SECURITY AGREEMENT
Exhibit
10.91
THIS
SECURITY AGREEMENT (this “Security
Agreement”),
dated as of June
6,
2006, by and among U-Haul Leasing & Sales Co., a Nevada corporation, U-Haul
Co. of Arizona, an Arizona corporation and U-Haul International, Inc., a Nevada
corporation (collectively, the “Borrowers”),
Bayerische Hypo- und Vereinsbank AG, New York Branch, (with its successors,
indorsees, transferees and assigns, in such capacity, the “Administrative
Agent”),
on
behalf of Bayerische Hypo- und Vereinsbank AG, New York Branch and
other
lenders party to the Credit Agreement (as defined herein) from time to time
(each a “Lender”,
and
collectively, the “Lenders”)
and the
Hedge Provider.
RECITALS
A. Pursuant
to a Credit Agreement, dated as of June
6,
2006 (the “Credit
Agreement”),
among
the Borrowers, U-Haul International, Inc., as Servicer/Manager and Guarantor,
the Administrative Agent and the Lenders, the Lenders have agreed to extend
certain credit facilities to the Borrowers to finance the purchase of certain
new Vehicles (as defined below), upon the terms and subject to the conditions
set forth therein.
B. Each
Lender’s obligation to extend the credit facilities to the Borrowers under the
Credit Agreement is subject, and
the
Hedge Provider’s obligation to enter into any Hedge is subject, among other
conditions, to receipt by the Lenders and the Administrative Agent of this
Security Agreement, duly executed by the Borrowers.
AGREEMENT
NOW,
THEREFORE, in consideration of the above recitals and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the Borrowers hereby agree with the Administrative Agent and
the
Lenders as follows:
1. Definitions
and Interpretation.
(a) Definitions.
When
used in this Security Agreement, the following terms shall have the following
respective meanings:
“Account
Bank”
means,
as applicable, the Collection Account Bank or the Collection Sub-Account
Bank.
“Account
Debtor”
shall
have the meaning given to that term in subparagraph
3(g)
hereof.
“Borrowers”
shall
have the meaning given to that term in the introductory paragraph
hereof.
“Collateral”
shall
have the meaning given to that term in paragraph
2
hereof.
“Credit
Agreement”
shall
have the meaning given to that term in Recital
A
hereof.
“Dealer
List”
means
a
list in electronic format, delivered by or on behalf of the Borrowers to the
Administrative Agent as updated from time to time in accordance with Section
8.01(g) of the Credit Agreement.
“Equipment”
shall
have the meaning given to that term in Attachment
1
hereto.
“Xxxxxx
Provider”
means
HVB, as swap counterparty under the Hedge, or any other counterparty acceptable
to the Lenders.
“HVB”
shall
mean Bayerische Hypo- und Vereinsbank AG, New York Branch.
“Inventory”
shall
have the meaning given to that term in Attachment
1
hereto.
“Lenders”
shall
have the meaning given to that term in the introductory paragraph
hereof.
“Loan
Documents”
means
the Credit Agreement, the Note, the Guarantee Agreement, the Collection
Sub-Account Control Agreement, the Collection Account Control Agreement, the
Fee
Letter
the
Hedge Agreement and this Security Agreement.
“Proceeds”
means
all proceeds of, and all other profits, products, rentals or receipts, in
whatever form, arising from the collection, sale, lease, exchange, assignment,
licensing or other disposition of, or other realization upon, any Collateral,
including, without limitation, all claims of the Borrowers against third parties
for loss of, damage to or destruction of, or for proceeds payable under, or
unearned premiums with respect to, policies of insurance in respect of, any
Collateral, any payments with respect to a Warranty and all claims of the
Borrowers against the provider of any such Warranty, and any condemnation or
requisition payments with respect to any Collateral, in each case whether now
existing or hereafter arising, provided that, with respect to any Vehicle,
“Proceeds” shall not include any dealer commissions, licensing fees, maintenance
costs and insurance expenses owing under the Dealership Contracts.
“Receivables”
shall
have the meaning given to that term in Attachment
1
hereto.
