FILED: NEW YORK COUNTY CLERK 07/28/ :23 PM INDEX NO /2015 NYSCEF DOC. NO. 56 RECEIVED NYSCEF: 07/28/2015 EXHIBIT 30

Transcription

1 FILED: NEW YORK COUNTY CLERK 07/28/ :23 PM INDEX NO /2015 NYSCEF DOC. NO. 56 RECEIVED NYSCEF: 07/28/2015 EXHIBIT 30

2 STANDSTILL AGREEMENT THIS STANDSTILL AGREEMENT (this Agreement ) is dated as of May 13, 2014 ( Effective Date ) and is entered into by and among TRANSIT FUNDING ASSOCIATES LLC, a Delaware limited liability company ( Borrower ), CAPITAL ONE EQUIPMENT FINANCE CORP. d/b/a/ Capital One Taxi Medallion Finance, a New York corporation with its principal office located at 275 Broadhollow Road, Melville, New York ( Bank ), YELLOW GROUP LLC, a Delaware limited liability company authorized to transact business in the State of Illinois ( YG ) and Taxi Affiliation Services LLC, a Delaware limited liability company authorized to transact business in the State of Illinois ( TAS ), TAXI MEDALLION MANAGEMENT LLC, a Delaware limited liability company authorized to transact business in the State of Illinois ( TMM ), and CL MEDALLION HOLDINGS LLC, a Delaware limited liability company authorized to transact business in the State of Illinois ( CLMH ), and YELLOW MEDALLION HOLDINGS LLC, a Delaware limited liability company authorized to transact business in the State of Illinois ( YMH ), YC1 LLC, a Delaware limited liability company authorized to transact business in the State of Illinois, with a place of business at 3351 W. Addison, Chicago, Illinois ( YC1 ), YC2 LLC, a Delaware limited liability company authorized to transact business in the State of Illinois, with a place of business at 3351 W. Addison, Chicago, Illinois ( YC2 ), YC17 LLC, a Delaware limited liability company authorized to transact business in the State of Illinois, with a place of business at 3351 W. Addison, Chicago, Illinois ( YC17 ), YC18 LLC, a Delaware limited liability company authorized to transact business in the State of Illinois, with a place of business at 3351 W. Addison, Chicago, Illinois ( YC18 ), YC19 LLC, a Delaware limited liability company authorized at transact business in the State of Illinois, with a place of business at 3351 W. Addison, Chicago, Illinois ( YC19 ), YC20 LLC, a Delaware limited liability company authorized to transact business in the State of Illinois, with a place of business at 3351 W. Addison, Chicago, Illinois ( YC20 ), YC21 LLC, a Delaware limited liability company authorized to transact business in the State of Illinois with a place of business at 3351 W. Addison, Chicago, Illinois ( YC21 ), YC22 LLC, a Delaware limited liability company authorized to transact business in the state of Illinois with a place of business at 3351 W. Addison, Chicago, Illinois ( YC22 ), MICHAEL LEVINE, an individual with an address at 33 Grand Park Avenue, Scarsdale, New York ( Levine ), and PATTON CORRIGAN, an individual with an address at 9816 Brassie Bend, Naples, Florida ( Corrigan ) (YG, TAS, TMM, CLMH, YMH, YC1, YC2, YC17, YC18, YC19, YC20, YC21, YC22, Levine, and Corrigan are each, a Guarantor and, collectively the Guarantors ; and together with the Borrower, collectively the Credit Parties, and each a Credit Party ). A. Reference is made to that certain: RECITALS 1. Loan and Security Agreement dated April 6, 2012 by and between the Borrower and the Bank, as previously amended, modified, restated and extended from time to time (as amended, modified, restated and extended, the Loan Agreement ); 2. Revolving Advised Line of Credit Promissory Note dated April 6, 2012 by the Borrower in favor of the Bank in the original principal amount of $80,000,000.00, as previously amended, modified, restated and extended from time to time (as amended, modified, restated and extended, the Revolving Line Note ), which Revolving Line Note, together with the Loan Agreement, evidences the Loan made by the Bank to the Borrower in such amount (the Revolving Loan ); and 3. Guaranty agreements, each respectively entered into, by each of the respective Guarantors in favor of the Bank with respect to the obligations of the Borrower owing to the Bank (collectively, the Revolving Guaranty ); 4. All other documents executed and delivered, and all other communications, by the Bank and the Credit Parties. B. The matters enumerated in paragraph A above and any and all other documents, agreements, instruments, modifications, affirmations and certifications executed and delivered in connection with the Revolving 1

