Execution Copy
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LOAN AND SECURITY AGREEMENT
BY AND AMONG
AMERCO,
A NEVADA CORPORATION
AND
EACH OF ITS SUBSIDIARIES THAT ARE SIGNATORIES HERETO,
AS BORROWERS,
THE LENDERS THAT ARE SIGNATORIES HERETO,
AS THE LENDERS,
AND
XXXXX FARGO FOOTHILL, INC.
AS THE LEAD ARRANGER,
ADMINISTRATIVE AGENT, SYNDICATION AGENT AND COLLATERAL AGENT
DATED AS OF MARCH 1, 2004
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LOAN AND SECURITY AGREEMENT
THIS LOAN AND SECURITY AGREEMENT (this "Agreement"), is
entered into as of March 1, 2004, between and among, on the one hand, the
lenders identified on the signature pages hereof (such lenders, together with
their respective successors and assigns, are referred to hereinafter each
individually as a "Lender" and collectively as the "Lenders"), XXXXX FARGO
FOOTHILL, INC., a California corporation, as the lead arranger, administrative
agent, syndication agent and collateral agent for the Lenders ("Agent") and, on
the other hand, AMERCO, a Nevada corporation ("Parent"), and each of Parent's
Subsidiaries identified on the signature pages hereof (such Subsidiaries,
together with Parent, are referred to hereinafter each individually as a
"Borrower," and individually and collectively, jointly and severally, as
"Borrowers").
RECITALS
WHEREAS, Parent and its wholly-owned subsidiary Amerco Real
Estate Company, a Nevada corporation ("AREC") (together with Parent,
collectively the "Debtors", and each individually a "Debtor"), are reorganized
debtors in jointly administered Case No. BK-03-52103-GWZ (the "Chapter 11 Case")
in the United States Bankruptcy Court for the District of Nevada (the "Court");
and
WHEREAS, the Debtors are parties to that certain Senior
Secured, Super-Priority Debtor-in-Possession Loan and Security Agreement dated
as of August 15, 2003 among the Debtors, Xxxxx Fargo Foothill, Inc., as agent,
and the various lenders party thereto (the "DIP Lenders") (as amended, restated,
supplemented or otherwise modified from time to time prior to the date hereof,
the "DIP Loan Agreement") and pursuant to which the DIP Lenders provided the
Debtors with financing for the Chapter 11 Case; and
WHEREAS, the Debtors have filed that certain Joint Plan of
Reorganization and that certain Disclosure Statement Concerning the Debtors'
First Amended Joint Plan of Reorganization under Chapter 11 of the United States
Bankruptcy Code, each dated as of November 26, 2003 (together with any amendment
or modifications thereto consented to by the Required Lenders as defined herein,
collectively, the "Reorganization Plan"); and
WHEREAS, the Reorganization Plan was confirmed pursuant to
that certain Order Confirming First Amended Joint Plan of Reorganization entered
by the Court in the Chapter 11 Case on February 20, 2004 (the "Confirmation
Order"), after a final hearing under Bankruptcy Rule 3020, which Confirmation
Order is reasonably satisfactory in form and substance to Agent and the Required
Lenders (as defined herein), and
WHEREAS, as set forth in the Reorganization Plan and
Confirmation Order, the Debtors have requested that Agent and the Lenders
provide the Debtors and the other Borrowers with financing for the
implementation of the Reorganization Plan and other general corporate purposes;
and
WHEREAS, Agent and the Lenders are willing to provide such
financing to Borrowers in accordance with and subject to the terms and
conditions set forth in this Agreement:
AGREEMENT
NOW, THEREFORE, in consideration of the agreements, provisions
and covenants set forth herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Borrowers, Agent and
the Lenders do hereby agree as follows:
1. DEFINITIONS AND CONSTRUCTION.
1.1 DEFINITIONS. As used in this Agreement, the following terms
shall have the following definitions:
"Account Debtor" means any Person who is or who may become
obligated under, with respect to, or on account of, an Account, Chattel Paper,
or a General Intangible.
"Accounts" means any Person's now owned or hereafter acquired
right, title, and interest with respect to "accounts" as such term is defined in
the Code, and any and all Supporting Obligations in respect thereof.
"ACH Transactions" means any cash management or related
services (including the Automated Clearing House processing of electronic funds
transfers through the direct Federal Reserve Fedline system) provided by a Bank
Product Provider for the account of Administrative Borrower or its Subsidiaries.
"Additional Documents" has the meaning set forth in Section
4.4.
"Administrative Borrower" has the meaning set forth in Section
17.9.
"Advances" has the meaning set forth in Section 2.1.
"Affiliate" means, as applied to any Person, any other Person
who, directly or indirectly, controls, is controlled by, or is under common
control with, such Person. For purposes of this definition, "control" means the
possession, directly or indirectly, of the power to direct the management and
policies of a Person, whether through the ownership of Stock, by contract, or
otherwise; provided, however, that, for purposes of Section 7.14 hereof: (a) any
Person which owns directly or indirectly 10% or more of the securities having
ordinary voting power for the election of directors or other members of the
governing body of a Person or 10% or more of the partnership or other ownership
interests of a Person (other than as a limited partner of such Person) shall be
deemed to control such Person, (b) each director (or comparable manager) of a
Person shall be deemed to be an Affiliate of such Person, and (c) each
partnership or joint venture in which a Person is a partner or joint venturer
shall be deemed to be an Affiliate of such Person. For the avoidance of doubt,
SAC Holding shall not be deemed to be an Affiliate of Borrowers for purposes of
this Agreement.
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"Affiliate Contracts" means each of the agreements set forth
on Schedule A-1 which shall include any agreement to which any Loan Party is a
party, on the one hand, and any Affiliate of such Loan Party is a party, on the
other hand, as such agreements are in place as of the Closing Date.
"Agency Letter" means that certain letter agreement executed
and delivered by Xxxxxxx Xxxxxx, Xxxx Xxxxxx (or any other person acceptable to
Agent from time to time having similar employee responsibilities) and Agent, as
amended, modified or replaced from time to time, the form and substance of which
are reasonably satisfactory to Agent.
"Agent" means Foothill, solely in its capacity as
administrative agent and collateral agent for the Lenders hereunder, and any
successor thereto.
"Agent Advances" has the meaning set forth in Section
2.3(e)(i).
"Agent's Account" means the account identified on Schedule
A-2.
"Agent's Liens" means the Liens granted by Borrowers and
Guarantors to Agent under this Agreement or the other Loan Documents.
"Agent-Related Persons" means Agent, together with its
Affiliates, officers, directors, employees, and agents.
"Agreement" has the meaning set forth in the preamble hereto.
"Agreement to Indemnify" means that certain agreement to
indemnify entered into by Parent in connection with the execution of the SAC
Participation and Subordination Agreement.
"Anti-Terrorism Laws" means any laws relating to terrorism or
money laundering, including Executive Order No. 13224 and the USA Patriot Act.
"Applicable Laws" means, with respect to any Person, those
laws, rules, regulations, statutes and ordinances that apply to that Person or
its business, undertaking, property or securities.
"Applicable Margin" means, as of any date of determination,
(a) if the relevant Obligation is a Term Loan that is a Base Rate Loan, 1.50%,
(b) if the relevant Obligation is a Term Loan that is a LIBOR Rate Loan, 4.00%,
or (c) for all other relevant Obligations, the applicable percentage indicated
below that corresponds to the Consolidated EBITDA for the 12-month period ended
immediately prior to the date of determination:
Applicable Applicable Margin Applicable
Consolidated EBITDA Margin for for Advances that Margin for
as of the end of each Advances that are are LIBOR Rate Letter of Credit
Pricing Level fiscal quarter Base Rate Loans Loans Fee
------------- -------------------------- ----------------- ----------------- ----------------
Level I Less than or equal to 1.50% 4.00% 4.00%
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Applicable Applicable Margin Applicable
Consolidated EBITDA Margin for for Advances that Margin for
as of the end of each Advances that are are LIBOR Rate Letter of Credit
Pricing Level fiscal quarter Base Rate Loans Loans Fee
------------- -------------------------- ----------------- ----------------- ----------------
$275,000,000
Level II Greater than $275,000,000, 1.25% 3.75% 3.75%
but less than or equal to
$300,000,000
Level III Greater than $300,000,000 1.00% 3.50% 3.50%
The Applicable Margin for each Advance and the Letter of Credit Fee shall be
determined as of the end of each fiscal quarter by reference to the Consolidated
EBITDA for the 12-month period then ending; provided, however, that (a) no
change in the Applicable Margin shall be effective until 3 Business Days after
the date on which Agent receives financial statements pursuant to Section
6.3(a), and a certificate of the chief financial officer of Parent demonstrating
such amount, attaching thereto a schedule in form reasonably satisfactory to
Agent of the computations used by Parent in determining such Consolidated EBITDA
for such preceding 12 month period ending as of the end of the most recently
ended fiscal quarter, and (b) the Applicable Margin shall be the interest rate
margin set forth for Level I above with respect to the applicable Advances and
Letter of Credit Fee, respectively, (i) from the Closing Date through and
including the second Business Day after Agent receives the information required
by clause (a) of this proviso for the fiscal quarter ending September 30, 2004,
(ii) if Parent has not submitted to Agent the information described in clause
(a) of this proviso as and when required under Section 6.3(a), for so long as
such information has not been received by Agent, and (iii) at the election of
Agent or the Required Lenders, upon the occurrence and during the continuation
of any Event of Default (whether or not the Default Rate of interest shall then
be in effect).
"Applicable Prepayment Premium" means, as of any date of
determination, an amount equal to (a) during the period of time from and after
the date of the execution and delivery of this Agreement up to (but excluding)
the date that is the first anniversary of the Closing Date, 2.00% times the sum
of (i) the Maximum Revolver Amount, plus (ii) the outstanding principal balance
of the Term Loan on the date immediately prior to the date of determination, (b)
during the period of time from and including the date that is the first
anniversary of the Closing Date up to (but excluding) the date that is the
second anniversary of the Closing Date, 1.50% times the sum of (i) the Maximum
Revolver Amount, plus (ii) the outstanding principal balance of the Term Loan on
the date immediately prior to the date of determination, and (c) during the
period of time from and including the date that is the second anniversary of the
Closing Date up to (and including) the date that is the third anniversary of the
Closing Date, 1.00% times the sum of (i) the Maximum Revolver Amount, plus (ii)
the outstanding principal balance of the Term Loan on the date immediately prior
to the date of determination. For the avoidance of doubt, the Applicable
Prepayment Premium shall be 0% after the date that is the third anniversary of
the Closing Date.
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"AREC" has the meaning set forth in the recitals of this
Agreement.
"Assignee" has the meaning set forth in Section 14.1.
"Assignment and Acceptance" means an Assignment and Acceptance
Agreement in the form of Exhibit A-1, or otherwise acceptable to Agent in its
Permitted Discretion.
"Authorized Person" means any officer or employee of
Administrative Borrower.
"Availability" means, as of any date of determination, if such
date is a Business Day, and determined at the close of business on the
immediately preceding Business Day, if such date of determination is not a
Business Day, the amount that Borrowers are entitled to borrow as Advances under
Section 2.1 (after giving effect to all then outstanding Obligations (other than
Bank Product Obligations) and all sublimits and reserves applicable under this
Agreement).
"Bank Product" means any financial accommodation extended to
Administrative Borrower or its Subsidiaries by a Bank Product Provider (other
than pursuant to this Agreement) including: (a) credit cards, (b) credit card
processing services, (c) debit cards, (d) purchase cards, (e) ACH Transactions,
(f) cash management, including controlled disbursement, accounts or services, or
(g) transactions under Hedge Agreements.
"Bank Product Agreements" means those agreements entered into
from time to time by Administrative Borrower or its Subsidiaries with a Bank
Product Provider in connection with the obtaining of any of the Bank Products.
"Bank Product Obligations" means all obligations, liabilities,
contingent reimbursement obligations, fees, and expenses owing by Administrative
Borrower or its Subsidiaries to any Bank Product Provider pursuant to or
evidenced by the Bank Product Agreements and irrespective of whether for the
payment of money, whether direct or indirect, absolute or contingent, due or to
become due, now existing or hereafter arising, and including all such amounts
that Administrative Borrower or its Subsidiaries are obligated to reimburse to
Agent or any member of the Lender Group as a result of Agent or such member of
the Lender Group purchasing participations from, or executing indemnities or
reimbursement obligations to, a Bank Product Provider with respect to the Bank
Products provided by such Bank Product Provider to Administrative Borrower or
its Subsidiaries.
"Bank Product Provider" means Xxxxx Fargo or any of its
Affiliates.
"Bank Product Reserves" means, as of any date of
determination, the amount of reserves that Agent has established (based upon the
Bank Product Providers' reasonable determination of the credit exposure in
respect of then extant Bank Products) for Bank Products then provided or
outstanding.
"Bankruptcy Code" means Title 11 of the United States Code,
provided that when the context so requires, with respect to the Canadian
Subsidiaries, "Bankruptcy Code" shall mean the Bankruptcy and Insolvency Act
(Canada) or the Companies' Creditors Arrangement Act (Canada), in any case, as
in effect from time to time.