“Secured
Obligations”
means
the obligations secured under this Security Agreement, including (a) all
principal of and interest (including, without limitation, any interest which
accrues after the commencement of any case, proceeding or other action relating
to the bankruptcy, insolvency or reorganization of any Borrower, whether or
not
allowed or allowable as a claim in any such case, proceeding or other action)
on
any Loan to the Borrowers under the Credit Agreement; (b) all other liabilities,
debts, obligations or amounts, howsoever arising, payable by the Borrowers
to
the Administrative Agent or the Lenders (whether evidenced by any note or
instrument and whether for the payment of money), direct or indirect, absolute
or contingent, due or to become due, now existing or hereafter arising, under
the Credit Agreement or under any other Loan Document, including without
limitation all interest, fees, charges, expenses, attorneys’ fees and
accountants’ fees chargeable to the Borrowers or payable by the Borrowers
thereunder; (c) any renewals or extensions of any of the foregoing; (d) all
obligations owing to the Hedge Provider pursuant to any Hedge Agreement and
(e)
all other obligations of the Borrowers or their Affiliates under any Loan
Document.
“UCC”
shall
mean the Uniform Commercial Code as in effect in the State of New York as of
the
date hereof.
“Vehicle”
shall
mean a new motor vehicle owned by any Borrower and constituting part of the
Borrowers’ fleet of rental assets as identified on the Vehicle Schedule
delivered by the Borrowers to the Administrative Agent and the Lenders under
the
Credit Agreement a copy of which is attached hereto as Attachment
4
(as the
same may be updated from time to time).
“Warranty”
shall
mean any warranty with respect to any Vehicle or any component parts thereof,
whether from the dealer, seller or manufacturer of such Vehicle or any third
party warranty provider, relating to the merchantability of such Vehicle or
parts or the life or performance of such Vehicle or parts and all available
remedies thereunder, including payment, replacement, repair, substitution or
other remedies.
(b) Other
Defined Terms.
Unless
otherwise defined herein, all other capitalized terms used herein and defined
in
the Credit Agreement shall have the respective meanings given to those terms
in
the Credit Agreement, and all terms defined in the UCC shall have the respective
meanings given to those terms in the UCC.
(c) Other
Interpretive Provisions.
The
rules of construction set forth in Section 1.02
of the
Credit Agreement shall, to the extent not inconsistent with the terms of this
Security Agreement, apply to this Security Agreement and are hereby incorporated
by reference.
2. Grant
of Security Interest.
As
security for the Secured Obligations, the Borrowers, jointly and severally,
hereby pledge and assign to the Administrative Agent and its successors,
indorsees, transferees and assigns, on behalf of the Lenders
and the
Hedge Provider, and grant to the Administrative Agent, on behalf of the
Lenders
and the
Hedge Provider a security interest in all right, title and interest of the
Borrowers in and to the property whether now owned or hereafter acquired
described in Attachment
1
hereto,
as such Attachment may be amended or supplemented from time to time after the
date hereof by a supplemental Vehicle Schedule delivered by the Borrowers to
the
Administrative Agent,
the
Lenders and the Xxxxxx Provider (collectively and severally, the “Collateral”),
which
Attachment
1
is
incorporated herein by this reference.
3. Representations
and Warranties.
The
Borrowers, jointly and severally, represent and warrant to the Administrative
Agent, on behalf of the Lenders
and the
Hedge Provider, as follows:
(a) Each
of
UHI and U-Haul Sales & Leasing Co. is a corporation duly authorized and
validly existing and in good standing under the laws of the State of Nevada.
U-Haul Co. of Arizona is a corporation duly authorized and validly existing
and
in good standing under the laws of the State of Arizona. Except as disclosed
on
Attachment
5,
none of
the Borrowers has (x) had any other corporate name during the past six years,
(y) changed its identity or corporate structure in any way within the past
six
years, or (z) used or operated under any other names (including trade names
or
other similar names) during the past six years. The exact corporate name of
each
Borrower as it appears on its certificate of incorporation, and location of
its
chief executive office are as follows:
(i) U-Haul
International, Inc., 0000 X. Xxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx
00000;
(ii) U-Haul
Co. of Arizona, 0000 X. Xxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx 00000; and
(iii) U-Haul
Leasing & Sales Co., 0000 Xxxxxxxxx Xxx, Xxxx, Xxxxxx 00000.
(b) The
Borrowers are the legal and beneficial owner of the Collateral (or, in the
case
of after-acquired Collateral, at the time the Borrowers acquire rights in the
Collateral, will be the legal and beneficial owner thereof). No other Person
has
(or, in the case of after-acquired Collateral, at the time a Borrower acquires
rights therein, will have) any right, title, claim or interest (by way of Lien,
purchase option or otherwise) in, against or to the Collateral, other than
Permitted Encumbrances.