3 Loan, as amended, restated, supplemented or otherwise modified from time to time, are hereinafter collectively referred to as the Loan Documents. Capitalized terms used but not otherwise defined herein shall have the meanings assigned thereto in the Loan Documents. C. Each Credit Party acknowledges and confirms that the Revolving Line Note matured by its terms on December 1, 2014 at which time all obligations of the Borrower to the Bank became due and payable in full. The Borrower failed to pay in full at maturity all of its obligations under the Revolving Line Note; this failure to pay constitutes an Event of Default under the Loan Agreement (the Maturity Default ). In addition to the Maturity Default each Credit Party acknowledges and confirms there presently exist other defaults and events of default under the Loan Document, as more specifically delineated on Exhibit A (and collectively with the Maturity Default, the Specified Defaults ). Each of the Credit Parties further acknowledges and confirms that the Specified Defaults (i) are continuing; (ii) are material in nature; and (iii) have not been waived by Bank or cured by the Borrower, any Guarantor or any other Person. D. Each Credit Party further acknowledges and confirms that (i) by letter dated March 6, 2015 the Bank delivered a written default notice to the Credit Parties of the Maturity Default and any other Defaults, and (ii) as a result of the occurrence and continuance of the Specified Defaults, (x) the Revolving Line Note, all interest on the outstanding obligations under the Revolving Line Note, and all other amounts payable under the Loan Agreement, Revolving Line Note and the other Loan Documents at the sole and absolute discretion of the Bank may be immediately due and payable in full, and the Bank has no obligation to make any financial accommodations to Borrower under the Loan Documents or otherwise and (y) the Bank has had, and currently has, the continuing right to decline to extend any credit to Borrower, to demand full payment of all liabilities and obligations of the Borrower owing to the Bank (collectively, the Liabilities ), and enforce the collection of all the Liabilities, including by commencing legal proceedings or foreclosing or realizing upon any liens or security interests, among other rights and remedies accorded to the Bank under the Loan Documents and by applicable law, including obtaining a judgment upon which interest shall accrue at the higher of: (i) the then-applicable rate of interest to which the Bank is entitled hereunder, or (ii) the statutory rate of interest applicable to money judgments in the state where such money judgment is entered, which interest at either aforementioned rate shall continue to accrue and be payable in any bankruptcy case of the Borrower or any Guarantor under Title 11 of the United States Code (the Bankruptcy Code ) (collectively, the Rights and Remedies ). Notwithstanding the foregoing, however, at the request of, and as an accommodation to, the Borrower, the Bank, in its sole and absolute discretion, without waiving the Specified Defaults or any of its Rights and Remedies in respect of the Specified Defaults or any other Default, has elected to forbear from exercising the Rights and Remedies to the date of this Agreement. E. The Parties desire to engage in discussions whereby the Parties may consider an amendment of the Loan Agreement and related documents, without waiving or prejudicing their respective rights, claims and defenses with respect to the Loan Documents or otherwise as the same may exist as of the date hereof. NOW, THEREFORE, in consideration of the terms herein contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby mutually acknowledged, the Parties agree as follows: 1. Standstill. From the date hereof, to and including June 15, 2015, unless earlier terminated by the Bank or any Credit Party upon at least five (5) business days prior written notice to all other Parties (the Standstill Period ), without waiving the Specified Defaults, the Bank agrees to forbear from exercising the Rights and Remedies, solely to the extent such Rights and Remedies arise from the Specified Defaults; provided, however, that: a. no Default under the Loan Documents or this Agreement, other than the Specified Defaults, has occurred and is continuing (or hereafter occurs); b. all representations and warranties made by the Credit Parties to the Bank in connection with this Agreement remain true, correct and complete; 2

