or otherwise) on
behalf of NMHG unless such commitment is specifically authorized in writing by
NMHG. GECC hereby agrees to indemnify, defend and hold harmless NMHG and its
respective successors and assigns, from and against any and all claims, suits,
actions, judgments, losses, costs and expenses (including, without limitation,
reasonable attorneys' fees) arising out of or in connection with, directly or
indirectly, any breach by GECC of its obligations under the immediately
preceding sentence.
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9. PROFITABILITY CRITERIA.
(a) The goal of the Corporation is to earn an after tax return on its
equity ("ROE") of at least fourteen percent (14%) per annum for each full
calendar year throughout the term of this Agreement. For purposes of this
Agreement, ROE shall be computed as follows: annualized net income divided by
average shareholders' equity and determined in accordance with generally
accepted accounting principles. All performance criteria will be reviewed at
least every twelve (12) calendar months to ensure that NMHG and GECC are
satisfied.
10. ACCOUNTING RECORDS.
(a) It shall be the responsibility of GECC to maintain the books,
records and accounts of the Corporation pursuant to the same accounting
principles which GECC uses for its own accounts. Annual Reports for the
Corporation shall be provided to NMHG by GECC within one-hundred and twenty
(120) days after the close of each calendar year.
(b) NMHG shall have the right to examine and inspect, at any and all
times during normal business hours, the books, records and accounts of the
Corporation, and GECC shall make available to NMHG appropriate personnel to
answer any questions related thereto. Such books, records and accounts shall be
maintained by GECC at such location as GECC may from time to time choose;
provided however that the choice of such location shall be subject to the
consent of NMHG, which consent shall not be unreasonably withheld. GECC and NMHG
each acknowledges that such books, records and accounts shall be and remain the
property of the Corporation.
11. REPRESENTATIONS AND WARRANTIES.
(a) GECC hereby represents and warrants to NMHG as follows:
(i) GECC has been duly and validly organized, and is a
validly existing corporation, under the laws of the
State of New York with full power and authority to enter
into this Agreement and to perform its obligations
hereunder.
(ii) This Agreement has been duly authorized, executed and
delivered by GECC and constitutes GECC's valid and
binding agreement, enforceable against GECC in
accordance with its terms.
(iii) GECC is not a party to, or threatened with any suit,
action, arbitration, administrative or other proceeding
or governmental investigation which might materially and
adversely affect GECC, this Agreement, or any of the
transactions contemplated hereby, and there is no
judgment, decree, award or order outstanding against
GECC which might
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materially and adversely affect GECC, this Agreement, or
any of the transactions contemplated hereby.
(iv) The execution and delivery of this Agreement, the
consummation of the transactions provided for herein, and
the fulfillment of the terms of this Agreement by GECC (A)
will not result in the breach of any of the terms and
provisions of, or constitute a default (after notice, or
passage of time, or both) under, or conflict with, any
agreement or other instrument by which GECC is bound where
such breach, default or conflict would have a material
adverse effect on GECC's business or financial condition,
(B) will not violate any judgment, decree, order, or award
of any court, governmental body, or arbitrator, or any
applicable law, rule or regulation where such violation
would have a material adverse effect on GECC's business or
financial condition, and (C) do not require the consent of
any governmental authority.
(b) NMHG hereby represents and warrants to GECC as follows:
(i) NMHG has been duly and validly organized, and is a validly
existing corporation, under the laws of the State of
Delaware with full power and authority to enter into this
Agreement and perform its obligations hereunder.
(ii) This Agreement has been duly authorized, executed and
delivered by NMHG and constitutes NMHG's valid and binding
agreement enforceable against NMHG in accordance with its
terms.
(iii) NMHG is not a party to, or threatened with, any suit,
action, arbitration, administrative or other proceeding, or
governmental investigation which might materially and
adversely affect NMHG, this Agreement, or any of the
transactions contemplated hereby, and there is no judgment,
decree, award or order outstanding against NMHG which might
materially and adversely affect NMHG, this Agreement, or
any of the transactions contemplated hereby.
(iv) The execution and delivery of this Agreement, the
consummation of the transactions provided for herein, and
the fulfillment of the terms of this Agreement by NMHG (A)
will not result in the breach of any of the terms and
provisions of, or constitute a default (after notice or
passage of time, or both) under, or conflict with, any
agreement or other instrument by which NMHG is bound where
such breach, default or conflict would have a material
adverse effect on NMHG's business or financial condition,
(B) will not violate any judgment, decree, order, or award
of any court, governmental body, or arbitrator, or any
applicable law, rule or regulation where such violation
would have a material adverse effect
Page 11
on NMHG's business or financial condition, and (C) do not
require the consent of any governmental authority.