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"Base LIBOR Rate" means the rate per annum, determined by
Agent in accordance with its customary procedures, and utilizing such electronic
or other quotation sources as it considers appropriate (rounded upwards, if
necessary, to the next 1/100%), to be the rate at which Dollar deposits (for
delivery on the first day of the requested Interest Period) are offered to major
banks in the London interbank market on or about 11:00 a.m. (California time) 2
Business Days prior to the commencement of the applicable Interest Period, for a
term and in an amount comparable to the Interest Period and amount of the LIBOR
Rate Loan requested (whether as an initial LIBOR Rate Loan or as a conversion of
a Base Rate Loan to a LIBOR Rate Loan) by Administrative Borrower in accordance
with this Agreement, which determination shall be conclusive in the absence of
manifest error.
"Base Rate" means, the rate of interest announced within Xxxxx
Fargo at its principal office in San Francisco as its "prime rate", with the
understanding that the "prime rate" is one of Xxxxx Fargo's base rates (not
necessarily the lowest of such rates) and serves as the basis upon which
effective rates of interest are calculated for those loans making reference
thereto and is evidenced by the recording thereof after its announcement in such
internal publications as Xxxxx Fargo may designate.
"Base Rate Loan" means each portion of an Advance or the Term
Loan that bears interest at a rate determined by reference to the Base Rate.
"Benefit Plan" means a "defined benefit plan" (as defined in
Section 3(35) of ERISA) for which any Borrower or any Subsidiary or ERISA
Affiliate of any Borrower has been an "employer" (as defined in Section 3(5) of
ERISA) within the past 6 years.
"Blocked Person" has the meaning set forth in Section 5.26(b).
"Board of Directors" means the board of directors (or
comparable managers) of Parent or any committee thereof duly authorized to act
on behalf thereof.
"Books" means any Person's now owned or hereafter acquired
books and records (including all of its Records indicating, summarizing, or
evidencing its assets (including the Collateral) or liabilities, all of any
Person's Records relating to its or their business operations or financial
condition, and all of its goods or General Intangibles related to such
information).
"Borrower" and "Borrowers" have the respective meanings set
forth in the preamble to this Agreement.
"Borrowing" means a borrowing hereunder consisting of Advances
(or term loans, in the case of the Term Loan) made on the same day by the
Lenders (or Agent on behalf thereof), or by Swing Lender in the case of a Swing
Loan, or by Agent in the case of an Agent Advance, in each case, to
Administrative Borrower.
"Borrowing Base" means, as of any date of determination, the
result of:
(a) 60.0% of the Fair Market Valuation, minus
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(b) the sum of (i) the Bank Product Reserves, (ii) the
Environmental Remediation Reserve, (iii) the Title
Reserve and (iv) the aggregate amount of other
reserves, if any, established by Agent under Section
2.1(b).
"Borrowing Base Certificate" means a certificate in the form
of Exhibit B-1 delivered by the chief financial officer of Parent to Agent.
"Business Day" means any day that is not a Saturday, Sunday,
or other day on which banks are authorized or required to close in the State of
California, except that, if a determination of a Business Day shall relate to a
LIBOR Rate Loan, the term "Business Day" also shall exclude any day on which
banks are closed for dealings in Dollar deposits in the London interbank market.
"Canadian Income Tax Act" means the Income Tax Act (Canada),
R.S.C. 1985 C.1 (5th Supp.), as amended from time to time.
"Canadian Subsidiaries" means, collectively, U-Haul (Canada)
and U-Haul Inspections Ltd., a British Columbia corporation.
"Capital Expenditures" means, with respect to any Person for
any period, gross expenditures that are capital expenditures as determined in
accordance with GAAP for such period, whether such expenditures are paid in cash
or financed; minus lease funding received pursuant to operating and Capital
Lease commitments for such period; minus Net Dispositions for such period;
provided, however, Net Dispositions from the WP Xxxxx Transaction received after
the Closing Date but on or prior to March 31, 2004 shall be deemed received
during fiscal year 2005.
"Capital Lease" means a lease that is required to be
capitalized for financial reporting purposes in accordance with GAAP.
"Capitalized Lease Obligation" means that portion of the
obligations under a Capital Lease that is required to be capitalized in
accordance with GAAP.
"Cash Equivalents" means (a) marketable direct obligations
issued or unconditionally guaranteed by the United States or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within 1 year from the date of acquisition thereof, (b)
marketable direct obligations issued by any state of the United States or any
political subdivision of any such state or any public instrumentality thereof
maturing within 1 year from the date of acquisition thereof and, at the time of
acquisition, having one of the two highest ratings obtainable from either
Standard & Poor's Rating Group ("S&P") or Xxxxx'x Investors Service, Inc.
("Moody's"), (c) commercial paper maturing no more than 270 days from the date
of creation thereof and, at the time of acquisition, having a rating of at least
A-1 from S&P or at least P-1 from Moody's, (d) certificates of deposit or
bankers' acceptances maturing within 1 year from the date of acquisition thereof
issued by any bank organized under the laws of the United States or any state
thereof having at the date of acquisition thereof combined capital and surplus
of not less than $250,000,000, (e) demand Deposit Accounts maintained with any
bank organized under the laws of the United States or any state thereof so long
as the amount maintained with any individual bank is less than or equal to
$100,000 and is insured by the
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Federal Deposit Insurance Corporation, and (f) Investments in money market funds
substantially all of whose assets are invested in the types of assets described
in clauses (a) through (e) above.
"Cash Management Account" has the meaning set forth in Section
2.7(a).
"Cash Management Agreements" means those certain cash
management agreements, in form and substance satisfactory to Agent, including
without limitation the cash management agreement with respect to the
Concentration Account, each of which is among Administrative Borrower or one of
its Subsidiaries, Agent, and one of the Cash Management Banks.
"Cash Management Bank" has the meaning set forth in Section
2.7(a).
"Certificate(s) of Title" has the meaning set forth in Section
5.25(a).
"Change of Control" means (a) any "person" or "group" (within
the meaning of Sections 13(d) and 14(d) of the Exchange Act), other than
Permitted Holders, that becomes the beneficial owner (as defined in Rules 13d-3
and 13d-5 under the Exchange Act), directly or indirectly, of 30%, or more, of
the Stock of Parent having the right to vote for the election of members of the
Board of Directors, or (b) a majority of the members of the Board of Directors
do not constitute Continuing Directors, or (c) any Borrower ceases to own,
directly or indirectly, and control 100% of the outstanding capital Stock of any
of its Subsidiaries extant as of the Closing Date unless the disposition,
liquidation or merger of such Subsidiary was permitted by Section 7.3 hereof; or
(d) (i) all or substantially all of the assets of Parent and its Restricted
Subsidiaries (as defined in the New AMERCO Note Indenture) are sold or otherwise
transferred to any Person other than a Wholly-Owned Restricted Subsidiary (as
defined in the New AMERCO Note Indenture) that is a Loan Party or (ii) Parent
consolidates or merges with or into another Person or any Person consolidates or
merges with or into Parent, in either case under this clause (d), in one
transaction or a series of related transactions in which immediately after the
consummation thereof Persons owning voting stock representing in the aggregate a
majority of the total voting power of the voting stock of Parent immediately
prior to such consummation do not own voting stock representing a majority of
the total voting power of the voting stock of Parent or the surviving or
transferee Person; or (e) Parent shall adopt a plan of liquidation or plan of
dissolution or any such plan shall be approved by the stockholders of Parent.
"Chapter 11 Case" has the meaning set forth in the preamble of
this Agreement.
"Chattel Paper" means any Person's now owned or hereafter
acquired right, title and interest in respect of "chattel paper" as such term is
defined in the Code, including, without limitation, any tangible or electronic
chattel paper.
"Closing Date" means the date of the making of the initial
Advance and Term Loan (or other extension of credit) hereunder.
"Closing Date Business Plan" means the set of Projections of
Borrowers for the 3-year period following the Closing Date (on a year-by-year
basis, and for the 1-year period following the Closing Date, on a month-by-month
basis), in form and substance (including as to scope and underlying assumptions)
reasonably satisfactory to Agent in its Permitted Discretion.
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"Code" means the New York Uniform Commercial Code, as in
effect from time to time.
"Collateral" means all of each Borrower's and each Guarantor's
now owned or hereafter acquired right, title, and interest in and to each of the
following:
(a) Accounts,
(b) Books,
(c) Chattel Paper,
(d) Commercial Tort Claims,
(e) Deposit Accounts,
(f) Equipment,
(g) General Intangibles,
(h) Inventory,
(i) Investment Property,
(j) Negotiable Collateral,
(k) Real Property Collateral,
(l) Supporting Obligations,
(m) money, cash, Cash Equivalents, or other assets of
each such Borrower or such Guarantor that now or hereafter come into the
possession, custody, or control of any member of the Lender Group,
(n) the proceeds and products, whether tangible or
intangible, of any of the foregoing, including proceeds of insurance covering
any or all of the foregoing, and any and all Accounts, Books, Chattel Paper,
Deposit Accounts, Equipment, General Intangibles, Inventory, Investment
Property, Negotiable Collateral, Real Property, Supporting Obligations, money,
deposit accounts, or other tangible or intangible property resulting from the
sale, exchange, collection, or other disposition of any of the foregoing, or any
portion thereof or interest therein, and the proceeds thereof; and
(o) to the extent not included in the foregoing, all
other personal property of Borrowers or Guarantors of any kind or description
(including, without limitation, with respect to either Canadian Guarantor, all
"personal property" (as defined in the PPSA) of such party and all "proceeds"
(as defined in the PPSA) thereof);
provided, however, that the Excluded Assets shall not be included in the
Collateral.
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"Collateral Access Agreement" means a landlord waiver, bailee
waiver, mortgagee waiver, or acknowledgement of any lessor, warehouseman,
processor, mortgagee, assignee, or other Person in possession of, having a Lien
upon, or having rights or interests in, the Equipment or Inventory, in each case
in form and substance reasonably satisfactory to Agent.
"Collections" means all cash, checks, notes, instruments, and
other items of payment (including insurance proceeds, proceeds of cash sales,
rental proceeds, and tax refunds) of Borrowers.
"Commercial Tort Claims" means any Person's now owned or
hereafter acquired right, title and interest with respect to any "commercial
tort claim" as such term is defined in the Code, including, without limitation,
the PWC Litigation and other commercial tort claims listed on Schedule C-1.
"Commitment" means, with respect to each Lender, its Revolver
Commitment, its Term Loan Commitment or its Total Commitment, as the context
requires, and, with respect to all Lenders, their Revolver Commitments, their
Term Loan Commitments, or their Total Commitments, as the context requires, in
each case as such Dollar amounts are set forth beside such Lender's name under
the applicable heading on Schedule C-2 or on the signature page of the
Assignment and Acceptance pursuant to which such Lender became a Lender
hereunder in accordance with the provisions of Section 14.1.
"Compliance Certificate" means a certificate substantially in
the form of Exhibit C-1 delivered by the chief financial officer of Parent to
Agent.
"Concentration Account" means account number 42-4903 of U-Haul
maintained at Bank One, Arizona or such other deposit account (located in the
United States) established by Borrower with the consent of Agent.
"Confirmation Date" means the date on which the Court entered
the Confirmation Order.
"Confirmation Order" has the meaning set forth in the recitals
of this Agreement.
"Consents" means, collectively, the written approval or
consent to the transactions contemplated by this Agreement and the Loan
Documents duly executed and delivered by each Person party to a Material
Contract whose consent to the transactions contemplated by this Agreement is
required by the terms of such agreement (other than such consents otherwise
provided for in the Reorganization Plan).
"Consolidated" means, with respect to Parent, the
consolidation of the income statement accounts of Parent's Subsidiaries with
those of Parent, all in accordance with GAAP, provided, that "consolidated" will
not include (a) the consolidation of the accounts of SAC Holding with the
accounts of Parent but for the inclusion of interest income earned on the Junior
Notes and management fees earned by U-Haul related to properties it manages that
are owned by SAC Holding; and (b) the consolidation of the accounts of the
Insurance Subsidiaries with the accounts of Parent but for the inclusion of
pre-tax net income earned by (or losses of) the Insurance Subsidiaries.
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"Consolidated Cash Interest Expense" means, for any period,
the Consolidated Interest Expense of Parent paid in cash for such period
(including, without limitation, the Unused Line Fees, the interest component of
any deferred payment obligations, the interest component of all payments
associated with Capitalized Lease Obligations, commissions, discounts and other
fees and charges incurred in respect of a Letter of Credit or bankers'
acceptance financing and net payment pursuant to Hedge Agreements), provided
that Consolidated Cash Interest Expense shall exclude interest expense accrued
or capitalized during such period.