4 c. Borrower shall maintain its current depository relationship with the Bank; d. each Credit Party agrees that the Bank is under no obligation to make Revolving Loan advances, which obligations are terminated as of the date hereof, and that any payment made by any Credit Party on account of the outstanding principal under the Revolving Line Note shall be a permanent pay down of principal and may not be re-borrowed; e. no Credit Party shall make investments in, or loans or advances to, any individual, partnership, corporation, limited liability company, trust or other organization or person, including any entities under, direct or indirect, common ownership with the Borrower or any Guarantor; notwithstanding the foregoing, a Credit Party may make investments in, or loans or advances to any individual, partnership, corporation, limited liability company, trust or other organization or person, including any entities under, direct or indirect, common ownership with the Borrower or any Guarantor that is exclusively engaged in the public taxi business in a collective aggregate amount not to exceed Twenty Five Thousand and 00/100 Dollars ($25,000.00) during the Standstill Period; f. the Borrower shall not, without prior written consent of the Bank, pay any dividends on, or make any distribution on account of, any Guarantor s equity interests in cash or in property, or redeem, purchase or otherwise acquire, directly or indirectly, any of such membership interests; and g. Within five (5) days of the date hereof, the Guarantors shall each deliver to the Bank sworn financial statements and reports in form and substance satisfactory to the Bank, as shown on Exhibit B. 2. Tolling. All statutes of limitation applicable to any legal proceedings the Parties may commence to enforce their respective rights and remedies shall be deemed tolled during the Standstill Period and each time period provided in each such statute of limitations shall be extended by a period of time equal to the duration of the Standstill Period plus sixty (60) days. The tolling effected by this paragraph shall inure only to the benefit of the Bank and shall not be construed as enlarging any period within which the Credit Parties may, or are required to, act under the Loan Documents or this Agreement. 3. No Waiver, Modification or Commitment. (a) The Credit Parties acknowledge and agree that consent to this Agreement by the Bank shall not in any way be considered to be a cure of the Specified Defaults or any Default which may have occurred or may hereafter occur under the Loan Documents. After the Standstill Period, nothing contained herein shall constitute a waiver by the Bank of its right to declare all amounts outstanding under the Revolving Line Note as to principal, interest or otherwise to be immediately due and payable, proceed against any Collateral, or to otherwise exercise any of the other rights and remedies of the Bank as provided in the Loan Documents or by applicable law after the Standstill Period, nor shall any provision contained herein result in the Bank being estopped from exercising any rights and remedies after the Standstill Period. (b) The Bank acknowledges and agrees that consent to this Agreement by the Credit Parties shall not in any way be considered to be a waiver of any rights, claims or defenses they may have with respect to any claims, rights or remedies asserted by the Bank under the Loan Documents or otherwise, nor shall any provision contained herein result in any Credit Party being estopped from asserting any right, claim or defense against the Bank after the Standstill Period. (c) This Agreement does not represent (i) a commitment by the Bank to make any new loans or to grant or extend any financial accommodations to any Credit Party except as otherwise expressly provided herein, (ii) a commitment by the Bank to restructure the Revolving Loan 3

5 or extend financial accommodations with respect to the Revolving Loan except as otherwise provided herein, or (iii) an intention by the Bank to waive, modify or, except as expressly set forth herein, forbear from exercising any of its rights, powers and privileges under the Loan Document. The Credit Parties acknowledge, agree and confirm that no such commitment, waiver, modification, or, except as set forth herein, forbearance, has been offered, granted, extended or agreed to by the Bank and that no previous written or oral act or omission of the Bank, its officers, directors, employees or agents, whether or not such act or omission was intentional, constitutes a waiver or estoppel of any of the Bank s Rights and Remedies against the Credit Parties under the Loan Documents and applicable law. (d) The Parties acknowledge and agree that no other Party has made any representations as to what actions, if any, they will take after the Standstill Period and the Parties hereby specifically reserve any and all rights, remedies and claims they may have (after giving effect hereto) with respect to any rights, remedies, claims or defenses. 4. Inducements to the Bank. Representations. As inducements to the entry into this Agreement by the Bank and its performance hereunder: Each Credit Party hereby represents and warrants to the Bank that: i. the execution, delivery and performance by such Credit Party of this Agreement (A) (other than with respect to the Guarantors who are individuals) has been duly authorized by all necessary corporate or other organizational action of such Credit Party and (B) does not (x) contravene or violate any of the organizational or constitutive documents of such Credit Party (other than the Guarantors who are individuals) or (y) contravene or violate any contractual restriction, law or governmental regulation or court decree or order binding or affecting such Credit Party; ii. iii. iv. the officer(s) of the Borrower and the entity Guarantors executing this Agreement have been duly authorized and empowered to do so by all necessary corporate or other organizational action of the Borrower and the entity Guarantors on behalf of each, and to bind the Borrower and the entity Guarantors accordingly thereby; this Agreement constitutes, upon its execution and delivery, the legal, valid and binding obligations of each Credit Party enforceable against such Credit Party in accordance with its respective terms; there is owing by the Borrower under the Revolving Line Note as of the Effective Date hereof without offset, counterclaim, recoupment or defenses of any kind, the principal amount of $57,201, plus accrued and unpaid interest, together with such other fees, expenses and other amounts which are chargeable or otherwise reimbursable under the Loan Agreement, Revolving Line Note and the other Loan Documents; v. the Credit Parties acknowledge that the security interest securing the obligations of the Credit Parties to the Bank constitutes first-priority security interests and liens on the Collateral described in the Loan Agreement, and that no Credit Parties shall take any action to impair or invalidate such security interest; vi. the representations and warranties of the Credit Parties set forth in the Loan Agreement and in the other Loan Documents are true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the Effective Date, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties are true and correct in all material respects (or true and correct, as the case may be) as of such earlier date); 4