12. INDEMNITIES.
Each party agrees to indemnify, defend and hold the other harmless
from, against and in respect of any and all claims, demands, damages suffered,
or losses incurred, by the party to be indemnified as a result of the failure of
any representation or warranty of the indemnifying party, as set forth in
Section 11 hereof, to be true and correct.
13. LITIGATION.
(a) In the event that any litigation and/or claim arising out of the
operations conducted under this Agreement or the Other Agreements in which the
Corporation, GECC, their subsidiaries and affiliates, or the directors, officers
or employees of any of them, is or are involved or potentially will become
involved contains solely allegations of product defect or breach of warranty
with respect to any NMHG Equipment which is the object of financing provided by
the Corporation, NMHG, subject to Section 14(c) hereof, will have sole control
of the prosecution or defense of such claim, litigation or potential litigation.
NMHG shall prepare a report for the Corporation and GECC each month of such
litigation and/or claims. Such report shall include the style of the suit, the
nature of the claim, the damages sought and the status of each suit.
(b) In the event that any litigation and/or claim arising out of the
operations conducted under this Agreement or the Other Agreements in which the
Corporation, GECC, their subsidiaries and affiliates, or the directors, officers
or employees of any of them, is or are involved or potentially will become
involved contains solely allegations other than of product defect or breach of
warranty with respect to any NMHG Equipment, GECC, subject to Section 14(c)
hereof, will have sole control of the prosecution or defense of such claim,
litigation or potential litigation. GECC shall prepare a report for the
Corporation and NMHG each month of such litigation and/or claims. Such report
shall include the style of the suit, the nature of the claim, the damages sought
and the status of each suit.
(c) The provisions of Sections 14(a) and 14(b) to the contrary
notwithstanding, in the event that (i) any claim or litigation arising out of
operations conducted under this Agreement or the Other Agreements in which the
Corporation, GECC, their subsidiaries or affiliates, or the directors, officers
or employees of any of them, is or are involved or potentially will become
involved exceeds $100,000 (with respect to the amount of the claim or demand) or
(ii) any claim or litigation contains both (A) allegations of product defect or
breach of warranty with respect to any NMHG Equipment and (B) allegations other
than product defect or breach of warranty with respect to any
NMHG Equipment, both NMHG and GECC shall be entitled to participate in the
prosecution and defense of such claims; PROVIDED, HOWEVER, (i) NMHG shall have
control of the prosecution or defense of any claims involving product defect or
breach of warranty with respect to any
Page 12
NMHG Equipment and (ii) GECC shall have control of the prosecution or defense of
all other claims.
(d) In the event that any claim or litigation is subject to indemnity
by one party hereto of the other whether under this Agreement or any other
agreement, the indemnitor shall have sole control of the litigation thereof
(including the negotiation and consummation of any settlement of such claim or
of such litigation); PROVIDED, HOWEVER, that the indemnitor acknowledges in
writing to the indemnitee(s) its obligation to indemnify with respect to all
claims set forth in such litigation and advises in reasonable detail in writing
the terms and conditions of any such proposed settlement.
(e) In the event that NMHG and GECC are unable to agree to the
applicability of any indemnification provision under this Agreement or any other
agreement in connection with any such claim or litigation, then such matter
shall only be settled upon terms and conditions satisfactory to both NMHG and
GECC.
(f) The Corporation shall bear all outside legal costs and expenses
(including, without limitation, attorneys' fees) arising from the prosecution or
defense of any claim or litigation by or against the Corporation, its directors,
officers or employees, as well as any compromise or settlement thereof, unless
such claim or litigation is subject to indemnity by one party hereto whether
under this Agreement or any other agreement and, in that case, the indemnitor
shall bear all outside legal costs and expenses (including, without limitation,
attorneys' fees) arising therefrom or from any compromise or settlement thereof.
14. TERM AND TERMINATION.
(a) This Agreement shall be effective upon the execution and delivery
hereof, shall remain in full force and effect until December 31, 2002 (the "Base
Term") unless sooner terminated as hereinafter provided, and will automatically
renew for additional periods of one year (each a "Renewal Term") unless either
party at any time not less than 180 days prior to the end of the Base Term or
any Renewal Term notifies the other that the notifying party will not renew this
Agreement, in which event this Agreement will expire at the end of such Base
Term or Renewal Term. Anything herein to the contrary notwithstanding, either
party shall have the right to terminate this Agreement without cause during any
Renewal Term upon at least 180 days prior written notice to the other party.