(c) All
actions have been taken that are necessary under the UCC to perfect the
Administrative Agent's interest in the Collateral. All actions have been taken
that are necessary under applicable state vehicle titling and registration
law
to perfect the Borrowers’ interest in Vehicles constituting the
Collateral.
(d) The
Borrowers have not performed any acts which might prevent the Administrative
Agent or the Lenders from enforcing any of the terms of this Security Agreement
or which would limit the Administrative Agent or the Lenders in any such
enforcement. Other than financing statements or other similar or equivalent
documents or instruments with respect to the Security Interests and Permitted
Encumbrances, no financing statement, mortgage, security agreement or similar
or
equivalent document or instrument covering all or any part of the Collateral
is
on file or of record in any jurisdiction in which such filing or recording
would
be effective to perfect a Lien on such Collateral.
(e) The
Borrowers shall furnish to the Administrative Agent on or before the Closing
Date lien search reports or other evidence satisfactory to the Administrative
Agent that no liens prior to the lien of this Security Agreement shall exist
with respect to any Collateral.
(f) All
Equipment and Inventory are (i) located at the locations indicated in the most
recent Dealer List delivered to the Administrative Agent, and have been
consigned to the possession of a third-party dealer pursuant to the Dealership
Contracts, except when such Equipment and Inventory have been rented to
consumers in the ordinary course of the Borrowers’ business, as such list of
locations may be updated by the Borrowers from time to time at the request
of
the Administrative Agent, (ii) in transit to such locations or (iii) in transit
to a third party purchaser which will become obligated on a Receivable to a
Borrower upon receipt. Except for Equipment and Inventory referred to in the
preceding sentence, the Borrowers have exclusive possession and control of
the
Inventory and Equipment. All Equipment and Inventory has been acquired by the
Borrowers in the ordinary course of the Borrowers’ business.
(g) Each
Receivable is genuine and enforceable against the party obligated to pay such
Receivable (an “Account
Debtor”)
free
from any right of rescission, defense, setoff or discount. Each Receivable
was
originated in the ordinary course of the Borrowers’ business.
(h) Each
insurance policy maintained by the Borrowers in accordance with Section 8.07
of
the Credit Agreement is validly existing and is in full force and effect. The
Borrowers are not in default in any material respect under the provisions of
any
such insurance policy, and there are no facts which, with the giving of notice
or passage of time (or both), would result in such a default under any provision
of any such insurance policy. Set forth in Attachment
3
hereto
is a complete and accurate list of the insurance of the Borrowers in effect
on
the date of this Security Agreement required pursuant to Section 8.07 of the
Credit Agreement showing as of such date, (i) the type of insurance carried,
(ii) the name of the insurance carrier, and (iii) the amount of each type of
insurance carried.
(i) The
information set forth in each Dealer List delivered pursuant to Section 8.01(g)
of the Credit Agreement is true, correct and accurate.
4. Covenants.
The
Borrowers, jointly and severally, hereby agree as follows:
(a) The
Borrowers, at the Borrowers’ expense, shall promptly procure, execute and
deliver to the Administrative Agent all documents, instruments and agreements
and perform all acts which are necessary or desirable, or which the
Administrative Agent or the Lenders may request, to establish, maintain,
preserve, protect and perfect the Collateral, the Lien granted to the
Administrative Agent therein and the first priority of such Lien or to enable
the Administrative Agent to exercise and enforce its rights and remedies
hereunder with respect to any Collateral.
(b) The
Borrowers shall not use or permit any Collateral to be used in violation of
(i)
any provision of the Credit Agreement, this Security Agreement or any other
Loan
Document, (ii) any applicable Requirement of Law where such use might have
a
Material Adverse Effect, or (iii) any policy of insurance covering the
Collateral.
(c) The
Borrowers shall pay promptly when due all Taxes, all Liens and all other charges
now or hereafter imposed upon, relating to or affecting any
Collateral.
(d) Without
thirty (30) days’ prior written notice to the Administrative Agent and the
Lenders, no Borrower shall (i) change its jurisdiction of organization, or
the
office in which such Borrower’s books and records relating to Receivables or the
originals of Dealership Contracts or Rental Company Contracts are kept, (ii)
keep Collateral consisting of documents at any location other than the offices
of UHI or U-Haul Co. of Arizona at 0000 X. Xxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx
00000, or the offices of U-Haul Sales & Leasing Co. at 0000 Xxxxxxxxx Xxx,
Xxxx, Xxxxxx 00000, or (iii) keep Collateral consisting of Equipment, Inventory
or other goods at any location other than the locations permitted pursuant
to
Section 9.02 of the Credit Agreement.