6 vii. viii. ix. on its own behalf and on behalf of its successors and assigns hereby releases (i) the Bank and all of the affiliates of the Bank, and each of their respective successors and assigns, and (ii) all of the current and former shareholders, directors, officers, employees, attorneys, agents and representatives of the Bank and such affiliates, and their respective heirs, executors, successors and assigns (collectively, the Released Persons ), from any and all claims, demands, liabilities, actions and causes of action of any nature whatsoever, whether liquidated or unliquidated, known or unknown, matured or unmatured, fixed or contingent which any Credit Party had, has or may have had against any of the Released Persons arising out of or in any way relating to the Liabilities, any Collateral, any Loan Document or any document, dealing or other matter in connection with any Loan Document or any Collateral, in each case to the extent arising on or prior to the date hereof or out of, or relating to, actions, dealings or other matters occurring prior to the date hereof (including any action or omission of any Released Person prior to the date hereof), the negotiation and documentation of this Agreement, and any of the transactions made or contemplated to be made hereunder or thereunder (collectively the Released Claims ); provided, however, that the foregoing shall not effect a release of any obligations of the Bank arising under this Agreement. that (i) the release set forth in above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release; and (ii) no fact, event, circumstance, evidence or transaction which could now be asserted or which may hereafter be discovered shall affect in any manner the final and unconditional nature of such releases. that as of the date of this Agreement, it has not assigned, transferred or sold (or purported to assign, transfer or sell) all or any portion of any Released Claim. Each Guarantor hereby confirms and acknowledges: i. that each has read this Forbearance Agreement and consents to the terms hereof and further hereby confirms and agrees that, notwithstanding the effectiveness of this Forbearance Agreement, its obligations pursuant to the Loan Documents to which it is a party shall not be impaired or affected and all such Loan Documents are, and shall continue to be, in full force and effect and are hereby confirmed and ratified in all respects, subject however, to the Bank s agreement to forbear from exercising default-related remedies under the Loan Agreement against the Credit Parties, including, without limitation, each Guarantor, in accordance with the terms and conditions set forth herein. ii. that each is validly and justly indebted to the Bank for the payment of all of the obligations which it has guaranteed, without offset, defense, cause of action or counterclaim of any kind or nature whatsoever under the Loan Documents pursuant to the terms thereof. iii. reaffirms and admits the validity and enforceability of the Loan Documents to which each is a party and the liens on the Collateral which were granted by the Credit Parties, as applicable, pursuant to any of the Loan Documents or otherwise. 5. Reimbursement of Expenses. All costs or out-of-pocket expenses incurred by the Bank, including, without limitation, reasonable legal fees and expenses, in connection with the preparation and negotiation of this Agreement, or relating to any of the events or actions described in this Agreement shall constitute reimbursable expenses under the Loan Documents, shall be payable in accordance with this Agreement by the Credit Parties to the Bank, and shall constitute Liabilities secured by the Collateral until paid in full. In regard to the foregoing, each Credit Party acknowledges that the Bank, at its option, if such expenses are not fully paid when payment thereof is due as set forth herein, set off funds of such Credit Party on deposit with the Bank, and apply the proceeds derived therefrom to the payment of such then unpaid reimbursable expenses. 5