(b) Notwithstanding anything to the contrary contained in Section
14(a) hereof, this Agreement may be terminated during the Base Term or any
Renewal Term for "cause" (x) upon five days prior written notice by either party
to the other in the case of events specified in clauses (i) and (ii) below, and
(y) upon 30 days prior written notice by either party to the other in the case
of events specified in clauses (iii), (iv), (v) and (vi) below and failure to
cure the default or event within such period. "Cause" shall be defined as
follows:
Page 13
(i) dissolution or liquidation of the other party or the
Corporation;
(ii) insolvency of the other party or the Corporation or the
voluntary institution by the other party or the Corporation
of any proceeding under any statute of any governmental
authority for the relief of debtors, seeking relief from or
readjustment of its indebtedness, either through
reorganization, composition, extension or otherwise, or the
involuntary institution against the other party or the
Corporation of any such proceeding which is not vacated
within sixty days from the institution thereof, or the
appointment of a receiver, custodian or other officer
having similar powers for the other party or the
Corporation or for the other party's or the Corporation's
business who is not removed within sixty days after such
appointment;
(iii) any breach or violation by the other party of any
obligation contained in this Agreement (including, without
limitation, the exclusivity provisions of Section 19
hereof), or in any other agreement between such party and
the Corporation or the other party hereto, which breach or
violation is not corrected within thirty (30) days after
written notice thereof; or
(iv) if the Corporation shall fail to achieve the minimum goal
set forth in Section 9(a) hereof, unless both parties
hereto agree to take such actions as may be mutually
satisfactory to achieve such minimum goals within the next
year and at all times thereafter.
(v) if the Corporation shall fail to meet any applicable Target
Approval Rates as may be mutually agreed to by NMHG and
GECC, from time to time pursuant to the provisions as set
forth in Section 31 hereof, unless both parties hereto
agree to take such actions as may be mutually satisfactory
to achieve such minimum approval rates within the next year
and at all times thereafter.
(vi) if the parties hereto shall fail to meet the provisions of
the timetable set forth in Section 32 hereof.
(c) If this Agreement terminates for any reason whatsoever, the
obligations of either party hereto under this Agreement and the Other Agreements
shall not be affected or impaired in any manner except as specifically provided
for in such agreements. NMHG and GECC agree to take such action as may be
necessary to cause the Corporation to cease providing any new Wholesale
Financing, Retail Financing or other financing after the effective date of the
termination (including, but not limited to, calling, terminating or otherwise
canceling any Wholesale Financing, Retail Financing or other financing as of
such date to the extent legally permitted). NMHG and GECC further agree that,
upon the effective date of such termination, they will cause the Corporation to
immediately wind up its business and affairs and shall proceed to liquidate and
dissolve the Corporation. Such liquidation and dissolution shall be achieved
through an orderly
Page 14
program calculated to protect the interests of each of NMHG and GECC and shall
take place over a period of time not to exceed the unexpired term of any
contract for financing provided by the Corporation outstanding on the effective
date of termination (which contract cannot legally be called, terminated or
otherwise canceled by the Corporation) plus six months. In such event, the
parties agree that they will use their best efforts to effect the prompt
liquidation and dissolution of the Corporation and to bring about the
distribution of the assets of the Corporation in accordance with the provisions
of this Agreement. The provisions of this Section 14(c) to the contrary
notwithstanding, it is understood by the parties hereto that the Corporation
shall not make distributions "in kind" except upon their prior mutual agreement.
15. DISSOLUTION OF VENTURE.
(a) In the event that the Corporation be dissolved and liquidated,
the proceeds of such liquidation shall be applied and distributed in the
following order of priority, except to the extent otherwise required by
applicable provisions of law:
(i) First, to the payment of debts and liabilities of the
Corporation (other than any debts and liabilities owed to
either of the parties hereto) and the expenses of
liquidation;
(ii) Next, to the payment of any debts and liabilities of the
Corporation to either of the parties hereto; and
(iii) Finally, the balance of the assets remaining after the
distributions set forth under (i) and (ii) above, PRO RATA
to the shareholders in accordance with the Shares held by
them at the time of distribution.
(b) It is understood that the Corporation shall, from time to time
and as available, make interim cash distributions to the parties hereto, PRO
RATA to the shareholders in accordance with the Shares held by them at the time
of distribution.