(e) For
each
of the Collection Sub-Account and the Collection Account, UHI shall (i) execute
and deliver to the Account Bank a Collection Sub-Account Control Agreement
and a
Collection Account Control Agreement substantially in the form of Attachment
2
hereto
and (ii) cause the Account Bank to execute and deliver to the Administrative
Agent such account control agreements.
(f) Commencing
from the date hereof, the Borrowers shall make or cause to be made all deposits
required pursuant to Section 5.03 of the Credit Agreement, at the times so
required.
(g) The
Borrowers shall fully comply with any shifting control notice delivered pursuant
to the Collection Account Control Agreement.
(h) The
Borrowers shall appear in and defend any action or proceeding which may affect
its title to or the Administrative Agent's interest in the
Collateral.
(i) The
Borrowers shall keep separate, accurate and complete records of the Collateral
and shall provide the Administrative Agent with such records and such other
reports and information relating to the Collateral as the Administrative Agent
or each Lender may reasonably request from time to time.
(j) The
Borrowers shall not surrender or lose possession of (other than to the Lenders),
sell, encumber, lease, rent, option, or otherwise dispose of or transfer any
Collateral or right or interest therein except in the ordinary course of the
Borrowers’ business and as permitted in the Credit Agreement, and,
notwithstanding any provision of the Credit Agreement, the Borrowers shall
keep
the Collateral free of all Liens except Permitted Encumbrances.
(k) The
Borrowers shall collect, enforce and receive delivery of the Receivables in
accordance with past practice until otherwise notified by the Administrative
Agent.
(l) The
Borrowers shall comply with all material Requirements of Law applicable to
the
Borrowers which relate to the production, possession, operation, maintenance
and
control of the Collateral.
(m) The
Borrowers shall (i) maintain and keep in force public liability insurance of
the
types and in amounts customarily carried from time to time during the term
of
the Credit Agreement in its lines of business, such insurance to be carried
with
companies and in amounts satisfactory to the Administrative Agent, (ii) deliver
to the Administrative Agent from time to time, as the Administrative Agent
may
request, schedules setting forth all insurance then in effect or copies of
the
applicable policies, and (iii) deliver to the Administrative Agent copies of
each policy of insurance which replaces, or evidences the renewal of, each
existing policy of insurance at least fifteen (15) days prior to the expiration
of such policy. If required pursuant to Section 8.07 of the Credit Agreement,
the Administrative Agent shall be named as additional insured on all liability
insurance of the Borrowers with respect to any Collateral, and such policies
shall contain such additional endorsements as shall be required by the
Administrative Agent, including the endorsements specified in Attachment
3
hereto.
Prior to the occurrence and the continuance of an Event of Default, all proceeds
of any property insurance (whether maintained by any Borrower or a third party)
paid as a result of any event or occurrence shall be paid to the Borrowers.
All
proceeds of any property insurance (whether maintained by any Borrower or a
third party) paid after the occurrence and during the continuance of an Event
of
Default shall be paid to the Administrative Agent or the Collection Sub-Account
to be held as Collateral and applied as provided in the Credit Agreement or,
at
the election of the Administrative Agent, returned to the
Borrowers.
(n) The
Borrowers shall (i) promptly make any applicable claims under each applicable
Warranty and (ii) deliver to the Administrative Agent from time to time, as
the
Administrative Agent may request, schedules setting forth all Warranties then
in
effect or copies of such Warranties, together with a schedule of all Vehicles
covered by such Warranty. Prior to the occurrence and the continuance of an
Event of Default, all cash proceeds of any Warranty shall be paid to the
Borrowers. All cash proceeds of any Warranty paid after the occurrence and
during the continuance of an Event of Default shall be paid to the Lenders
or
the Collection Sub-Account to be held as Collateral and applied as provided
in
the Credit Agreement or, at the election of the Lenders, returned to the
Borrowers.
5. Authorized
Action by Administrative Agent.