"Consolidated Charges" means, for any period, any
extraordinary and/or non-recurring Consolidated charges of Parent, representing
restructuring charges, payments to restructuring financial advisors and legal
counsel, non-cash impairment of asset charges and other non-cash write-offs that
were deducted in arriving at Consolidated Net Income; provided, however, (a) the
aggregate amount of Consolidated Charges calculated for the 3-month period
ending March 31, 2004 shall not exceed $75,000,000, (b) the aggregate amount of
Consolidated Charges calculated for the 3-month period ending June 30, 2004
shall not exceed $3,800,000, (c) the aggregate amount of Consolidated Charges
calculated for the 6-month period ending September 30, 2004 shall not exceed
$7,500,000, (d) the aggregate amount of Consolidated Charges calculated for the
9-month period ending December 31, 2004 shall not exceed $11,300,000, and (e)
the aggregate amount of Consolidated Charges calculated for the 12-month period
ending March 31, 2005 and as of the end of each fiscal quarter thereafter shall
not exceed $15,000,000.
"Consolidated EBITDA" means, for any period, the sum, without
duplication, of (i) Consolidated Net Income for such period; plus (ii)
Consolidated Interest Expense for such period; plus (iii) provision for
Consolidated taxes of Parent based on income or profits for such period (to the
extent such income or profits were included in computing the Consolidated Net
Income for such period); plus (iv) Consolidated depreciation, amortization and
other non-cash expense of Parent; plus (v) Consolidated Charges in each case
that were deducted in determining the Consolidated Net Income for such period;
minus (vi) pre-tax net income of the Insurance Subsidiaries; plus (vii) losses
of the Insurance Subsidiaries; minus (viii) gains from sales of any Real
Property; plus (ix) losses from sales of any Real Property minus (x) to the
extent the Synthetic Leases (including any refinancings, in whole or in part,
thereof), or any of them, are treated as Capital Leases in accordance with the
requirements of GAAP, the amounts of principal and interest due and paid under
such Synthetic Leases for such period, as such principal amounts are set forth
on Schedule 7.8(a).
"Consolidated Interest Expense" means, for any period, the
Consolidated interest expense of Parent for such period, whether paid, accrued
or capitalized (including, without limitation, amortization of original issue
discount, non-cash interest payments, Unused Line Fees, the interest component
of any deferred payment obligations, the interest component of all payments
associated with Capitalized Lease Obligations, commissions, discounts and other
fees and charges incurred in respect of a Letter of Credit or bankers'
acceptance financing and net payments pursuant to Hedge Agreements).
"Consolidated Net Income" means, for any period, the net
income of Parent for such period, determined in accordance with GAAP, provided
that such net income is calculated pursuant to the income statement presentation
set forth in the definition of "Consolidated".
11
"Continuing Director" means (a) any member of the Board of
Directors who was a director (or comparable manager) of Parent on the Closing
Date, and (b) any individual who becomes a member of the Board of Directors
after the Closing Date if such individual was appointed or nominated for
election to the Board of Directors by a majority of the Continuing Directors,
but excluding any such individual originally proposed for election in opposition
to the Board of Directors in office at the Closing Date in an actual or
threatened election contest relating to the election of the directors (or
comparable managers) of Parent (as such terms are used in Rule 14a-11 under the
Exchange Act) and whose initial assumption of office resulted from such contest
or the settlement thereof.
"Control Agreement" means a control agreement, in form and
substance reasonably satisfactory to Agent, executed and delivered from time to
time by Administrative Borrower or one of its Subsidiaries, Agent, and the
applicable securities intermediary with respect to a Securities Account or a
bank with respect to a Deposit Account.
"Copyright Security Agreement" means that certain copyright
security agreement executed and delivered by all Borrowers and Guarantors that
own copyrights as of the Closing Date, and Agent, the form and substance of
which are reasonably satisfactory to Agent.
"Court" has the meaning set forth in the recitals of this
Agreement.
"Credit Card Agreements" means those certain agreements
between Agent and the credit card processors of Borrowers or Guarantors
delivered from time to time pursuant to which such credit card processors agree
to transfer on a daily basis all credit card receipts of Borrowers or
Guarantors, as applicable, into the Concentration Account or other Cash
Management Account acceptable to Agent.
"Daily Balance" means, with respect to any Obligation and each
day during the term of this Agreement, the amount of such Obligation owed at the
end of such day.
"DDA" means any checking or other demand deposit account
maintained by any Borrower.
"Dealer List" has the meaning set forth in Section 6.2(d).
"Dealership Contract" means a U-Haul dealership contract
between a Subsidiary of U-Haul, on the one hand, and a U-Haul Dealer, on the
other hand.
"Debtors" has the meaning set forth in the recitals of this
Agreement.
"Default" means an event, condition, or default that, with the
giving of notice, the passage of time, or both, would be an Event of Default.
"Default Rate" has the meaning set forth in Section 2.6(c)(i).
"Defaulting Lender" means any Lender that fails to make any
Advance (or other extension of credit) that it is required to make hereunder on
the date that it is required to do so hereunder.
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"Defaulting Lender Rate" means (a) the Base Rate for the first
3 days from and after the date the relevant payment is due, and (b) thereafter,
at the interest rate then applicable to Advances that are Base Rate Loans
(inclusive of the Applicable Margin) applicable thereto.
"Deposit Accounts" means any Person's now owned or hereafter
acquired right, title and interest with respect to any "deposit account" as such
term is defined in the Code, including, without limitation, any DDAs.
"Designated Account" means that certain DDA of Administrative
Borrower identified on Schedule D-1.
"Designated Account Bank" means the designated institution
that has been designated as such on Schedule D-1 or has otherwise been
designated as such, in writing, by Administrative Borrower to Agent.
"DIP Lender" has the meaning set forth in the recitals of this
Agreement.
"DIP Loan Agreement" has the meaning set forth in the recitals
of this Agreement.
"DIP Obligations" means, as of any date of determination, all
Obligations (as defined in the DIP Loan Agreement) outstanding under the DIP
Loan Agreement, including any Advances (as defined in the DIP Loan Agreement)
outstanding (including, without limitation, the face amount of any outstanding
Letter of Credit issued pursuant to the DIP Loan Agreement), the Term Loan (as
defined in the DIP Loan Agreement), and accrued interest, fees and other charges
payable thereunder.
"Disbursement Letter" means an instructional letter executed
and delivered by Administrative Borrower to Agent regarding the initial
extensions of credit to be made on the Closing Date, the form and substance of
which are reasonably satisfactory to Agent.
"Dollars" or "$" means United States dollars.
"Dormant Subsidiaries" means, collectively, EJOS, Inc., an
Arizona corporation, Japal, Inc., a Nevada corporation, M.V.S., Inc., a Nevada
corporation, Pafran, Inc., a Nevada corporation, Sophmar, Inc., a Nevada
corporation, and Picacho Peak Investments Co., a Nevada corporation.
"Due Diligence Letter" means the due diligence letter sent by
Agent's counsel to Administrative Borrower, together with Administrative
Borrower's completed responses to the inquiries set forth therein, the form and
substance of such responses to be reasonably satisfactory to Agent.
"ECF Carry Forward Amount" means, at any time of
determination, (a)(i) as of the Closing Date through September 30, 2004,
$3,335,000, (ii) as of October 1, 2004 through March 30, 2005, 50% of Borrowers'
Excess Cash Flow (whether positive or negative) for the period commencing on
April 1, 2004 and ending on September 30, 2004, based on unaudited financial
statements provided to Agent pursuant to Section 6.3(a), or (iii) as of March
31, 2005
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and at all times thereafter, 50% of Borrowers' Excess Cash Flow for the fiscal
year ending March 31, 2005 (whether positive or negative), based on the audited
financial statements provided to Agent pursuant to Section 6.3(b), plus
Borrowers' Excess Cash Flow for each fiscal year thereafter (to the extent
positive) for which audited financial statements have been provided to Agent
pursuant to Section 6.3(b), minus (b) the sum of (i) the aggregate amount of
dividends paid in arrears on account of the preferred stock of Parent on or
after January 1, 2004 made from Borrowers' Excess Cash Flow pursuant to clause
(c) of Section 7.11, (ii) the aggregate amount of prepayments of the principal
amount of the Indebtedness under the New AMERCO Notes, the Term B Notes made
from Borrowers' Excess Cash Flow after the Closing Date pursuant to clause (2)
of Section 7.8(a)(v), and (iii) the aggregate amount of prepayments of the
principal amount of the Indebtedness under the Synthetic Leases made from
Borrowers' Excess Cash Flow after the Closing Date pursuant to clause (3) of
Section 7.8(a)(vi), in each case on a cumulative basis.
"Effective Date" has the meaning set forth in the
Reorganization Plan.
"Eligible Transferee" means (a) a commercial bank organized
under the laws of the United States, or any state thereof, and having total
assets in excess of $250,000,000, (b) a commercial bank organized under the laws
of any other country which is a member of the Organization for Economic
Cooperation and Development or a political subdivision of any such country and
which has total assets in excess of $250,000,000, provided that such bank is
acting through a branch or agency located in the United States, (c) a finance
company, insurance company, or other financial institution or fund that is
engaged in making, purchasing, or otherwise investing in commercial loans in the
ordinary course of its business and having (together with its Affiliates) total
assets in excess of $250,000,000, (d) any Affiliate (other than individuals) of
a Lender that was party hereto as of the Closing Date, including, without
limitation, a fund or account managed or administered by such Lender or an
Affiliate of such Lender or its investment manager or administrator (a "Related
Fund"), (e) the Persons required to become Lenders hereunder by the terms of the
Reorganization Plan, (f) so long as no Event of Default has occurred and is
continuing, any other Person approved by Agent and Administrative Borrower
(which approval of Administrative Borrower shall not be unreasonably withheld,
delayed or conditioned), and (g) during the continuation of an Event of Default,
any other Person approved by Agent.
"Enforcement Event" means the exercise by Agent of any
remedies under Section 9.1 hereof during the continuation of any Event of
Default.
"Environmental Actions" means any complaint, summons,
citation, notice, directive, order, claim, litigation, investigation, judicial
or administrative proceeding, judgment, letter, or other communication from any
Governmental Authority, or any third party involving violations of Environmental
Laws or releases of Hazardous Materials from (a) any assets, properties, or
businesses of any Borrower or any predecessor in interest, (b) from adjoining
properties or businesses, or (c) from or onto any facilities which received
Hazardous Materials generated by any Borrower or any predecessor in interest.
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"Environmental Indemnity Agreements" means, collectively,
those certain environmental indemnity agreements executed and delivered by
Borrowers and Guarantors in favor of Agent, in form and substance reasonably
satisfactory to Agent.
"Environmental Law" means any applicable federal, state,
provincial, foreign or local statute, law, rule, regulation, ordinance, code,
binding and enforceable guideline, binding and enforceable written policy, or
rule of common law now or hereafter in effect and in each case as amended, or
any judicial or administrative interpretation thereof, including any judicial or
administrative order, consent decree or judgment, to the extent binding on
Borrowers, relating to the environment, employee health and safety, or Hazardous
Materials, including CERCLA; RCRA; the Federal Water Pollution Control Act, 33
U.S.C. Section 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. Section
2601 et seq.; the Clean Air Act, 42 U.S.C. Section 7401 et seq.; the Safe
Drinking Water Act, 42 U.S.C. Section 3803 et seq.; the Oil Pollution Act of
1990, 33 U.S.C. Section 2701 et seq.; the Emergency Planning and the Community
Right-to-Know Act of 1986, 42 U.S.C. Section 11001 et seq.; the Hazardous
Material Transportation Act, 49 U.S.C. Section 1801 et seq.; and the
Occupational Safety and Health Act, 29 U.S.C. Section 651 et seq. (to the extent
it regulates occupational exposure to Hazardous Materials); any state and local
or foreign counterparts or equivalents, in each case as amended from time to
time.
"Environmental Liabilities and Costs" means all liabilities,
monetary obligations, Remedial Actions, losses, damages, punitive damages,
consequential damages, treble damages, costs and expenses (including all
reasonable fees, disbursements and expenses of counsel, experts, or consultants
and costs of investigation and feasibility studies), fines, penalties,
sanctions, and interest incurred as a result of any claim or demand by any
Governmental Authority or any third party, and which relate to any Environmental
Action.
"Environmental Lien" means any Lien in favor of any
Governmental Authority for Environmental Liabilities and Costs.
"Environmental Remediation Reserve" means a reserve against
Availability, in an amount determined by Agent upon consultation with its
environmental experts, with respect to environmental remediation costs for
certain of the Real Property Collateral, as the amount of such reserve may
increase or decrease from time to time in Agent's Permitted Discretion;
provided, however, the amount of such reserve established by Agent as of the
Closing Date may only (a) increase (i) upon the discovery of any fact or the
change of any circumstances after the Closing Date that Agent determines in its
Permitted Discretion may result in a material increase in Borrowers'
environmental liability and (ii) upon prior consultation with Borrowers, or (b)
decrease (i) if, in Agent's Permitted Discretion, Borrowers present substantive
evidence indicating a reduction in Borrowers' environmental liability and (ii)
upon the consent of the Required Lenders.
"Equipment" means any Person's now owned or hereafter acquired
right, title, and interest with respect to equipment, machinery, machine tools,
motors, furniture, furnishings, fixtures, Vehicles, tools, parts, goods (other
than consumer goods, farm products, or Inventory), wherever located, including
all attachments, accessories, accessions, replacements, substitutions,
additions, and improvements to any of the foregoing.