16. NMHG'S STOCK OPTION.
(a) The provisions of Section 14(c) to the contrary notwithstanding,
upon the termination of this Agreement by GECC for cause, or by NMHG for cause,
pursuant to Section 14(b) above, then NMHG shall be entitled, at its sole
option, to purchase all, but not less than all, of the Shares of the Corporation
held by GECC (the "GECC Shares"), such purchase to be made in accordance with
the provisions of this Section 16. In order to exercise its option hereunder
(the "Stock Option"), NMHG shall give written notice to GECC to such effect no
later than forty-five (45) days after NMHG has given or received written notice
of termination of the kinds described above.
(b) The purchase price ("Purchase Price") for the GECC Shares under
the Stock Option shall be the "net book value" (as hereinafter defined) of such
GECC Shares determined as of the date on which such GECC Shares are purchased
and sold (the
Page 15
"Purchase Date"). For purposes of this Section 16, the "net book value" of the
GECC Shares shall be determined by reference to the "net book value of the
Corporation" on the Purchase Date. The "net book value of the Corporation" shall
be determined in accordance with generally accepted accounting principles and
the regular methods and practices used by the Corporation in keeping its books,
applied on a consistent basis, except that the following provisions, even though
not necessarily consistent with generally accepted accounting principles, shall
apply:
(i) Goodwill, trade names, trademark, copyrights and similar
intangible assets shall be of no value unless such assets
shall have been acquired and paid for in cash and, in such
event, the value thereof, if any, shall be taken at the
amount paid therefor, less any amortization thereof;
(ii) Fixed assets, if any, consisting of, but not limited to,
furniture and fixtures, shall be taken at cost less
accumulated depreciation;
(iii) Real estate, if any, shall be stated at the fair market
value thereof, as determined by an independent appraiser to
be selected by the mutual consent of NMHG and GECC;
(iv) Money-over-money retail contracts and wholesale contracts
shall be at the outstanding principal balance thereof, plus
all accrued and unpaid interest, late charges and other
amounts due thereunder;
(v) True leases shall be at the termination value thereof (as
of the rental payment date immediately preceding the
Purchase Date) and all rentals, late charges and other
amounts under such leases that are due and unpaid as of the
Purchase Date;
(vi) Adequate provisions for reserves for federal, state and
local taxes shall be accrued and applied as a liability as
of the balance sheet date;
(vii) All loss reserves shall be valued at zero;
(viii) Prepaid insurance and other prepaid expenses and charges
shall be reflected as prepaid assets as of the balance
sheet date; and
(ix) Adequate provisions for accounts payable and any other
known liabilities of the Corporation shall be taken as a
liability as of the balance sheet date.
(c) On the Purchase Date, NMHG shall make an initial payment ("Initial
Payment") to GECC in an amount equal to the estimated "net book value" of the
GECC Shares as indicated on the books and records of GECC as of the Purchase
Date and shall be paid by wire transfer of immediately available funds to an
account designated by GECC.
Page 16
(d) On or before the date ninety (90) days from the Purchase Date, GECC
shall submit to NMHG an unaudited balance sheet of the Corporation dated as of
the Purchase Date ("Purchase Date Balance Sheet") which shall be prepared in
accordance with generally accepted accounting principles by GECC. If requested
by NMHG by written notice delivered to GECC no later than 30 days after the
receipt of the Purchase Date Balance Sheet, the independent public accountants
regularly engaged by the Corporation will audit (the "Audit"), at NMHG's sole
cost and expense, the Purchase Date Balance Sheet. Such Audit shall be conducted
in accordance with generally accepted audit standards and shall be sufficient to
permit such accountants to render their unqualified opinion to the effect that
the original Purchase Date Balance Sheet, or an adjusted Purchase Date Balance
Sheet prepared by such accountants ("Adjusted Purchase Date Balance Sheet"),
fairly presents the consolidated financial position of the Corporation on the
Purchase Date in conformity with generally accepted accounting principles
(except as set forth in subsection (b) above) applied on a consistent basis. The
Audit shall be final, binding and conclusive on the parties. If NMHG does not
request for any reason whatsoever the Audit in the time and manner required by
this Section 16(d), then the original Purchase Date Balance Sheet shall be
deemed final, binding and conclusive on the parties.
(e) On the date which is the thirtieth (30th) day following the date of
delivery to NMHG of the Purchase Date Balance Sheet (or, alternatively, the
fifth (5th) business day following the date on which the audit requested
pursuant to paragraph (d) above is finalized), the Purchase Price shall be
adjusted as follows:
(i) if the Purchase Price pursuant to the Purchase
Date Balance Sheet exceeds the Initial Payment, NMHG shall pay to GECC
the difference between said amounts (plus interest thereon at the Prime
Rate that was in effect on the Purchase Date calculated from the
Purchase Date); however
(ii) if the amount of the Initial Payment exceeds the
Purchase Price, pursuant to the Purchase Date Balance Sheet, GECC shall
pay to NMHG the difference between said amounts (plus interest thereon
at the Prime Rate that was in effect on the Purchase Date calculated
from the Purchase Date).