The
Borrowers hereby irrevocably appoint the Administrative Agent as their
attorney-in-fact and agree that the Administrative Agent may perform (but the
Administrative Agent shall not be obligated to and shall incur no liability
to
the Borrowers or any third party for failure so to do) any act which the
Borrowers are obligated by this Security Agreement to perform, and to exercise
such rights and powers as Borrowers might exercise with respect to the
Collateral, including, without limitation, the right to (a) collect by legal
proceedings or otherwise and endorse, receive and receipt for all dividends,
interest, payments, proceeds and other sums and property now or hereafter
payable on or on account of the Collateral; (b) enter into any extension,
reorganization, deposit, merger, consolidation or other agreement pertaining
to,
or deposit, surrender, accept, hold or apply other property in exchange for
the
Collateral; (c) insure, process, preserve and enforce the Collateral; (d) make
any compromise or settlement, and take any action it deems advisable, with
respect to the Collateral; (e) pay any Indebtedness of any Borrower relating
to
the Collateral; (f) execute UCC financing statements and other documents,
instruments and agreements required hereunder; (g) note any Borrower’s lien on
certificates of title relating to the Collateral; provided,
however,
that
the Administrative Agent may exercise such powers only after the occurrence
and
during the continuance of an Event of Default. The Borrowers agree to reimburse
the Administrative Agent upon demand for all reasonable costs and expenses,
including attorneys’ fees, that the Administrative Agent may incur while acting
as the Borrowers’ attorney-in-fact hereunder, all of which costs and expenses
are included in the Secured Obligations. The Borrowers agree that such care
as
the Administrative Agent gives to the safekeeping of its own property of like
kind shall constitute reasonable care of the Collateral when in the
Administrative Agent’s possession; provided,
however,
that
Administrative Agent shall not be required to make any presentment, demand
or
protest, or give any notice and need not take any action to preserve any rights
against any prior party or any other Person in connection with the Secured
Obligations or with respect to the Collateral.
6. Default
and Remedies.
The
Borrowers shall be deemed in default under this Security Agreement upon the
occurrence and during the continuance of an Event of Default, as that term
is
defined in the Credit Agreement. In addition to all other rights and remedies
granted to the Lenders and the Administrative Agent by this Security Agreement,
the Credit Agreement, the other Loan Documents, the UCC and other applicable
Requirements of Law, the Administrative Agent may, upon the occurrence and
during the continuance of any Event of Default, exercise any one or more of
the
following rights and remedies: (a) collect, receive, appropriate or realize
upon
the Collateral or otherwise foreclose or enforce the Administrative Agent’s
security interests in any or all Collateral in any manner permitted by
applicable Requirements of Law or in this Security Agreement; (b) notify any
or
all Account Debtors to make payments on Receivables directly to the
Administrative Agent; (c) direct the Collection Account or the Collection
Sub-Account Bank to liquidate the account(s) maintained by it, pay all amounts
payable in connection therewith to the Administrative Agent and/or deliver
any
proceeds thereof to the Administrative Agent; (d) sell or otherwise dispose
of
any or all Collateral at one or more public or private sales, whether or not
such Collateral is present at the place of sale, for cash or credit or future
delivery, on such terms and in such manner as the Administrative Agent may
determine; (e) require the Borrowers to assemble the Collateral and make it
available to the Administrative Agent at a place to be designated by the
Administrative Agent; (f) enter onto any property where any Collateral is
located and take possession thereof with or without judicial process; and (g)
prior to the disposition of the Collateral, store, process, repair or
recondition any Collateral consisting of goods, perform any obligations and
enforce any rights of the Borrowers or their Subsidiaries under any Dealership
Contracts, any Rental Company Contracts or the Fleet Owner Agreement, or
otherwise prepare and preserve Collateral for disposition in any manner and
to
the extent the Administrative Agent deems appropriate. In furtherance of the
Administrative Agent's rights hereunder, the Borrowers hereby grant to the
Administrative Agent an irrevocable, non-exclusive license (exercisable without
royalty or other payment by the Lenders) to use, license or sublicense any
patent, trademark, tradename, copyright or other intellectual property in which
any Borrower now or hereafter has any right, title or interest, together with
the right of access to all media in which any of the foregoing may be recorded
or stored. In any case where notice of any sale or disposition of any Collateral
is required, the Borrowers hereby agree that seven (7) days notice of such
sale
or disposition is reasonable.
7. Miscellaneous.
(a) Notices.