15
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute thereto.
"ERISA Affiliate" means (a) any Person subject to ERISA whose
employees are treated as employed by the same employer as the employees of a
Borrower or a Subsidiary of a Borrower under IRC Section 414(b), (b) any trade
or business subject to ERISA whose employees are treated as employed by the same
employer as the employees of a Borrower or a Subsidiary of a Borrower under IRC
Section 414(c), (c) solely for purposes of Section 302 of ERISA and Section 412
of the IRC, any organization subject to ERISA that is a member of an affiliated
service group of which a Borrower or a Subsidiary of a Borrower is a member
under IRC Section 414(m), or (d) solely for purposes of Section 302 of ERISA and
Section 412 of the IRC, any Person subject to ERISA that is a party to an
arrangement with a Borrower or a Subsidiary of a Borrower and whose employees
are aggregated with the employees of a Borrower or a Subsidiary of a Borrower
under IRC Section 414(o).
"ERISA Event" means (a) a Reportable Event with respect to any
Benefit Plan or Multiemployer Plan, (b) the withdrawal of any Borrower, any of
any Borrower's Subsidiaries or ERISA Affiliates from a Benefit Plan during a
plan year in which it was a "substantial employer" (as defined in Section
4001(a)(2) of ERISA), (c) with respect to any Benefit Plan, the providing of
notice of intent to terminate a Benefit Plan in a distress termination (as
described in Section 4041(c) of ERISA), (d) the institution by the PBGC of
proceedings to terminate a Benefit Plan or Multiemployer Plan, (e) any event or
condition (i) that provides a basis under Section 4042(a)(1), (2) or (3) of
ERISA for the termination of, or the appointment of a trustee to administer, any
Benefit Plan or Multiemployer Plan, or (ii) that may result in termination of a
Multiemployer Plan pursuant to Section 4041A of ERISA, (f) the partial or
complete withdrawal within the meaning of Sections 4203 and 4205 of ERISA, of
Borrower, any of Borrower's Subsidiaries or ERISA Affiliates from a
Multiemployer Plan, or (g) providing any security to any plan under Section
401(a)(29) of the IRC by any Borrower or any of its Subsidiaries or any of their
ERISA Affiliates.
"Event of Default" has the meaning set forth in Section 8.
"Excess Availability" means the amount, as of the date any
determination thereof is to be made, equal to the difference between (a) the
lesser of (i) the Borrowing Base or (ii) the sum of (1) the Maximum Revolver
Amount plus (2) the Term Loan Amount, and (b) the Obligations then outstanding.
"Excess Availability Test" means, at the time of payment of
any Indebtedness under the New AMERCO Notes or the Term B Notes pursuant to
Section 7.8(a)(v)(2) or at the time of declaration or payment of any dividend or
dividend in arrears pursuant to Section 7.11(b) or Section 7.11(c),
respectively, (a) Borrowers' Excess Availability plus Qualified Cash (as
reported by Borrowers pursuant to Section 6.2(a)) exceeds (i) $35,000,000 plus
(ii) the amount of such dividend or debt payment as of the date of such payment
and as of the month end for each of the preceding consecutive 12 fiscal months
immediately preceding such payment date, and (b) after giving effect to such
payment, Borrowers' Excess Availability plus Qualified Cash, as reflected in the
Projections most recently delivered to Agent pursuant to Section 6.3(c), is
16
projected to exceed $35,000,000 for the month end of each of the 12 fiscal
months immediately succeeding such payment date.
"Excess Cash Flow" means, for the fiscal year most recently
ended prior to any determination date and based upon the audited financial
statements delivered by Borrowers pursuant to Section 6.3(b), (a) Consolidated
EBITDA, minus (b) the sum of (i) Consolidated Cash Interest Expense, plus (ii)
Capital Expenditures permitted hereunder, plus (iii) payments of the principal
amount of Funded Debt (other than Advances and prepayments of the Term Loan B
Notes and the New AMERCO Notes paid from Borrowers' Excess Cash Flow pursuant to
clause (2) of Section 7.8(a)(v) hereof) paid during such period and other
permitted debt service payments made, plus (v) federal, state and local income
taxes paid in cash, minus (c) the aggregate amount of dividends paid on account
of the Stock of Parent during such fiscal year pursuant to clause (b) of Section
7.11.
"Exchange Act" means the Securities Exchange Act of 1934, as
in effect from time to time.
"Excluded Assets" means (a) the Synthetic Leases, and the
Synthetic Lease Collateral, (b) the Junior Notes and the interest accrued
thereon, and proceeds received from the monetization of Junior Notes, (c) all
Real Property set forth on Schedule E-1 under contract of sale as of the Closing
Date and proceeds received from any such sale, (d) all Real Property subject to
a first priority Lien of Oxford as of the Closing Date, as set forth on Schedule
E-1, (e) all Real Property designated as "Surplus Real Property" as of the
Closing Date, as set forth on Schedule E-1 and any proceeds received from any
sale of such Real Property, (f) Parent's Stock of the Insurance Subsidiaries and
the proceeds received from the monetization of such Stock, (g) proceeds in
excess of $50,000,000 from any settlement, judgment or other recovery from the
PWC Litigation, (h) Vehicles (including any tow dolly or auto transport) that,
as of the Closing Date are or thereafter become, and remain subject to, a TRAC
Lease Transaction and proceeds from the sale of such Vehicles to the extent no
Loan Party has any rights to or interest in such proceeds, except to the extent
such Vehicles become subject to the Agent's Liens pursuant to Section 7.4
hereof, (i) Vehicles (including any tow dolly or auto transport) that become and
remain subject to the PMCC Leveraged Lease and proceeds from the sale of such
Vehicles to the extent no Loan Party has any rights to or interest in such
proceeds, and (j) the cash collateral accounts set forth on Schedule 2.7(e).
With respect to the Excluded Assets set forth in clause (g) above, it is hereby
acknowledged and agreed that attorneys' fees and costs, court costs, expert
witness fees and expenses and other similar costs and expenses paid or payable
by Parent with respect to the PWC Litigation or any current or future taxes paid
or payable by Parent with respect to settlement payments or damage awards (after
taking into account any available tax credits or deductions and any tax sharing
arrangements) with respect to the PWC Litigation shall not be deducted from or
otherwise offset against Agent's Collateral.
"Executive Order No. 13224" means Executive Order No. 13224 on
Terrorist Financing, effective September 24, 2001, as the same has been, or
shall hereafter be, renewed, extended, amended or replaced.
"Fair Market Valuation" means the most recent fair market
valuation acceptable to the Lender Group (and determined at the direction or
request of Agent or the Lender Group by
17
a third party appraiser acceptable to the Lender Group) of the Real Property
Collateral acceptable to Agent which is subject to a valid and perfected first
priority Agent's Lien, subject only to Permitted Liens of the type described in
clauses (b), (f), (j), (k), (l) and (n) of the definition thereof.
"Family Member" means, with respect to any individual, the
spouse and lineal descendants (including children and grandchildren by adoption)
of such individual, the spouses of each such lineal descendants, and the lineal
descendants of such Persons.
"Family Trusts" means, with respect to any individual, any
trusts, limited partnerships or other entities established for the primary
benefit of, the executor or administrator of the estate of, or other legal
representative of, such individual.
"Fee Letter" means that certain fee letter, dated as of even
date herewith, between Borrowers and Agent, in form and substance reasonably
satisfactory to Agent.
"FEIN" means Federal Employer Identification Number.
"FIRREA" means Financial Institutions Reform, Recovery and
Enforcement Act, as in effect from time to time.
"Fonde de pouvoir" has the meaning set forth in Section 16.21.
"Foothill" means Xxxxx Fargo Foothill, Inc., a California
corporation.
"Funded Debt" means without double-counting, with respect to
Parent on a Consolidated basis, as of any date of determination, all obligations
of the type described in clauses (a) through (c) and clause (e) of the
definition of "Indebtedness" set forth in Section 1.1 hereof and clause (f) of
such definition with respect to any guaranty of any of the foregoing, and
specifically including, without limitation, the amount of outstanding
Obligations hereunder.
"Funding Date" means the date on which a Borrowing occurs.
"Funding Losses" has the meaning set forth in Section
2.13(b)(ii).
"GAAP" means generally accepted accounting principles as in
effect from time to time in the United States, consistently applied.
"General Intangibles" means any Person's now owned or
hereafter acquired right, title, and interest with respect to general
intangibles (as that term is defined in the Code), including payment
intangibles, contract rights, rights to payment, rights arising under common
law, statutes, or regulations, choses or things in action, goodwill, patents,
trade names, trademarks, servicemarks, copyrights, blueprints, drawings,
purchase orders, customer lists, monies due or recoverable from pension funds,
route lists, rights to payment and other rights under any royalty or licensing
agreements, infringement claims, computer programs, information contained on
computer disks or tapes, software, literature, reports, catalogs, pension plan
refunds, pension plan refund claims, insurance premium rebates, tax refunds, and
tax refund claims, and any and all Supporting Obligations in respect thereof,
and any other personal
18
property other than goods, money, Accounts, Chattel Paper, Commercial Tort
Claims, Deposit Accounts, Investment Property, and Negotiable Collateral.
"Governing Documents" means, with respect to any Person, the
certificate or articles of incorporation, bylaws, or other organizational
documents of such Person.
"Governmental Authority" means any federal (including the
federal government of Canada), state, provincial, local, or other governmental
or administrative body, instrumentality, department, or agency or any court,
tribunal, administrative hearing body, arbitration panel, commission, or other
similar dispute-resolving panel or body.
"Guarantor" and "Guarantors" means all direct and indirect
Subsidiaries of Parent that are not a party to this Agreement, except for the
Insurance Subsidiaries, any Subsidiary formed under the laws of a jurisdiction
outside of the United States and Canada, Storage Realty, L.L.C., a Texas limited
liability company, INW, and the Dormant Subsidiaries. For the avoidance of
doubt, SAC Holding shall not be a Guarantor under this Agreement. As of the
Closing Date, all Guarantors are listed on Schedule G-1.
"Guarantor Security Agreement" means, collectively, one or
more security agreements, hypothecs or other similar agreements executed and
delivered by Guarantors and Agent, the form and substance of which are
reasonably satisfactory to Agent.
"Guaranty" means, collectively, one or more general continuing
guaranty agreements executed and delivered by Guarantors in favor of Agent, in
form and substance reasonably satisfactory to Agent.
"Hazardous Materials" means (a) substances that are defined or
listed in, or otherwise classified pursuant to, any Applicable Laws or
regulations as "hazardous substances," "hazardous materials," "hazardous
wastes," "toxic substances," or any other formulation intended to define, list,
or classify substances by reason of deleterious properties such as ignitability,
corrosivity, reactivity, carcinogenicity, reproductive toxicity, or "EP
toxicity", (b) oil, petroleum, or petroleum derived substances, natural gas,
natural gas liquids, synthetic gas, drilling fluids, produced waters, and other
wastes associated with the exploration, development, or production of crude oil,
natural gas, or geothermal resources, (c) any flammable substances or explosives
or any radioactive materials, and (d) asbestos in any form or electrical
equipment that contains any oil or dielectric fluid containing levels of
polychlorinated biphenyls in excess of 50 parts per million.
"Hedge Agreement" means any and all agreements or documents
now existing or hereafter entered into by Administrative Borrower or its
Subsidiaries that provide for an interest rate, credit, commodity or equity
swap, cap, floor, collar, forward foreign exchange transaction, currency swap,
cross currency rate swap, currency option, or any combination of, or option with
respect to, these or similar transactions, for the purpose of hedging
Administrative Borrower's or its Subsidiaries' exposure to fluctuations in
interest or exchange rates, loan, credit exchange, security or currency
valuations or commodity prices.
"Holdout Lender" has the meaning set forth in Section 15.2.
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"Indebtedness" means (a) all obligations for borrowed money,
(b) all obligations evidenced by bonds, debentures, notes, or other similar
instruments and all reimbursement or other obligations in respect of letters of
credit, bankers acceptances, interest rate swaps, or other financial products,
(c) all obligations as a lessee under Capital Leases, (d) all obligations or
liabilities of others secured by a Lien on any asset of a Person or its
Subsidiaries, irrespective of whether such obligation or liability is assumed,
(e) all obligations to pay the deferred purchase price of assets (other than
trade payables incurred in the ordinary course of business and repayable in
accordance with customary trade practices), and (f) any obligation guaranteeing
or intended to guarantee (whether directly or indirectly guaranteed, endorsed,
co-made, discounted, or sold with recourse) any obligation of any other Person
that constitutes Indebtedness under any of clauses (a) through (e) above.
"Indemnified Liabilities" has the meaning set forth in Section
11.3.
"Indemnified Person" has the meaning set forth in Section
11.3.
"Insolvency Proceeding" means any proceeding commenced by or
against any Person under any provision of the Bankruptcy Code or under any other
state, provincial or federal (including the federal laws of Canada) bankruptcy
or insolvency law, assignments for the benefit of creditors, formal or informal
moratoria, compositions, extensions generally with creditors, or proceedings
seeking reorganization, arrangement, or other similar relief.
"Insurance Subsidiaries" means, collectively, Oxford and
RepWest.