7 6. Successors and Assigns. This Agreement is binding upon, and inures to the benefit of, each Credit Party and the Bank and their respective successors and permitted assigns. This Agreement may not be assigned by any Credit Party without the prior written consent of the Bank. 7. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which shall constitute one and the same instrument. Each counterpart may be delivered by (as a pdf. attachment) or facsimile transmission, and an ed or faxed signature shall have the same force and effect as an original signature. 8. Time of Essence. Time is of the essence in the performance of this Agreement. 9. Entire Agreement. This Agreement embodies the entire understanding and agreement between the Parties with respect to the subject matter hereof and thereof, and supersedes all prior agreements, understandings and inducements, whether express or implied, oral or written, in regard to the subject matter hereof or thereof. 10. No Duress; Jointly Drafted. The Credit Parties are represented by counsel of its (and her/his) respective choice, are fully aware of the terms contained in this Agreement and have voluntarily and without coercion or duress of any kind entered into this Agreement. This Agreement shall be deemed to be jointly drafted, and no provision of it shall be interpreted or construed for or against any Party because such Party purportedly prepared or requested such provision, any other provision, or this Agreement as a whole. 11. Governing Law. This Agreement shall be governed by, and shall be construed and enforced in accordance with the law of the State of New York and shall be governed and interpreted on the same basis as the Loan Documents. 12. Trial By Jury. Each of the Parties hereto knowingly and irrevocably waives trial by jury in any action or proceeding with respect to this Agreement to the fullest extent allowed by law and on the same basis as the Loan Documents. 13. Severability. If any provision of this Agreement shall be declared or determined by any court to be invalid, illegal or unenforceable, the remainder of the provisions shall remain in full force and effect and shall in no way be affected or impaired thereby. 14. Effectiveness. This Agreement shall become effective upon the execution of a counterpart hereof by each of the Parties and the delivery thereof to the Parties. 15. Third Party Beneficiary. This Agreement does not and is not intended to confer any rights or remedies upon any person other than the Parties. 16. Headings. Section and subsection headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose or be given any substantive effect. 17. Amendments; Cumulative Remedies. This Agreement may not be modified, amended or supplemented, and the terms and conditions of this Agreement may not be waived, except by a written agreement executed by each Party. No failure to exercise and no delay in exercising on the part of the Bank of any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of any right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges under any other Loan Document or provided by law. 18. Survival. All representations, warranties, covenants, agreements, undertakings, waivers and releases of the Credit Parties contained herein shall be deemed to have been relied upon by the Bank 6

8 (notwithstanding any investigation heretofore or hereafter made by the Bank or on its behalf) and shall survive the expiration or termination of the Standstill Period. IN WITNESS WHEREOF, this Agreement has been duly executed by the Parties as of the dated first above written. YELLOW GROUP, LLC PATTON CORRIGAN TAXI MEDALLION MANAGEMENT, LLC MICHAEL LEVINE TAXI AFFILIATION SERVICES, LLC CL MEDALLION HOLDINGS, LLC YELLOW MEDALLION HOLDINGS, LLC YC1, LLC YC2, LLC YC18, LLC _ YC17, LLC YC19, LLC 7

9 YC20, LLC YC21, LLC YC22, LLC 8

10 Exhibit A SPECIFIED DEFAULTS 1. Maturity Default on December 1, Exceeded maximum leverage ratio of 3.5:1 at FYE 12/31/13 (actual: 3.72:1) 3. Failure to provide monthly borrowing base certificates from 10/14 to 3/15 4. Failure to provide Borrower quarterly financial statements for 3Q14 and 4Q14 9

11 Exhibit B REQUIRED FINANCIAL STATEMENTS AND REPORTS 1. Management prepared consolidated and consolidating financials of Yellow Group, LLC and its subsidiaries for the fiscal year ending December 31, 2013 and December 31, Federal Tax Returns for Yellow Group, LLC and its subsidiaries 3. Management prepared consolidated and consolidating quarterly financial statements of Yellow Group, LLC and its subsidiaries for the quarters ending September 31, 2014 and December 31, Monthly aging / operating reports from December 2014 through March 2015, including monthly operating reports showing activity related to Medallion Loan Accounts and Eligible Medallion Loans, and Eligible Medallion Loans that are aged 30, 60 and 90 days past due, loans receivable aging report, cash collections report, and accounts receivable aging report year-end Personal Financial Statements and 2014 Federal Tax Returns (within thirty days of filing or evidenced of filed extension) for Patton Corrigan and Michael Levine Federal Tax Returns for Corporate Guarantor s Yellow Medallion Holdings, LLC, CL Medallion Holdings, LLC, American United Taxi Affiliation Inc. and Transit Fuel Holdings, LLC & Subsidiaries 10