Except
in the case of notices and other communications expressly permitted to be given
by telephone, all notices and other communications provided for herein shall
be
in writing and shall be delivered by hand or overnight courier service, mailed
by certified or registered mail or sent by telecopy, as follows:
(i) if
to any
Borrower, to it at 0000 Xxxxxxxxx Xxx, Xxxx, XX 00000-0000, Attention: Xxxxx
Xxxxxxx (Facsimile No. (000) 000-0000), with a copy to 0000 X. Xxxxxxx Xxxxxx,
Xxxxxxx, XX 00000, Attention: Xxxxxxxx Xxxxxxx (Facsimile No. (000) 000-0000);
(ii) if
to
HVB, in
its capacity as Lender or as Administrative Agent, to it at 000 Xxxx
00xx
Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxx Xxxxxxx/ Xxxxx Xxxxxx, (Facsimile
No.(000)
000-0000) with a copy to Xxx Xxxxxxxx (Facsimile No. (000) 000-0000);
and
(iii)
if
to any
other Lender (if any), to it at the address provided by such Lender pursuant
to
the Credit Agreement.
Any
party
hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices
and
other communications given to any party hereto in accordance with the provisions
of this Security Agreement shall be deemed to have been given on the date of
receipt.
(b) Waivers;
Amendments.
No
failure or delay by the Lenders or the Administrative Agent in exercising any
right or power hereunder or under any other Loan Document shall operate as
a
waiver thereof, nor shall any single or partial exercise of any such right
or
power, or any abandonment or discontinuance of steps to enforce such a right
or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of the Lenders and the
Administrative Agent hereunder and under the other Loan Documents are cumulative
and are not exclusive of any rights or remedies that they would otherwise have.
No waiver of any provision of any Loan Document or consent to any departure
by
any Loan Party therefrom shall in any event be effective unless the same shall
be permitted by paragraph (b) of this Section, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. Without limiting the generality of the foregoing, the making of a Loan
shall not be construed as a waiver of any Default, regardless of whether the
Lenders may have had notice or knowledge of such Default at the
time.
Neither
this Security Agreement nor any other Loan Document nor any provision hereof
or
thereof may be waived, amended or modified except, in the case of this Security
Agreement, pursuant to an agreement or agreements in writing entered into by
the
Borrowers, the Administrative Agent and the Lenders.
(c) Successors
and Assigns.
The
provisions of this Security Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that a Borrower may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent
of
the Administrative Agent and the Lenders (and any attempted assignment or
transfer by a Borrower without such consent shall be null and void). Nothing
in
this Security Agreement, expressed or implied, shall be construed to confer
upon
any Person (other than the parties hereto, their respective successors and
assigns permitted hereby and, to the extent expressly contemplated hereby,
the
Related Parties of each Lender) any legal or equitable right, remedy or claim
under or by reason of this Security Agreement.
(i) The
Administrative Agent may, without the consent of the Borrowers, assign all
or a
portion of its rights and obligations under this Security Agreement; and
(ii) The
Administrative Agent may at any time pledge or assign a security interest in
all
or any portion of its rights under this Security Agreement to secure obligations
of such Administrative Agent, including any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to
any
such pledge or assignment of a security interest; provided
that no
such pledge or assignment of a security interest shall release such
Administrative Agent from any of its obligations hereunder or substitute any
such pledgee or assignee for such Administrative Agent as a party
hereto.
(d) Severability.
Any
provision of this Security Agreement held to be invalid, illegal or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such invalidity, illegality or unenforceability without
affecting the validity, legality and enforceability of the remaining provisions
hereof; and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other
jurisdiction.
(e) Survival.
All
covenants, agreements, representations and warranties made by the Loan Parties
in the Loan Documents and in the certificates or other instruments delivered
in
connection with or pursuant to this Security Agreement or any other Loan
Document shall be considered to have been relied upon by the other parties
hereto and shall survive the execution and delivery of the Loan Documents and
the making of any Loans, regardless of any investigation made by any such other
party or on its behalf and notwithstanding that the Lenders or the
Administrative Agent may have had notice or knowledge of any Default or
incorrect representation or warranty at the time any credit is extended
hereunder, and shall continue in full force and effect as long as the principal
of or any accrued interest on any Loan or any fee or any other amount payable
under this Security Agreement is outstanding and unpaid and so long as the
Commitments have not expired or terminated. Notwithstanding any provision of
this Security Agreement or any other Loan Document or any exercise by the
Lenders or the Administrative Agent of any of its rights hereunder or thereunder
(including, without limitation, any right to collect or enforce any Collateral).
(f) Borrowers’
Continuing Liability.