"Intangible Assets" means, with respect to any Person, that
portion of the book value of all of such Person's assets that would be treated
as intangibles under GAAP.
"Interest Period" means, with respect to each LIBOR Rate Loan,
a period commencing on the date of the making of such LIBOR Rate Loan (or the
continuation of a LIBOR Rate Loan or the conversion of a Base Rate Loan to a
LIBOR Rate Loan) and ending 1, 2, 3, or 6 months thereafter; provided, however,
that (a) if any Interest Period would end on a day that is not a Business Day,
such Interest Period shall be extended (subject to clauses (c) through (e)
below) to the next succeeding Business Day, (b) interest shall accrue at the
applicable rate based upon the LIBOR Rate from and including the first day of
each Interest Period to, but excluding, the day on which any Interest Period
expires, (c) any Interest Period that would end on a day that is not a Business
Day shall be extended to the next succeeding Business Day unless such Business
Day falls in another calendar month, in which case such Interest Period shall
end on the next preceding Business Day, (d) with respect to an Interest Period
that begins on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the end of
such Interest Period), the Interest Period shall end on the last Business Day of
the calendar month that is 1, 2, 3, or 6 months after the date on which the
Interest Period began, as applicable, and (e) Borrowers (or Administrative
Borrower on behalf thereof) may not elect an Interest Period which will end
after the Maturity Date.
"IntraLinks" means IntraLinks, Inc. or any other digital
workspace provider selected by Agent from time to time after notice to
Administrative Borrower.
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"Inventory" means any Person's now owned or hereafter acquired
right, title, and interest with respect to inventory, including goods held for
sale or lease or to be furnished under a contract of service, goods that are
leased by such Person as lessor, goods that are furnished by such Person under a
contract of service, and raw materials, work in process, or materials used or
consumed in such Person's business, including, without limitation, supplies and
embedded software.
"Investment" means, with respect to any Person, any investment
by such Person in any other Person (including Affiliates) in the form of loans,
guarantees, advances, or capital contributions (excluding (a) commission,
travel, and similar advances to officers and employees of such Person made in
the ordinary course of business, and (b) bona fide Accounts arising in the
ordinary course of business consistent with past practices), purchases or other
acquisitions for consideration of Indebtedness or Stock, and any other items
that are or would be classified as investments on a balance sheet prepared in
accordance with GAAP.
"Investment Property" means any Person's now owned or
hereafter acquired right, title, and interest with respect to "investment
property" as that term is defined in the Code, and any and all Supporting
Obligations in respect thereof.
"INW" means INW Company, a Washington corporation.
"IRC" means the Internal Revenue Code of 1986, as in effect
from time to time.
"IRS" means the Internal Revenue Service of the United States
and any successor thereto.
"Issuing Lender" means Foothill or any other Lender that, at
the request of Administrative Borrower and with the consent of Agent agrees, in
such Lender's sole discretion, to become an Issuing Lender for the purpose of
issuing L/Cs or L/C Undertakings pursuant to Section 2.12.
"JPMorgan" means JPMorganChase Bank, as Administrative Agent
for the Lenders under that certain 3-Year Credit Agreement dated as of June 28,
2002.
"Junior Notes" means those promissory notes issued by SAC
Holding to Nationwide Commercial Co., an Arizona corporation, U-Haul and Oxford
prior to Parent Relief Date, as amended and restated as of the Closing Date.
"L/C" has the meaning set forth in Section 2.12(a).
"L/C Disbursement" means a payment made by the Issuing Lender
pursuant to a Letter of Credit.
"L/C Undertaking" has the meaning set forth in Section
2.12(a).
"Lender" and "Lenders" have the respective meanings set forth
in the preamble to this Agreement, and shall include any other Person made a
party to this Agreement in accordance with the provisions of Section 14.1.
21
"Lender Group" means, individually and collectively, each of
the Lenders (including the Issuing Lender) and Agent.
"Lender Group Expenses" means all (a) costs or expenses
(including taxes, mortgage recording taxes, and insurance premiums) required to
be paid by a Borrower or its Subsidiaries under any of the Loan Documents that
are paid or incurred by the Lender Group, (b) out of pocket fees or charges
paid, advanced or incurred by Agent in connection with the Lender Group's
transactions with Borrowers or their Subsidiaries, including, fees or charges
for photocopying, notarization, couriers and messengers, telecommunication,
public record searches (including tax lien, litigation, and Uniform Commercial
Code searches and including searches with the patent and trademark office, the
copyright office, or the department of motor vehicles), filing, recording,
publication, IntraLinks, appraisal (including periodic Collateral appraisals and
business valuations) to the extent of the fees and charges (and up to the amount
of any limitation) contained in this Agreement, real estate surveys, real estate
title policies and endorsements, environmental audits, and other amounts payable
in connection with any Mortgage, (c) costs and expenses in the disbursement of
funds to or for the account of Borrowers or other members of the Lender Group
(by wire transfer or otherwise), (d) charges paid or incurred by Agent resulting
from the dishonor of checks, (e) reasonable costs and expenses paid or incurred
by the Lender Group to correct any default or enforce any provision of the Loan
Documents, or in gaining possession of, maintaining, handling, preserving,
storing, shipping, selling, preparing for sale, or advertising to sell the
Collateral, or any portion thereof, irrespective of whether a sale is
consummated, (f) audit fees and expenses of Agent related to audit examinations
of the Loan Parties' Books to the extent of the fees and charges (and up to the
amount of any limitation) contained in this Agreement, (g) reasonable costs and
expenses of third party claims or any other suit paid or incurred by the Lender
Group, in either case in connection with enforcing or defending the Loan
Documents or in connection with the transactions contemplated by the Loan
Documents or the Lender Group's relationship with any Borrower or any Subsidiary
of a Borrower, (h) Agent's and, during the occurrence of an Event of Default,
each Lender's reasonable fees and expenses (including attorneys' fees) incurred
in advising, structuring, drafting, reviewing, administering, syndicating or
amending the Loan Documents, and (i) Agent's and each Lender's reasonable fees
and expenses (including attorneys', accountants', consultants', and other
advisors' fees and expenses) incurred in terminating, enforcing (including
attorneys' accountants', consultants', and other advisors' fees and expenses
incurred in connection with any "workout," "restructuring," or any other
Insolvency Proceeding concerning any Borrower or any Subsidiary or in exercising
rights or remedies under the Loan Documents), or defending the Loan Documents,
irrespective of whether suit is brought, or in taking any Remedial Action
concerning the Collateral.
"Lender-Related Person" means, with respect to any Lender,
such Lender, together with such Lender's Affiliates, and the officers,
directors, employees, attorneys and agents of such Lender.
"Letter of Credit" means an L/C or an L/C Undertaking, as the
context requires.
"Letter of Credit Fee" has the meaning set forth in Section
2.6(b).
22
"Letter of Credit Usage" means, as of any date of
determination, the aggregate undrawn amount of all outstanding Letters of Credit
plus 100% of the amount of outstanding time drafts accepted by an Underlying
Issuer as a result of drawings under Underlying Letters of Credit.
"LIBOR Deadline" has the meaning set forth in Section
2.13(b)(i).
"LIBOR Notice" means a written notice in the form of Exhibit
L-1.
"LIBOR Option" has the meaning set forth in Section 2.13(a).
"LIBOR Rate" means, for each Interest Period for each LIBOR
Rate Loan, the rate per annum determined by Agent (rounded upwards, if
necessary, to the next 1/16%) by dividing (a) the Base LIBOR Rate for such
Interest Period, by (b) 100% minus the Reserve Percentage. The LIBOR Rate shall
be adjusted on and as of the effective day of any change in the Reserve
Percentage, but in any event the LIBOR Rate shall not be less than 1.00% per
annum.
"LIBOR Rate Loan" means each portion of an Advance or the Term
Loan that bears interest at a rate determined by reference to the LIBOR Rate.
"Lien" means any interest in an asset securing an obligation
owed to, or a claim by, any Person other than the owner of the asset,
irrespective of whether (a) such interest shall be based on the common law,
statute, or contract, (b) such interest shall be recorded or perfected, and (c)
such interest shall be contingent upon the occurrence of some future event or
events or the existence of some future circumstance or circumstances. Without
limiting the generality of the foregoing, the term "Lien" includes the lien,
security interest or hypothec arising from a mortgage, deed of trust,
encumbrance, pledge, hypothecation, assignment, deposit arrangement, security
agreement, conditional sale or trust receipt, or from a lease, consignment, or
bailment for security purposes and also including reservations, exceptions,
encroachments, easements, rights-of-way, covenants, conditions, restrictions,
leases, and other title exceptions and encumbrances affecting Real Property.
"Loan Account" has the meaning set forth in Section 2.10.
"Loan Documents" means this Agreement (together with all
exhibits and schedules hereto), the Agency Letter, the Cash Management
Agreements, the Collateral Access Agreements, the Confirmation Order, the
Consents, the Control Agreements, the Copyright Security Agreement, the Credit
Card Agreements, the Disbursement Letter, the Due Diligence Letter, the
Environmental Indemnity Agreements, the Fee Letter, the Guarantor Security
Agreement, the Guaranty, the Letters of Credit, the Mortgages, the Officers'
Certificate, the Patent and Trademark Security Agreement, the Quebec Security
Documents, the Release of Claims, the Stock Pledge Agreement, the Term Loan B
Intercreditor Agreement, any note or notes executed by a Borrower in connection
with this Agreement and payable to a member of the Lender Group, and any other
agreement entered into, now or in the future, by any Borrower or any Guarantor
in connection with this Agreement.
23
"Loan Party" means any Borrower or any Guarantor, and "Loan
Parties" means all Borrowers and all Guarantors.
"Loan Pledgee" has the meaning set forth in Section 14.1(j).
"Loan Pledgor" has the meaning set forth in Section 14.1(j).
"Major Space Leases" means lease agreements, other than lease
agreements covering all or a portion of Real Property subject to the Synthetic
Leases, pursuant to which the proposed demised premises exceeds 5,000 square
feet and the proposed term thereof, inclusive of all extensions and renewals,
exceeds 10 years.
"Management Agreements" means, collectively, those certain
property management agreements between Subsidiaries of U-Haul, on the one hand,
and any of SAC Holding or SSI, on the other hand.
"Material Adverse Change" means (a) a material adverse change
in the business, prospects, operations, results of operations, assets,
liabilities or condition (financial or otherwise) of Borrowers and their
Subsidiaries (other than the Insurance Subsidiaries) taken as a whole, (b) a
material impairment of a Borrower's or Subsidiary of a Borrower's ability to
perform its obligations under the Loan Documents to which it is a party or of
the Lender Group's ability to enforce the Obligations or realize upon the
Collateral, or (c) a material impairment of the enforceability or priority of
the Agent's Liens with respect to the Collateral as a result of an action or
failure to act on the part of a Borrower or a Subsidiary of a Borrower (other
than the Insurance Subsidiaries). For the avoidance of doubt, changes solely
affecting SAC Holding shall not constitute a Material Adverse Change.
"Material Contracts" means the agreements set forth on
Schedule M-1, which include each of the agreements (a) filed in connection with
any Loan Party's SEC Filings and in existence as of the Closing Date, (b)
executed in connection with the Reorganization Plan, and (c) those agreements to
which any Loan Party is a party and the loss or breach of which by such Loan
Party would result in a Material Adverse Change, as such agreements are in
existence on the Closing Date or as amended to the extent permitted hereunder.
"Maturity Date" has the meaning set forth in Section 3.4.
"Maximum Revolver Amount" means $200,000,000 (less the amount
of any reductions established by Agent pursuant to clause (h) of the definition
of Permitted Dispositions set forth herein).
"Mortgage Policy" has the meaning set forth in Section 3.1(s).
"Mortgages" means, individually and collectively, one or more
mortgages, hypothecs, deeds of trust, or deeds to secure debt, executed and
delivered by a Borrower or a Guarantor in favor of Agent or the Fonde de
pouvoir, in form and substance reasonably satisfactory to Agent, that encumber
the Real Property Collateral and the related improvements thereto.
24
"Multiemployer Plan" means a "multiemployer plan" (as defined
in Section 4001(a)(3) of ERISA) to which Parent, any of its Subsidiaries, or any
ERISA Affiliate has contributed, or was obligated to contribute, within the past
six (6) years.
"Negotiable Collateral" means any Person's now owned and
hereafter acquired right, title, and interest with respect to letters of credit,
letter of credit rights, instruments, promissory notes, drafts, and documents,
and any and all Supporting Obligations in respect thereof.
"Net Disposition" means the aggregate amount of Net Proceeds
received by a Loan Party from the disposition of any Equipment that is a capital
asset and any Real Property that constitutes an Excluded Asset during any
period.