As used herein, the "Prime Rate" shall mean the highest rate of
interest announced by any member bank of the N.Y. Clearinghouse Association as
its prime or base lending rate for commercial loans of short term maturities.
(f) The Purchase Date for the Stock Option shall be on the later of
(i) the effective date of termination of this Agreement or (ii) the expiration
of any waiting period imposed under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, if applicable. On the Purchase Date, NMHG shall pay to GECC
the Purchase Price for the GECC
Page 17
Shares (determined on the basis of the Purchase Date Balance Sheet but subject
to the possibility of a Post-Closing Adjustment). Such payment shall be made by
wire transfer of NMHG to GECC against delivery of the GECC Shares in the
following manner: certificates representing such Shares shall be endorsed in
blank, with signatures guaranteed. THE PURCHASE BY NMHG OF THE GECC SHARES SHALL
BE WITHOUT ANY RECOURSE TO, OR REPRESENTATIONS OR WARRANTIES OF ANY KIND
WHATSOEVER BY, GECC, except that (i) GECC has been duly and validly organized,
and is a validly existing corporation, under the laws of the State of New York
with full power and authority to sell the GECC Shares to NMHG, (ii) the sale of
the GECC Shares has been duly authorized by GECC, and (iii) GECC has good and
marketable title to the GECC Shares and has the absolute right, power and
capacity to sell assign and transfer the GECC shares to NMHG free and clear of
any liens, claims and encumbrances arising by, through or under GECC (other than
restrictions imposed generally by state and federal securities laws with respect
to unregistered securities).
(g) Anything in the foregoing to the contrary notwithstanding, the
Stock Option shall be deemed null and void, and GECC shall have no duty or
obligation under this Section 16 or otherwise to sell the GECC Shares to NMHG,
if such sale would require such GECC Shares or the transaction to be registered
under any applicable federal or state securities laws. In connection with any
purchase of the GECC Shares pursuant to the Stock Option, NMHG understands and
agrees that it will be required to provide GECC with representations and
warranties substantially similar to those contained in Section 4.6 of the Stock
Purchase Agreement.
(h) In the event that NMHG exercises its Stock Option, NMHG shall,
unless GECC has terminated this Agreement without cause, be obligated to
reimburse GECC upon demand for all out-of-pocket fees, costs and expenses of any
kind whatsoever incurred by GECC in connection therewith and/or in connection
with its sale of the GECC Shares to NMHG (including, without limitation, any
fees and disbursements of outside counsel or outside accountants and any costs
related to the prepayment of any debt incurred by GECC as a result of its
obligations under the Financing Agreement).
Page 18
17. STAFFING AND ORGANIZATION EXPENSES.
(a) NMHG shall initially supply frontroom personnel (frontroom
personnel are those that primarily dedicate their time to working on Wholesale
and Retail Financing prior to closing and booking) to both the Hyster and Yale
divisions of the Corporation to the extent of a total of 20 personnel, which
personnel shall compromise the following positions: managers, field
representatives, account representatives, wholesale administrators and
administrative assistants. All salary, benefits and other employee costs for
such NMHG supplied personnel will not exceed $1.8 million in the first calendar
year and will be charged to the Corporation. To the extent that GECC supplies
frontroom personnel, all salary, benefits and other employee costs for such GECC
supplied personnel will not exceed $1.5 million in the first calendar year and
will be charged to the Corporation. All such personnel (whether supplied by NMHG
or GECC) will be fully dedicated to the Corporation. Frontroom staffing, and the
costs associated therewith, for the period following the first year of operation
under this Agreement shall be mutually agreed upon by the parties from time to
time based on the needs of the Corporation. Frontroom locations will be at
Hyster and Yale brand headquarters and/or such other location(s) designated by
Hyster and Yale, respectively.
(b) GECC shall perform all administrative responsibilities with
respect to all Wholesale and Retail Financing entered into by the Corporation
pursuant to the terms of the Revised and Restated Administrative Services
Agreement attached hereto as Exhibit E.
(c) The Corporation will pay all reasonable external, out-of-pocket
expenses incurred by NMHG and GECC in connection with the establishment of the
Corporation, the qualification and licensing of the Corporation and preparation
of the documentation for Wholesale and Retail Financing; provided, however, that
the specific type of out-of-pocket expenses to be borne by the Corporation are
mutually agreed to by GECC and NMHG in writing.