Notwithstanding any provision of this Security Agreement or any other Loan
Document or any exercise by the Lenders or the Administrative Agent of any
of
its rights hereunder or thereunder (including, without limitation, any right
to
collect or enforce any Collateral), (i) the Borrowers and their Subsidiaries
shall remain liable to perform their obligations and duties in connection with
the Collateral (including, without limitation, the Fleet Owner Agreement, the
Rental Company Contracts, the Dealership Contracts and all other agreements
relating to the Collateral) and (ii) neither the Lenders nor the Administrative
Agent shall assume any liability to perform such obligations and duties or
to
enforce any of the Borrowers’ rights in connection with the Collateral
(including, without limitation, Fleet Owner Agreement, the Rental Company
Contracts, the Dealership Contracts and all other agreements relating to the
Collateral).
(g) Governing
Law.
THIS
SECURITY AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAW
OF THE STATE OF NEW YORK.
(i) Each
Borrower hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of the Supreme Court of the State
of
New York sitting in New York County and of the United States District Court
of
the Southern District of New York, and any appellate court from any thereof,
in
any action or proceeding arising out of or relating to any Loan Document, or
for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of
any
such action or proceeding may be heard and determined in such New York State
or,
to the extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall
be
conclusive and may be enforced in other jurisdictions by suit on the judgment
or
in any other manner provided by law. Nothing in this Security Agreement or
any
other Loan Document shall affect any right that each Lender or the
Administrative Agent may otherwise have to bring any action or proceeding
relating to this Security Agreement or any other Loan Document against any
Borrower or its properties in the courts of any jurisdiction.
(ii) Each
Borrower hereby irrevocably and unconditionally waives, to the fullest extent
it
may legally and effectively do so, any objection which it may now or hereafter
have to the laying of venue of any suit, action or proceeding arising out of
or
relating to this Security Agreement or any other Loan Document in any court
referred to in subparagraph (g)(i) of this Section. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in
any
such court.
(iii) Each
Borrower hereby irrevocably agrees that service of process in any such action
or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to such
Borrower at its address set forth in Section 7(a) or at such other address
of
which the Administrative Agent and the Lenders shall have been notified pursuant
thereto. Nothing in this Security Agreement or any other Loan Document will
affect the right of any party to this Security Agreement to serve process in
any
other manner permitted by law.
(h) WAIVER
OF JURY TRIAL.
EACH
PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO THIS SECURITY AGREEMENT, ANY OTHER
LOAN
DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT,
TORT OR ANY OTHER THEORY). THE BORROWER CERTIFIES THAT NO REPRESENTATIVE, AGENT
OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER.
(i) Headings.
Section
and subsection headings used herein are for convenience of reference only,
are
not part of this Security Agreement and shall not affect the construction of,
or
be taken into consideration in interpreting, this Security
Agreement.
(j) Joint
and Several Liability of Borrowers.
Each
Borrower acknowledges and agrees that, whether or not specifically indicated
as
such in a Loan Document, all Secured Obligations shall be joint and several
Secured Obligations of each individual Borrower, and in furtherance of such
joint and several Secured Obligations, each Borrower hereby irrevocably and
unconditionally guarantees the payment of all Secured Obligations of each other
Borrower. Each Borrower hereby acknowledges and agrees that such Borrower shall
be jointly and severally liable to the Lenders and the Administrative Agent
for
all representations, warranties, covenants and, obligations and indemnities
of
the Borrowers hereunder.
(k) Third
Party Beneficiary.
Each
Borrower acknowledges and agrees that each Lender is an intended beneficiary
of
this Security Agreement.
[Signature
Page Follows]
1
IN
WITNESS WHEREOF, the Borrowers have caused this Security Agreement to be
executed as of the day and year first above written.
U-HAUL
LEASING & SALES CO.
By:
Name:
Title:
U-HAUL
CO. OF ARIZONA
By:
Name:
Title:
U-HAUL
INTERNATIONAL, INC.