"Net Proceeds" means, with respect to any asset disposition by
Parent or any Subsidiary of Parent or any proceeds from casualty insurance
received by Parent or any Subsidiary, the aggregate amount of cash or Cash
Equivalents received for such assets, net of (a) reasonable and customary
transaction costs and expenses, (b) transfer taxes (including sales and use
taxes), (c) amounts payable to holders of applicable Permitted Liens hereunder
to the extent that such Permitted Liens (other than the Synthetic Leases), if
any, are senior in priority to the Agent's Liens, (d) an appropriate reserve for
income taxes in accordance with GAAP, and (e) appropriate amounts to be provided
as a reserve against liabilities or otherwise held in escrow in association with
any such disposition, in each case clauses (a) through (e) to the extent the
amounts so deducted are properly attributable to such transaction and payable
(or reserved) by Parent or any Subsidiary of Parent in connection with such
disposition or loss, including without limitation reasonable and customary
commissions and underwriting discounts, to a Person that is not an Affiliate of
Parent or such Subsidiary.
"New AMERCO Note Accounts" means, collectively, the Restated
SAC Notes Escrow Account, the 3.08(b) Account and any other Deposit Account that
holds or otherwise constitutes the collateral securing the obligations under the
New AMERCO Note Documents.
"New AMERCO Note Documents" means, collectively, the New
AMERCO Note Indenture, the New AMERCO Notes and such other documents (in form
and substance acceptable to Agent) executed by Parent in connection therewith.
"New AMERCO Note Indenture" means that certain Indenture with
respect to the issuance of the New AMERCO Notes, dated as of March 15, 2004,
among Parent, the guarantors listed on the signature pages thereto, and The Bank
of New York, as trustee, in form and substance acceptable to Agent (including,
without limitation, containing subordination provisions acceptable to Agent).
"New AMERCO Note Lenders" means those Persons that are
"Holders" under the New AMERCO Note Indenture.
"New AMERCO Notes" means the 12% Senior Secured Subordinated
Notes Due 2011 in the principal amount of $148,646,137 issued pursuant to the
New AMERCO Note Indenture.
25
"Obligations" means (a) all loans (including the Term Loan),
Advances, debts, principal, interest (including any interest that, but for the
provisions of the Bankruptcy Code, would have accrued), contingent reimbursement
obligations with respect to outstanding Letters of Credit, premiums, liabilities
(including all amounts charged to Borrowers' Loan Account pursuant hereto),
obligations (including indemnification obligations), fees (including the fees
provided for in the Fee Letter), charges, costs, Lender Group Expenses
(including any fees or expenses that, but for the provisions of the Bankruptcy
Code, would have accrued), lease payments, guaranties, covenants, and duties of
any kind and description owing by Borrowers to the Lender Group pursuant to or
evidenced by the Loan Documents and irrespective of whether for the payment of
money, whether direct or indirect, absolute or contingent, due or to become due,
now existing or hereafter arising, and including all interest not paid when due
and all Lender Group Expenses that Borrowers are required to pay or reimburse by
the Loan Documents, by law, or otherwise, and (b) all Bank Product Obligations.
Any reference in this Agreement or in the Loan Documents to the Obligations
shall include all amendments, changes, extensions, modifications, renewals
replacements, substitutions, and supplements, thereto and thereof, as
applicable, both prior and subsequent to any Insolvency Proceeding.
"OFAC" means the Office of Foreign Assets Control of the
United States Department of the Treasury.
"Officers' Certificate" means the representations and
warranties of officers form submitted by Agent to Administrative Borrower,
together with Administrative Borrower's completed responses to the inquiries set
forth therein, the form and substance of such responses to be reasonably
satisfactory to Agent.
"Organizational ID Number" means, with respect to any Person,
the organizational identification number assigned to such Person by the
applicable governmental unit or agency of the jurisdiction of organization or
formation of such Person.
"Originating Lender" has the meaning set forth in Section
14.1(e).
"Overadvance" has the meaning set forth in Section 2.5.
"Oxford" means Oxford Life Insurance Company, an Arizona
corporation, and its Subsidiaries, whether now existing or hereafter formed.
"Parent" has the meaning set forth in the preamble to this
Agreement.
"Parent Relief Date" means June 20, 2003.
"Participant" has the meaning set forth in Section 14.1(e).
"Participant Register" has the meaning set forth in Section
14.1(i).
"Patent and Trademark Security Agreement" means that certain
patent and trademark security agreement executed and delivered by all Borrowers
and Guarantors that own patent or trademarks as of the Closing Date, and Agent,
the form and substance of which are reasonably satisfactory to Agent.
26
"PBGC" means the Pension Benefit Guaranty Corporation as
defined in Title IV of ERISA, or any successor thereto.
"Permitted Discretion" means a determination made in good
faith and in the exercise of reasonable (from the perspective of a secured
asset-based lender) business judgment.
"Permitted Dispositions" means (a) sales or other dispositions
by Borrowers or their Subsidiaries of Equipment that is substantially worn,
damaged, or obsolete in the ordinary course of business, as determined by
Borrowers or their Subsidiaries, as the case may be, (b) the use or transfer of
money or Cash Equivalents by Borrowers or their Subsidiaries in a manner that is
not prohibited by the terms of this Agreement or the other Loan Documents, (c)
the licensing by Borrowers or their Subsidiaries, on a non-exclusive basis, of
patents, trademarks, copyrights, and other intellectual property rights in the
ordinary course of business, (d) conveyances, sales, assignments, leases,
transfers or dispositions of any Excluded Asset, (e) leases and licenses of
self-storage units to customers in the ordinary course of business, (f) the
granting of billboard and cell tower leases on any Real Property, (g) the
granting of space leases in the ordinary course of business that do not
constitute Major Space Leases, unless otherwise consented to by the Agent, (h)
dispositions of Real Property or any part thereof required in connection with
condemnations or takings, or dispositions in lieu thereof, where the
compensation paid on account thereof is immediately remitted by Borrowers to
Agent; provided Agent may, in its Permitted Discretion, on a pro rata basis,
reduce the Maximum Revolver Amount and require the repayment of the Term Loan by
an amount up to the fair market value of the Real Property subject to such
condemnation or taking, (i) so long as no Event of Default has occurred and is
continuing, dispositions of box-trucks, cargo vans and pickup trucks in the
ordinary course of Administrative Borrower's and U-Haul's fleet rotation
program, so long as the aggregate net book value of box-trucks, cargo vans and
pickup trucks subject to Agent's Liens does not decrease by more than (i)
$40,000,000 in any of (A) the first fiscal quarter after the Closing Date (to be
tested as of the end of such period), (B) the first two fiscal quarters after
the Closing Date (to be tested as of the end of such period), (C) the first
three fiscal quarters after the Closing Date (to be tested as of the end of such
period), or (D) each 12-month period thereafter (to be tested as of the end of
each fiscal quarter), or (ii) $160,000,000 in the aggregate after the Closing
Date, (j) the granting of Permitted Easements, (k) so long as no Event of
Default has occurred and is then continuing, the sale in the ordinary course of
business of Vehicles acquired within the previous 130 days in connection with a
TRAC Lease Transaction to the extent the obligations thereunder are permitted by
this Agreement, (l) the sale, disposition or replacement of Vehicles exchanged
in connection with the PMCC Like Kind Exchange Lease, (m) sales or other
dispositions set forth in the Reorganization Plan and approved in the
Confirmation Order, (n) the sale of that certain portion of the parcel of Real
Property Collateral located at 000 Xxxxx Xxxx, Xxxxxxxxxxxx, Xxx Xxxx that is
subject to the lease purchase option exercised prior to the Closing Date, (o) so
long as no Event of Default shall be caused thereby, other dispositions of Real
Property Collateral with a Fair Market Valuation in an aggregate amount not to
exceed either (i) $10,000,000 during any fiscal year or (ii) $35,000,000 in
total after the Closing Date, unless otherwise consented to by the Required
Lenders; provided, however, the sale or other disposition of any parcel of Real
Property Collateral (x) shall result in a Loan Party receiving proceeds in an
amount of not less than 80% of the Fair Market Valuation of such Real Property
Collateral, and (y) with an appraised Fair Market Valuation exceeding $7,000,000
shall not constitute a Permitted Disposition, unless consented to by the
Required Lenders, and (p) leases
27
and licenses of any portion of the Real Property subject to the Synthetic Leases
to tenants in the ordinary course of business.
"Permitted Easements" means (a) easements, licenses,
rights-of-way and other rights and privileges in the nature of easements
reasonably necessary or desirable for the use, repair, or maintenance of any
Real Property as herein provided and (b) if required by applicable Governmental
Authority, the dedication or transfer of unimproved portions of any Real
Property for road, highway or other public purposes; so long as, in each case
(other than with respect to Real Property subject to the Synthetic Leases) (i)
such grant, dedication or transfer does not materially impair the value or
remaining useful life of the applicable Real Property or the fair market value
of such Real Property or materially impair or interfere with the use or
operations thereof, (ii) such grant, dedication or transfer, in Administrative
Borrower's business judgment, is reasonably necessary in connection with the
use, maintenance, alteration or improvement of the applicable Real Property and
(iii) such grant, dedication or transfer will not cause the applicable Real
Property or any portion thereof to fail to comply with the provisions of the
Loan Documents and all Applicable Law.
"Permitted Holder" means Xxxxxx X. Xxxxx, Xxxx X. Xxxxx, Xxxxx
X. Xxxxx, and their Family Members, and their Family Trusts.
"Permitted Investments" means (a) Investments in cash and Cash
Equivalents, (b) Investments in negotiable instruments for collection, (c)
advances made in connection with purchases of goods or services in the ordinary
course of business, (d) Investments by any Loan Party in any other Loan Party;
provided, to the extent such Investment is in the form of Indebtedness, such
Indebtedness shall be unsecured and contractually subordinated to the
Obligations and, upon any such Loan Party ceasing to be a wholly-owned
Subsidiary of Parent or such Indebtedness being owed to any Person other than a
Loan Party, such Loan Party shall be deemed to have incurred Indebtedness not
permitted by this clause (d), (e) Investments by U-Haul and Nationwide
Commercial Co. evidenced by the Junior Notes not to exceed the principal amount
outstanding thereunder as of the Closing Date (except for increases in principal
resulting solely from the accrual of interest thereon), (f) payments by U-Haul
and its Subsidiaries of expenses on behalf of SAC Holdings pursuant to the
Management Agreements provided that all such expenses are promptly reimbursed by
the appropriate other parties to the Management Agreements, (g) Investments in
PMSR, PM Preferred or any of its or their Affiliates owned by Parent or any of
its Subsidiaries or SAC Holding solely to the extent required pursuant to
Parent's obligations under the Support Party Agreements, so long as (i) on the
date of such Investment, Borrowers' Excess Availability plus Qualified Cash (as
reported by Borrowers pursuant to Section 6.2(a)) exceeds (A) $35,000,000 plus
(B) the amount of such Investment, as of the date of such payment and as of the
end of the month for each of the preceding consecutive 12 fiscal months
immediately preceding such payment date, (ii) after giving effect to such
Investment, Borrowers' Excess Availability plus Qualified Cash, as reflected in
the Projections most recently delivered to Agent pursuant to Section 6.3(c) is
projected to exceed $35,000,000 as of the month end for each of the 12 fiscal
months immediately succeeding the date of such Investment for each of the 12
fiscal months, and (iii) no Event of Default has occurred and is continuing or
would result therefrom, (h) guarantees by Parent of the obligations of its
Subsidiaries that are Loan Parties to the extent such obligations are otherwise
permitted hereunder and are consistent with past practices, (i) payments by
U-Haul and its Subsidiaries in
28
the ordinary course of business and consistent with past practices of certain
ordinary course operating expenses on behalf of any U-Haul Dealer pursuant to a
Dealership Contract, provided that the applicable U-Haul Dealer reimburses
U-Haul and its Subsidiaries for all such expenses in accordance with the
provisions of the Dealership Contract, (j) Hedge Agreements, as permitted
hereunder, (k) Investments pursuant to that certain promissory note dated
February 12, 1997 from PMSR in favor of U-Haul in the original principal amount
of $10,000,000, with such Indebtedness of PMSR thereunder assumed by PMSI
Investors, LLC on or about November 30, 1999, and (l) other Investments in an
aggregate amount not to exceed $5,000,000 per year, unless otherwise consented
to by the Required Lenders.