(d) The Corporation will pay or reimburse all external, out-of-pocket
expenses incurred by NMHG and/or GECC in connection with the design, creation
and publication of financing and remarketing literature, bulletins, price sheets
and promotional literature, provided, however, that the specific type of
out-of-pocket expenses to be borne by the Corporation are mutually agreed to by
GECC and NMHG in writing.
18. TRADEMARKS.
(a) GECC hereby waives any right, title and interest in and to the
trade names "NMHG", "NMHG Financial Services", "Hyster Credit" and "Yale
Financial Services", as well as any and all variations thereof, and the related
trademarks. NMHG hereby grants to GECC, on the same basis as NMHG has already
granted to the Corporation under the Tradename Agreement, the right to use the
tradenames "NMHG", "NMHG Financial Services", "Hyster Credit" and "Yale
Financial Services" and the related trademarks in
Page 19
connection with the performance of GECC's obligations hereunder or under any of
the Other Agreements.
(b) NMHG hereby waives any right, title and interest in and to the
trade names "General Electric Company", "GE", "General Electric Capital
Corporation" and "GECC", as well as any and all variations thereof, and the
related service marks and trademarks.
19. EXCLUSIVITY.
(a) As to GECC, GECC will endeavor to not enter into any other
significant financing program arrangements with NMHG Competitors. GECC shall
additionally endeavor not to develop any business unit whose primary function is
to finance forklift trucks. For the purposes of this paragraph the term "NMHG
Competitors" shall be as set forth on Exhibit H attached hereto which shall be
amended from time by mutual agreement of the parties hereto.
(b) AS TO NMHG. NMHG will endeavor to not solicit, or enter into, any
Retail or Wholesale Financing (or enter into any partnership, joint venture or
other arrangement with any other party to provide any of the foregoing) for
either NMHG or Allied Equipment, except that NMHG may make equity investments
in, or general loans and other extensions of credit to or for the benefit of,
Dealers from time to time which may be secured by general liens on inventory,
receivables, equipment and other assets of the Dealer.
20. CONFIDENTIALITY.
All information with respect to the Corporation, NMHG or GECC, or
with respect to the business, operations, products and customers of the
Corporation, NMHG or GECC, shall be kept confidential and shall not be disclosed
to third parties, except for (i) any disclosures required by law or required to
be made to any governmental agencies, or (ii) with respect to the Corporation,
any disclosures to its independent certified public accounting firm or to other
persons or entities that may need to know for the purpose of the business or
operations of the Corporation, or (iii) any disclosures of information that was
in the public domain at the time of receipt or subsequently comes into the
public domain (other than as a result of an unauthorized disclosure), or (iv)
disclosures of the type that are customary in the ordinary course of business
(e.g., the terms of financing available from the Corporation).
21. WAIVER.
Waiver by any party hereto of any breach or default by any other
party of any of the terms and conditions of this Agreement shall not operate as
a waiver of any other breach or default, whether similar to or different from
the breach or default waived.
22. NOTICES.
Page 20
Any notices or other communications required or permitted hereunder
shall be sufficiently given if personally delivered or sent by registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
TO NMHG:
NACCO Materials Handling Group, Inc.
650 NE Holladay Street
Suite 1600
Portland, Oregon 97232
Attn: General Counsel
TO GECC:
General Electric Capital Corporation
44 Old Ridgebury Road
Danbury, CT 06810
Attention: Edward Simoneau
Either party hereto may change the address to which each such notice
or communication shall be sent by giving written notice of such change of
address to the other party hereto in the manner above stated.
23. ENTIRE AGREEMENT; AMENDMENTS.
This Agreement (along with the attached Exhibits) represents the
entire understanding and agreement between the parties hereto with respect to
the subject matter hereof and supersedes all prior negotiations, representations
and agreements made by and among the parties with respect thereto. No
alteration, amendment, assignment or modification of any of the terms or
provisions of this Agreement shall be void unless made pursuant to an instrument
in writing signed by each of the parties hereto; provided that the waiver by
either party hereto of compliance with a provision hereof or of any breach or
default by the other party hereto need be signed only by the party waiving such
provision, breach or default.
24. ADOPTION BY CORPORATION; LEGEND ON CERTIFICATES.
(a) Each of NMHG and GECC agrees that it will consent to and approve
any amendment to the Certificate of Incorporation or By-Laws of the Corporation
which may be necessary or advisable in order to conform to any of the provisions
of this Agreement or any amendments hereto to the applicable laws of the State
of Delaware as now or hereafter enacted, including, without limitation, the
General Corporation Law of the State of Delaware. Each party further agrees to
vote its Shares in the Corporation and to
Page 21
execute and deliver such documents as may be necessary in order to implement the
provisions of the preceding sentence.