By:
Name:
Title:
BAYERISCHE
HYPO- UND VEREINSBANK AG, NEW YORK BRANCH, as Administrative Agent
By:
Name:
Title:
By:
Name:
Title:
[Signature
Page for Security Agreement]
ATTACHMENT
1
To
Security Agreement
COLLATERAL
DESCRIPTION
All
right, title and interest of the Borrowers, whether now owned or hereafter
acquired, in and to the following:
(a) All
equipment as defined in the UCC listed on the accompanying Vehicle Schedule,
as
the same may be updated from time to time pursuant to the Credit Agreement,
including, without limitation, all Vehicles, together with all additions and
accessions thereto and replacements therefor (collectively, the “Equipment”);
(b) All
inventory as defined in the UCC listed on the accompanying Vehicle Schedule,
as
the same may be updated from time to time pursuant to the Credit Agreement,
including, without limitation, all Vehicles, together with all additions and
accessions thereto, replacements therefor, products thereof and documents
therefor (collectively, the “Inventory”);
(c) All
amounts receivable with respect to Fleet Owner Cash Flows and with respect
to
sales of Vehicles to third parties (the “Receivables”);
(d) The
Dealership Contracts, the Rental Company Contracts, the Fleet Owner
Agreement
in each
case to the extent the rights under such agreements relate to any Vehicle
constituting Equipment, and any Warranty;
(e) The
Collection Account, and all cash on deposited therein from time to
time;
(f) The
Collection Sub-Account, and all cash deposited therein from time to time;
(g) All
payments owing to the Borrowers with respect to a Hedge; and
All
Proceeds of the foregoing (including, without limitation, whatever is receivable
or received when Collateral or proceeds is sold, collected, exchanged, returned,
substituted or otherwise disposed of, whether such disposition is voluntary
or
involuntary, including rights to payment and return premiums and insurance
proceeds under insurance with respect to any Collateral, and all rights to
payment with respect to any cause of action affecting or relating to the
Collateral).
[1]-
ATTACHMENT
2
To
Security Agreement
FORM
OF
COLLECTION
ACCOUNT CONTROL AGREEMENT
AND
COLLECTION SUB- ACCOUNT CONTROL AGREEMENT
[2]-
ATTACHMENT
3
To
Security Agreement
INSURANCE
AND
INSURANCE
ENDORSEMENTS
If
required pursuant to Section 8.07 of the Credit Agreement, each of the liability
insurance policies of the Borrowers shall contain substantially the following
endorsements:
(a) Bayerische
Hypo- und Vereinsbank AG, New York Branch (the “Administrative
Agent”)
shall
be named as additional insured.
(b) In
respect of the interests of the Administrative Agent in the policies, the
insurance shall not be invalidated by any action or by inaction of any Borrower
or by any Person having temporary possession of the property covered thereby
(the “Property”)
while
under contract with any Borrower to perform maintenance, repair, alteration
or
similar work on the Property, and shall insure the interests of the
Administrative Agent regardless of any breach or violation of any warranty,
declaration or condition contained in the insurance policy by any Borrower
or
the Administrative Agent or any other additional insured (other than by such
additional insured, as to such additional insured) or by any Person having
temporary possession of the Property while under contract with any Borrower
to
perform maintenance, repair, alteration or similar work on the
Property.
(c) If
the
insurance policy is cancelled for any reason whatsoever, or substantial change
is made in the coverage that affects the interests of the Administrative Agent,
or if the insurance coverage is allowed to lapse for non-payment of premium,
such cancellation, change or lapse shall not be effective as to the
Administrative Agent for 30 days (or 10 days in the case of non-payment of
premium) after receipt by the Administrative Agent of written notice from the
insurer of such cancellation, change or lapse.
(d) The
Administrative Agent shall not have any obligation or liability for premiums,
commissions, assessments, or calls in connection with the
insurance.
(e) The
insurer shall waive any rights of set-off or counterclaim or any other
deduction, whether by attachment or otherwise, that it may have against the
Administrative Agent.
(f) The
insurance shall be primary without right of contribution from any other
insurance that may be carried by the Administrative Agent with respect to its
interests in the Property.
(g) The
insurer shall waive any right of subrogation against the Administrative
Agent.
(h) All
provisions of the insurance, except the limits of liability, shall operate
in
the same manner as if there were a separate policy covering each insured
party.
[3]-
ATTACHMENT
4
To
Security Agreement
VEHICLE
SCHEDULE
[On
file
with HVB]
[4]-
ATTACHMENT
5
To
Security Agreement
SCHEDULE
OF PRIOR NAMES, TRADE NAMES, PRIOR CORPORATE
STRUCTURES,
ETC.
|
COMPANY
|
FORMER
NAMES
(1998
- Present)
|
CHANGES
TO CORPORATE STRUCTURE
(1998
- Present)
|
FICTITIOUS
NAMES
(1998
- Present)
|
|
U-Haul
International, Inc.
|
None
|
None
|
None
|
|
U-Haul
Leasing & Sales Co.
|
None
|
None
|
None
|
|
U-Haul
Co. of Arizona
|
None
|
None
|
U-Haul
Co. of Southern Arizona
U-Haul
Co. of Western Arizona
U-Haul
Co. of Eastern Arizona
|
[5]-