"Permitted Liens" means (a) Liens held by Agent to secure the
Obligations, (b) Liens for unpaid taxes that (i) are not yet delinquent, or (ii)
are the subject of a Permitted Protest, (c) Liens set forth on Schedule P-1, (d)
(i) Liens on the Synthetic Lease Collateral arising under the Synthetic Leases
and the interests of lessors under operating leases, and (ii) the interests of
the lessor and indenture trustee under the PMCC Leveraged Lease, (e) purchase
money Liens or the interests of lessors in leased assets under Capital Leases to
the extent that such Liens or interests secure Purchase Money Indebtedness
permitted hereunder and so long as such Lien attaches only to the asset
purchased or acquired and the proceeds thereof, (f) Liens arising by operation
of law in favor of warehousemen, landlords, carriers, mechanics, materialmen,
laborers, or suppliers, incurred in the ordinary course of business and not in
connection with the borrowing of money, and which Liens either (i) are for sums
not yet delinquent or (ii) are the subject of Permitted Protests, (g) Liens
arising from deposits made in connection with obtaining worker's compensation or
other unemployment insurance, (h) Liens or deposits to secure performance of
bids, tenders, or leases incurred in the ordinary course of business and not in
connection with the borrowing of money, (i) Liens granted as security for surety
or appeal bonds in connection with obtaining such bonds in the ordinary course
of business, (j) Liens with respect to the Real Property Collateral that are
exceptions to the commitments for title insurance issued in connection with the
Mortgages, as accepted by Agent, (k) with respect to any Real Property,
Permitted Easements, (l) Liens arising from judgments and attachments in
connection with court proceedings provided that the attachment or enforcement of
such Liens would not result in an Event of Default hereunder and such Liens are
subject to a Permitted Protest and no material Collateral is subject to a
material risk of loss or forfeiture and the claims in respect of such Liens are
fully covered by insurance (subject to ordinary and customary deductibles) and a
stay of execution pending appeal or proceeding for review is in effect, (m)
Liens granted to the New AMERCO Note Lenders pursuant to the New AMERCO Note
Documents on the property described in clauses (b), (c), (e), (f) and (g) of the
definition of Excluded Assets set forth in Article 1 hereof, (n) Liens granted
to the Term Loan B Note Lenders pursuant to the Term Loan B Note Documents,
subject to the Term Loan B Intercreditor Agreement, (o) Liens on Real Property
in favor of Oxford as of the Closing Date, as set forth on Schedule E-1, and (p)
subject to the provisions of Section 2.7(e), Liens on the cash collateral
accounts set forth on Schedule 2.7(e).
"Permitted Protest" means the right of Administrative Borrower
or any of its Subsidiaries, as applicable, to protest any Lien (other than any
such Lien that secures the Obligations), taxes (other than payroll taxes or
taxes that are the subject of a United States federal tax lien), or rental
payment, provided that (a) a reserve with respect to such obligation is
established on such Person's Books in such amount as is required under GAAP, (b)
any such
29
protest is instituted promptly and prosecuted diligently by Administrative
Borrower or any of its Subsidiaries, as applicable, in good faith, and (c) Agent
is satisfied that, while any such protest is pending, there will be no
impairment of the enforceability, validity, or priority of any of the Agent's
Liens.
"Person" means any natural person, corporation, limited
liability company, limited partnership, general partnership, limited liability
partnership, joint venture, trust, land trust, business trust, or other
organization, irrespective of whether it is a legal entity, and any government
and agency or political subdivision thereof.
"Personal Property Collateral" means all Collateral other than
Real Property.
"Pledge" has the meaning set forth in Section 14.(j).
"PMCC Like Kind Exchange Lease" means that certain Master
Equipment Lease Agreement dated as of June 30, 2000, between Norwest Bank
Minnesota, National Association, as lessor, and U-Haul Leasing & Sales Co., as
lessee, and all ancillary agreements referenced therein, as all of the foregoing
exist on the Closing Date, and as amended to the extent permitted herein.
"PMCC Leveraged Lease" means that certain Equipment Lease
Agreement (U-Haul Trust No. 96-1) dated as of June 28, 1996 between Fleet
National Bank, as lessor, and U-Haul Leasing & Sales Co., as lessee, and all
ancillary agreements referenced therein, as all of the foregoing exist on the
Closing Date, and as amended to the extent permitted herein.
"PM Preferred" means PM Preferred Properties, L.P., a Texas
limited partnership.
"PMSR" means Private Mini Storage Realty, L.P., a Texas
limited partnership.
"PMSR Agreement" means that certain PMSR Agreement dated as of
the Effective Date among Parent, PMSR, JPMorgan Chase Bank, as agent, and the
Lenders party thereto.
"PPSA" means the Personal Property Security Act, as in effect
from time to time in any applicable Canadian province or territory.
"Projections" means Parent's forecasted (a) balance sheets,
(b) profit and loss statements, and (c) cash flow statements together with
appropriate supporting details and a statement of underlying assumptions, all
prepared on a basis consistent with the presentation set forth in the definition
of "Consolidated" and on a basis consistent with Parent's financial statements
delivered to Lenders prior to the Closing Date.
"Pro Rata Share" means, as of any date of determination:
(a) with respect to a Lender's obligation to make
Advances and receive payments of principal, interest, fees, costs, and expenses
with respect thereto, (i) prior to the Revolver Commitments being terminated or
reduced to zero, the percentage obtained by dividing (y) such Lender's Revolver
Commitment, by (z) the aggregate Revolver Commitments of all
30
Lenders, and (ii) from and after the time that the Revolver Commitments have
been terminated or reduced to zero, the percentage obtained by dividing (y) the
aggregate outstanding principal amount of such Lender's Advances by (z) the
aggregate outstanding principal amount of all Advances,
(b) with respect to a Lender's obligation to participate
in Letters of Credit, to reimburse the Issuing Lender, and to receive payments
of fees with respect thereto, (i) prior to the Revolver Commitments being
terminated or reduced to zero, the percentage obtained by dividing (y) such
Lender's Revolver Commitment, by (z) the aggregate Revolver Commitments of all
Lenders, and (ii) from and after the time that the Revolver Commitments have
been terminated or reduced to zero, the percentage obtained by dividing (y) the
aggregate outstanding principal amount of such Lender's Advances by (z) the
aggregate outstanding principal amount of all Advances,
(c) with respect to a Lender's obligation to make the
Term Loan and receive payments of interest, fees, and principal with respect
thereto, (i) prior to the making of the Term Loan, the percentage obtained by
dividing (y) such Lender's Term Loan Commitment, by (z) the aggregate amount of
all Lenders' Term Loan Commitments, and (ii) from and after the making of the
Term Loan, the percentage obtained by dividing (y) the principal amount of such
Lender's portion of the Term Loan by (z) the principal amount of the Term Loan,
and
(d) with respect to all other matters as to a particular
Lender (including the indemnification obligations arising under Section 16.7),
the percentage obtained by dividing (i) such Lender's Revolver Commitment plus
the outstanding principal amount of such Lender's portion of the Term Loan, by
(ii) the aggregate amount of Revolver Commitments of all Lenders plus the
outstanding principal amount of the Term Loan; provided, however, that in the
event the Revolver Commitments have been terminated or reduced to zero, Pro Rata
Share under this clause shall be the percentage obtained by dividing (A) the
outstanding principal amount of such Lender's Advances plus such Lender's
ratable portion of the Risk Participation Liability with respect to outstanding
Letters of Credit plus the outstanding principal amount of such Lender's portion
of the Term Loan, by (B) the outstanding principal amount of all Advances plus
the aggregate amount of the Risk Participation Liability with respect to
outstanding Letters of Credit plus the outstanding principal amount of the Term
Loan.
"Purchase Money Indebtedness" means Indebtedness (other than
the Obligations, but including Capitalized Lease Obligations), incurred at the
time of, or within 20 days after, the acquisition of any fixed assets for the
purpose of financing all or any part of the acquisition cost thereof.
"PWC Litigation" means that certain claim filed by
Administrative Borrower against PricewaterhouseCoopers on or about June 5, 2003
in the Superior Court of Arizona, Maricopa County, No. CV2003-011032, and all
related disputes between Administrative Borrower and PricewaterhouseCoopers.
"Qualified Cash" means, as of any date of determination, the
amount of unrestricted cash and Cash Equivalents of the Loan Parties that is in
Deposit Accounts or in Securities Accounts, or any combination thereof, and
after August 15, 2003, which such Deposit
31
Account or Securities Account is the subject of a Control Agreement and is
maintained by a branch office of the bank or securities intermediary located
within the United States.
"Quebec Security Documents" means, collectively, (a) the deed
of hypothec and issue of bonds by each Canadian Subsidiary in favor of the Fonde
de pouvoir creating a hypothec in the principal amount of Cdn$1,320,000,000 in
all the Canadian Subsidiaries' personal (movable) and real (immovable) property,
(b) the delivery order by each Canadian Subsidiary to the Fonde de pouvoir, (c)
the 25% demand bond issued by each Canadian Subsidiary to the Agent and
certified by the Fonde de pouvoir, and (d) the pledge agreement by each Canadian
Subsidiary pledging the 25% demand bond in favor of the Agent, the form and
substance of which are reasonably satisfactory to Agent.
"Real Property" means any estates or interests in real
property now owned or hereafter acquired by any Loan Party and the improvements
thereto.
"Real Property Collateral" means the parcel or parcels of Real
Property identified on Schedule R-1 and any Real Property hereafter acquired by
a Loan Party on which Agent has or is required (in accordance with this
Agreement or any other Loan Document) to have a Lien.
"Record" means information that is inscribed on a tangible
medium or which is stored in an electronic or other medium and is retrievable in
perceivable form.
"Redirection Notice" has the meaning set forth in Section
14.1(j).
"Register" has the meaning set forth in Section 14.1(h).
"Registered Loan" has the meaning set forth in Section 2.16.
"Registered Note" has the meaning set forth in Section 2.16.
"Related Fund" has the meaning set forth in clause (d) of the
definition of Eligible Transferee.
"Release of Claims" means that certain release of claims dated
of even date herewith executed by Borrowers and Guarantors (each as defined
therein) under the DIP Loan Agreement in favor of Foothill and the DIP Lenders,
in form and substance reasonably satisfactory to Foothill.
"Remedial Action" means all actions taken to (a) clean up,
remove, remediate, contain, treat, monitor, assess, evaluate, or in any way
address Hazardous Materials in the indoor or outdoor environment, (b) prevent or
minimize a release or threatened release of Hazardous Materials so they do not
migrate or endanger or threaten to endanger public health or welfare or the
indoor or outdoor environment, (c) perform any pre-remedial studies,
investigations, or post-remedial operation and maintenance activities, or (d)
conduct any other actions authorized by 42 U.S.C. Section 9601.
"Reorganization Plan" has the meaning set forth in the
recitals of this Agreement.
32
"Report" has the meaning set forth in Section 16.17.
"Reportable Event" means any of the events described in
Section 4043(c) of ERISA or the regulations thereunder other than a Reportable
Event as to which the provision of 30 days' notice to the PBGC is waived under
applicable regulations.
"Replacement Lender" has the meaning set forth in Section
15.2.
"RepWest" means Republic Western Insurance Company, an Arizona
corporation, and its Subsidiaries, whether now existing or hereafter formed.
"Required Availability" means that the sum of (a) Excess
Availability plus (b) Qualified Cash exceeds $25,000,000.
"Required Lenders" means, at any time, Lenders whose Pro Rata
Shares aggregate 51% of the Total Commitments, or if the Commitments have been
terminated irrevocably, 51% of the Obligations (other than Bank Product
Obligations) then outstanding.
"Reservation Management System" means the software system
known as "Microres," which is used in connection with customer reservations of
U-Haul products and services.
"Reserve Percentage" means, on any day, for any Lender, the
maximum percentage prescribed by the Board of Governors of the Federal Reserve
System (or any successor Governmental Authority) for determining the reserve
requirements (including any basic, supplemental, marginal, or emergency
reserves) that are in effect on such date with respect to eurocurrency funding
(currently referred to as "eurocurrency liabilities") of that Lender, but so
long as such Lender is not required or directed under applicable regulations to
maintain such reserves, the Reserve Percentage shall be zero.
"Restated SAC Notes Escrow Account" means that certain
segregated Deposit Account or investment account maintained by Parent pursuant
to Section 11.05 of the New AMERCO Notes Indenture.
"Retiree Health Plan" means an "employee welfare benefit plan"
within the meaning of Section 3(1) of ERISA that provides benefits to
individuals after termination of their employment, other than as required by
Section 601 of ERISA.
"Revolver Commitment" means, with respect to each Lender, its
Revolver Commitment, and, with respect to all Lenders, their Revolver
Commitments, in each case as such Dollar amounts are set forth beside such
Lender's name under the applicable heading on Schedule C-2 or on the signature
page of the Assignment and Acceptance pursuant to which such Lender became a
Lender hereunder in accordance with the provisions of Section 14.1.
"Revolver Usage" means, as of any date of determination, the
sum of (a) the then extant amount of outstanding Advances, plus (b) the then
extant amount of the Letter of Credit Usage.
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"Risk Participation Liability" means, as to each Letter of
Credit, all reimbursement obligations of Borrowers to the Issuing Lender with
respect to an L/C Undertaking, consisting of (a) the amount available to be
drawn or which may become available to be drawn, (b) all amounts that have been
paid by the Issuing Lender to the Underlying Issuer to the extent not reimbursed
by Borrowers, whether by the making of an Advance or otherwise, and (c) all
accrued and unpaid interest, fees, and expenses payable with respect thereto.
"SAC Holding" means, collectively, SAC Holding Corporation, a
Nevada corporation, SAC Holding II Corporation, a Nevada corporation, Montreal
Holding Corporation, a Nevada corporation, and each of their respective
Subsidiaries, whether now existing or hereafter formed.
"SAC Holding Senior Bond" means the 8.5% senior notes due 2014
in the principal amount of $200,000,000 issued pursuant to the SAC Notes
Indenture.
"SAC Notes Indenture" means that certain Indenture with
respect to the issuance of the SAC Holding Senior Bond, dated as of March 15,
2004, among SAC Holding Corporation, SAC Holding II Corporation and Law
Debenture Trust Company of New York.