(b) The certificates representing the Shares shall have endorsed upon
them the following legend:
The sale, assignment, transfer, pledge, encumbrance or
hypothecation of the Shares represented by this Certificate are
subject to compliance with the terms and conditions of a Joint
Venture and Shareholders Agreement, dated November 8, 1989, as
amended and restated on April 15, 1998 by and between NMHG
Materials Handling Corporation and General Electric Capital
Corporation, a copy of which is on file at the offices of the
Corporation.
25. COUNTERPARTS.
This Agreement may be executed in any number of counterparts each of
which shall be an original, but all of which taken together shall constitute one
and the same instrument.
26. SUCCESSORS AND ASSIGNS.
Neither party hereto may sell, assign, transfer, pledge, encumber or
hypothecate any of its rights or obligations hereunder or any Shares without the
prior written consent of the other party hereto. Any attempted sale, assignment,
transfer, pledge, encumbrance or hypothecation in violation of this Section
shall be void and of no force and effect. All of the terms and provisions of
this Agreement shall inure to the benefit of and be binding upon the successors
and assigns of the parties hereto.
27. SECTION HEADINGS.
All of Sections, subsections and clauses contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
28. GOVERNING LAW AND ARBITRATION.
This Agreement shall be construed and enforced in accordance with the
laws of the State of New York. Any and all disputes, controversies or claims
arising out of, or relating to, this Agreement or any of the Other Agreements
shall be determined by arbitration in accordance with the Arbitration Rules of
the American Arbitration Association. The number of arbitrators shall be three.
One arbitrator each shall be appointed by NMHG and GECC respectively, and the
third arbitrator, who shall serve as chairman of the tribunal, shall be
appointed by the American Arbitration Association. The place of arbitration
shall be New York City. The language of the arbitration shall be English and any
arbitral award arising from any arbitration pursuant to this paragraph
Page 22
shall be final and binding upon all parties hereto and no party shall seek
recourse to a court of law or other authorities to appeal for revision of such
decision or any other ruling of the arbitrator. The cost of the arbitration
shall be borne by the party who does not prevail in the arbitration proceeding
or as is otherwise decided by the arbitration panel. The question of whether a
dispute is governed by this arbitration clause shall itself be determined by
arbitration.
29. SEVERABILITY OF PROVISIONS.
If any covenant or other provision of this Agreement is invalid,
unlawful, or incapable of being enforced by reason of any rule of law or public
policy, all other covenants and provisions of this Agreement which can be given
effect without the invalid, unlawful or unenforceable provision shall,
nevertheless, remain in full force and effect, and no covenant or provision
shall be deemed dependent upon any other covenant or provision unless so
expressed.
30. ADVERTISING.
Without the prior written consent of the other party hereto, neither
NMHG nor GECC shall advertise in any manner the financial services of the
Corporation (whether by written brochure, newspaper advertisement, radio
commercial, television commercial or otherwise), even if such advertisement is
intended solely for the Dealers and the Customers, except that NMHG may
advertise the financial services of the Corporation without mentioning GECC and
without the consent of GECC, but, if NMHG does so without the prior written
consent of GECC, NMHG shall be solely responsible for any costs or liabilities
arising from any such advertisement.
31. TARGET APPROVAL RATES.
GECC will use its best efforts to coordinate with NMHG to initially
determine mutually acceptable standards for the approval of Customers for
proposed Yale and Hyster Retail Financings ("Target Approval Rates"). Target
Approval Rates shall be reviewed by each of the Yale and Hyster Steering
Committees annually with their recommendations being submitted to the Board of
Directors. Target Approval Rates applicable to any calendar year following the
end of the calendar year in which this Agreement is executed shall be set by the
Board of Directors at the Annual Meeting of the Board of Directors for such
calendar year.
32. TIMETABLE.
GECC and NMHG will mutually commit to work together to achieve the
following schedule for implementation of the terms of this Agreement and the
related International Operating Agreement:
(a) TWO MONTH TIME FRAME. Within two (2) months after the date upon
which this Agreement shall become effective ("Effective Date"):
Page 23
(i) GECC will provide full and workable Retail and Wholesale
Financing structures for the U.S. and Phase One Countries.
(ii) GECC and NMHG will develop mutually acceptable Target
Approval Rates pursuant to the terms of Section 31 hereof to be
operational for the U.S. and for all Phase One Countries.
(iii) GECC and NMHG will cooperate to ensure that all legal
requirements for operations under this Agreement and in the Phase
One Countries are met, marketing literature is produced, Wholesale
and Retail documentation is printed, Wholesale and Retail rates
are set and relevant personnel are appointed.
(iv) GECC must ensure that the Corporation and any applicable GECC
affiliates or subsidiaries have the legal, financial and
operational capacity to provide commercially acceptable financing
in the U.S. and Phase One Countries.
(b) PHASE TWO COUNTRIES TIME FRAME. Within six (6) months after the
Effective Date, GECC and NMHG shall ensure that all of the requirements set
forth in subparagraphs (a)(i), (ii) (iii) and (iv) are met with respect to all
Phase Two Countries.
(c) PHASE THREE COUNTRIES TIME FRAME. Within twelve (12) months after
the Effective Date, GECC and NMHG shall ensure that all of the requirements set
forth in subparagraphs (a)(i), (ii) (iii) and (iv) are met with respect to all
Phase Three Countries.
(d) PHASE FOUR COUNTRIES. GECC and NMHG shall ensure that all of the
requirements set forth in subparagraphs (a)(i), (ii) (iii) and (iv) are met with
respect to all Phase Four Countries within the time frame agreed to by the
parties.
(e) With respect to this Section 32, the terms "Phase One Countries",
"Phase Two Countries", "Phase Three Countries" and "Phase Four Countries" shall
be defined as follows:
(i) Phase One Countries shall be Canada, the United Kingdom,
Germany and France.
(ii) Phase Two Countries shall be Australia, Brazil, Chile, The
Netherlands, Mexico and Spain.
(iii) Phase Three Countries shall be Argentina, Poland, Hungary,
Czech Republic, Italy, Malaysia and Taiwan.
(iv) Phase Four Countries shall be any other countries mutually
agreed upon by GECC and NMHG.
33. PARTICIPATION FEE.
Page 24
In consideration for the referral by NMHG to the Corporation of Tax
Leases for Hyster and Yale forklift trucks, the Corporation shall pay to NMHG an
annual "PARTICIPATION FEE". During the term of this Agreement, the Participation
Fee will be paid to NMHG within sixty (60) days of the close of any calendar
year and shall be based on the aggregate volume of Tax Leases related to Hyster
and Yale forklift trucks booked by the Corporation in such calendar year. The
calculation of the Participation Fee shall be done in the manner as set forth in
Exhibit I (attached hereto). For the purposes of this Section 33, the term "Tax
Lease" shall mean any financial transaction which is in the form of a lease or
rental agreement under which the Corporation is the lessor, and owner for
Federal income tax purposes, of the Equipment leased thereunder.
34. COMPETITIVENESS.
Both GECC and NMHG will use their best efforts to ensure that the
Corporation offers products which are competitive within the U.S. market. The
Company shall provide to Dealers and Customers (as the case may be) financing at
the following rates:
(i) For Wholesale Financing, the interest rate shall not exceed 50
Basis Points over the Prime Rate where (x) the Prime Rate shall mean
the per annum rate of interest announced, from time to time, by The
First National Bank of Chicago (or such other major banking
institution as chosen by the Company) as its "corporate base rate"
and (y) the term Basis Point shall mean one hundredth (100th) of one
percent (1%);
(ii) For Retail Financing, the interest rate shall not exceed 325 Basis Points
over the then applicable interest rate of Treasury Bills offered for terms
similar or identical to the term of each applicable Retail Financing. For each
Retail Financing, an interest rate quote to any Customer shall be valid for a
term equal to the earlier of thirty days from such quote or the end of a
calendar year and, for a Retail Financing transaction approved by the Company,
the applicable interest rate will be effective for a term equal to the earlier
of ninety days from such approval or the end of a calendar year.
35. CONDITION PRECEDENT.
This Agreement shall not be effective unless and until that certain
Third Amended and Restated Operating Agreement between Hyster Company and Hyster
Credit Corporation dated as of November 21, 1985, as amended and restated as of
December 19, 1985 (the "AT&T Agreement") is terminated and all transactions
after such termination date which would have been subject to the terms of said
AT&T Agreement are referred to the Corporation.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement on the day and year first above written.
Page 25
NACCO MATERIALS HANDLING
GROUP, INC.
By: /s/ Reginald R. Eklund
-------------------------------------
Title: President
----------------------------------
GENERAL ELECTRIC CAPITAL
CORPORATION
By: /s/ Christopher H. Richmond
-------------------------------------
Title: Vice President and General Manager
----------------------------------
Page 26
Dates Referenced Herein and Documents Incorporated by Reference
4 Subsequent Filings that Reference this Filing
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