"SAC Participation and Subordination Agreement" means that
certain participation and subordination agreement dated as of March 15, 2004, by
and among SAC Holding, Parent, U-Haul, and Law Debenture Trust Company of New
York, as Trustee under the SAC Notes Indenture.
"Sale Date" has the meaning set forth in Section 7.4.
"SEC" means the United States Securities and Exchange
Commission and any successor thereto.
"SEC Filings" means, with respect to any Person, all reports,
documents and other information filed by such Person pursuant to the Securities
Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended,
and all other rules and regulations promulgated by the SEC, including such
Person's filed Form 10-K and subsequently filed quarterly reports on Form 10-Q
and current reports on Form 8-K.
"Securities Account" means a "securities account" as that term
is defined in the Code.
"Settlement" has the meaning set forth in Section 2.3(f)(i).
"Settlement Date" has the meaning set forth in Section
2.3(f)(i).
"Solvent" means, with respect to any Person on a particular
date, that such Person is not insolvent (as defined in the Uniform Fraudulent
Transfer Act) or is not an "insolvent person" (as defined in the Bankruptcy and
Insolvency Act (Canada)) or is not a "debtor company" (as defined in the
Companies' Creditors Arrangement Act (Canada)).
34
"SSI" means Self-Storage International Holding Corporation, a
Nevada corporation, and any Subsidiary thereof, whether now existing or
hereafter formed.
"Statutory Lien Payments" has the meaning set forth in Section
5.23.
"Stock" means all shares, options, warrants, interests,
participations, or other equivalents (regardless of how designated) of or in a
Person, whether voting or nonvoting, including common stock, preferred stock, or
any other "equity security" (as such term is defined in Rule 3a11-1 of the
General Rules and Regulations promulgated by the SEC under the Exchange Act).
"Stock Pledge Agreement" means, collectively, one or more
stock pledge agreements, the form and substance of which are reasonably
satisfactory to Agent, executed and delivered by each Borrower or Guarantor that
owns Stock of a Subsidiary of Parent; provided a Stock Pledge Agreement shall
not be required in connection with the Stock of the Insurance Subsidiaries, the
Dormant Subsidiaries, INW, or Storage Realty, L.L.C.
"Subsidiary" of a Person means a corporation, partnership,
limited liability company, or other entity in which that Person directly or
indirectly owns or controls the shares of Stock having ordinary voting power to
elect a majority of the board of directors (or appoint other comparable
managers) of such corporation, partnership, limited liability company, or other
entity; provided, however, PMSR, PM Preferred, SAC Holding and SSI shall not be
deemed to be Subsidiaries of any Borrower herein.
"Support Party Agreement" means, collectively, (a) that
certain Support Party Agreement dated as of February 28, 2003 by and among
Parent and PM Preferred in favor of GMAC Commercial Holding Corp., as
administrative agent, as amended by the First Amendment to Support Party
Agreement dated as of June 13, 2003, and (b) that certain PMSR Agreement to be
dated as of the Effective Date, by and among Parent, PMSR, XX Xxxxxx Xxxxx Bank,
as administrative agent, and the lenders signatory thereto, in each case as
amended prior to the Closing Date and after the Closing Date as permitted herein
(provided, in each case, such amendment does not increase the obligations of any
Loan Party thereunder).
"Supporting Obligation" means any Person's now owned or
hereafter acquired right, title and interest with respect to any "supporting
obligation" as that term is defined in the Code.
"Swing Lender" means Foothill or any other Lender that, at the
request of Administrative Borrower and with the consent of Agent agrees, in such
Lender's sole discretion, to become the Swing Lender hereunder.
"Swing Loan" has the meaning set forth in Section 2.3(d)(i).
"Synthetic Lease Collateral" means (i) the Real Property and
Real Property interests leased under the Synthetic Leases and all structures,
buildings, and other immovable improvements located on such Real Property (the
"Synthetic Lease Properties"); (ii) all equipment, machinery, apparatus,
fittings, furniture, fixtures and other property of every kind and nature
whatsoever now or hereafter affixed to any portion of the Synthetic Lease
Properties
35
or which is used for the storage of property of storage customers of any
Synthetic Lessee under any Assigned Storage Agreements (defined below)
(excluding Vehicles), and which are now owned or hereafter acquired by any
lessor under any Synthetic Lease or in which any such lessor has or shall have
an interest, and all appurtenances and additions thereto and substitutions
therefor; (iii) all storage rental agreements, leases and licenses with respect
to the Synthetic Lease Properties now or hereinafter entered into and all
amendments, supplements and modifications thereto (collectively, the "Assigned
Storage Agreements"); (iv) all rents, maintenance fees, advance fees and
deposits, security deposits and prepaid amounts, income, receipts, issues,
profits and revenues arising from the Synthetic Lease Properties; (v) to the
extent arising from Assigned Storage Agreements or other rights to payment for
storage space at the Synthetic Lease Properties by storage customers, "general
intangibles" (including "payment intangibles") and "accounts" (as such terms are
defined in the Code), and other rights to payment for storage space at the
Synthetic Lease Properties by storage customers; (vi) license and concession
fees, proceeds and other benefits to which any Synthetic Lessee or any agent of
a Synthetic Lessee may now or hereafter be entitled with respect to the Assigned
Storage Agreements; (vii) all books, records, writings, data bases, and
information relating to, used or useful in connection with, evidencing,
embodying, incorporating or referring to, any of the foregoing; (viii) any award
or compensation or insurance payment or other proceeds to which any Synthetic
Lessee may become entitled by reason of its interest in the Synthetic Lease
Properties; and (ix) all products, offspring, rents, issues, profits, returns,
income and Proceeds (as defined in the Code) of and from any and all of the
foregoing.
"Synthetic Lease Properties" has the meaning set forth in the
definition of "Synthetic Lease Collateral".
"Synthetic Leases" means, collectively, (i) the Amended and
Restated Master Lease dated as of March 15, 2004 between AREC, as lessee, and
BMO Global Capital Solutions, Inc., as lessor, and any other documents,
agreements, mortgages, deeds of trust and other instruments executed in
connection therewith, (ii) that certain Second Amended and Restated Master Lease
and Open-End Mortgage dated as of March 15, 2004 among U-Haul and AREC, as
lessees, the various Lessors identified therein, as lessor, and BMO Global
Capital Solutions, Inc. as Agent Lessor for the Lessors, and any documents,
agreements, mortgages, deeds of trust, and other instruments executed in
connection therewith, and (iii) that certain Canadian U-Haul Master Lease dated
as of April 5, 2001 between Computershare Trust Company of Canada, as successor
to Montreal Trust Company of Canada, and U-Haul (Canada), and any documents,
agreements, mortgages, deeds of trust, and other instruments executed in
connection therewith, each as may be subsequently amended, restated or
refinanced to the extent permitted hereunder.
"Synthetic Lessee" means any of AREC, U-Haul and U-Haul
(Canada) and any of their respective successors in interest as lessees under the
Synthetic Leases that may succeed to such interests in accordance with this
Agreement and the applicable Synthetic Leases.
"Taxes" has the meaning set forth in Section 16.11(e).
"Term Loan" has the meaning set forth in Section 2.2(a).
"Term Loan Amount" means $350,000,000.
36
"Term Loan Commitment" means, with respect to each Lender, its
Term Loan Commitment and, with respect to all Lenders, their Term Loan
Commitments, in each case as such Dollar amounts are set forth beside such
Lender's name under the applicable heading on Schedule C-2 or on the signature
page of the Assignment and Acceptance pursuant to which such Lender became a
Lender hereunder in accordance with the provisions of Section 14.1.
"Term Loan B Intercreditor Agreement" means that certain
Intercreditor Agreement entered into and delivered by and among Agent and Xxxxx
Fargo Bank, N.A., as trustee, in form and substance reasonably satisfactory to
Agent.
"Term Loan B Note Documents" means, collectively, the Term
Loan B Note Indenture, the Term Loan B Notes and such other documents (in form
and substance acceptable to Agent) executed by Parent in connection therewith.
"Term Loan B Note Indenture" means that certain Indenture with
respect to the issuance of the Term Loan B Notes, dated as of March 1, 2004,
among Parent, the guarantors listed on the signature pages thereto and Xxxxx
Fargo Bank, National Association, as trustee, in form and substance acceptable
to Agent.
"Term Loan B Note Lenders" means those Persons that are
"Holders" under the Term Loan B Note Indenture.
"Term Loan B Notes" means the 9% Senior Secured Notes in the
principal amount of $200,000,000 due 2009 issued pursuant to the Term Loan B
Note Indenture.
"3.08(b) Account" means that certain segregated Deposit
Account or investment account maintained by Parent at The Bank of New York
pursuant to Section 3.08(b) of the New AMERCO Notes Indenture.
"Title Reserve" means a reserve against Availability in an
amount determined by Agent upon consultation with its counsel with respect to
title defects and exceptions for certain of the Real Property Collateral.
"Total Commitment" means, with respect to each Lender, its
Total Commitment, and, with respect to all Lenders, their Total Commitments, in
each case as such Dollar amounts are set forth beside such Lender's name under
the applicable heading on Schedule C-2 attached hereto or on the signature page
of the Assignment and Acceptance pursuant to which such Lender became a Lender
hereunder in accordance with the provisions of Section 14.1.
"TRAC Lease Transaction" means any operating or capital lease
(as determined in accordance with GAAP) entered into by any Loan Party pursuant
to a "Terminal Rental Adjustment Clause" lease (including, without limitation,
the PMCC Like Kind Exchange Lease) whereby (a) (i) the ownership of a Vehicle
that is owned by such Loan Party is transferred to a lessor within 130 days of
the acquisition of such Vehicle or (ii) the ownership of a Vehicle is
transferred to a lessor by someone other than a Loan Party, and (b) the Vehicle
so transferred is leased back to the Loan Party by such lessor.
"U-Haul" means U-Haul International, Inc., a Nevada
corporation.
37
"U-Haul (Canada)" means U-Haul Co. (Canada) Ltd. U-Haul Co.
(Canada) Ltee, an Ontario corporation.
"U-Haul Dealer" means any Person that leases Vehicles on
behalf of U-Haul in the ordinary course of business pursuant to a Dealership
Contract, as identified on the Dealer List.
"Underlying Issuer" means a third Person which is the
beneficiary of an L/C Undertaking and which has issued a letter of credit at the
request of the Issuing Lender for the benefit of Borrowers.
"Underlying Letter of Credit" means a letter of credit that
has been issued by an Underlying Issuer.
"Unused Line Fee" has the meaning set forth in Section
2.11(a).
"USA Patriot Act" means the Uniting and Strengthening America
by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act
of 2001, Pub. L. No. 107-56, 115 Stat. 272 (2001), as the same has been, or
shall hereafter be, renewed, extended, amended or replaced.
"Vehicle" or "Vehicles" means any vehicle (including any motor
vehicle), trailer or other asset of any Loan Party represented by a certificate
of title.
"Voidable Transfer" has the meaning set forth in Section 17.7.
"Xxxxx Fargo" means Xxxxx Fargo Bank, National Association, a
national banking association.
"WP Xxxxx Transaction" means the transaction, in form and
substance reasonably satisfactory to Required Lenders, whereby UH Storage (DE)
Limited Partnership, a Delaware limited partnership, or other Affiliate of W.P.
Xxxxx & Co., LLC, will acquire the Real Property that is subject to the
Synthetic Leases (excluding Real Property located in Canada) and such Synthetic
Leases shall be paid in full and terminated, all as more fully set forth on
Schedule W-1.
1.2 ACCOUNTING TERMS; GAAP. Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided that for purposes
of determining compliance with any covenant set forth in Section 7, such terms
shall be construed in accordance with GAAP as in effect on the date of this
Agreement applied on a basis consistent with the application used in preparing
Borrowers' audited financial statements referred to in Section 6.3. If any
change in accounting principles from those used in the preparation of the
audited financial statements referred to in Section 6.3 hereafter occasioned by
the promulgation of any rule, regulation, pronouncement or opinion by or
required by the Financial Accounting Standards Board (or successors thereto or
agencies with similar functions) would result in a change in the method of
calculation of financial covenants, standards or terms found in Section 1 or
Section 7, the parties hereto agree to enter into negotiations in order to amend
such provisions so as to equitably reflect such changes with the desired result
that the criteria for evaluating Parent's financial condition
38
shall be the same after such change as if such change had not been made;
provided, however, the parties hereto agree to construe all terms of an
accounting or financial nature in accordance with GAAP as in effect prior to any
such change in accounting principles until the parties hereto have amended the
applicable provisions of this Agreement.
1.3 CODE. Any terms used in this Agreement that are defined in the
Code shall be construed and defined as set forth in the Code unless otherwise
defined herein.
1.4 CONSTRUCTION. Unless the context of this Agreement or any
other Loan Document clearly requires otherwise, references to the plural include
the singular, references to the singular include the plural, the term
"including" is not limiting, and the term "or" has, except where otherwise
indicated, the inclusive meaning represented by the phrase "and/or." The words
"hereof," "herein," "hereby," "hereunder," and similar terms in this Agreement
or any other Loan Document refer to this Agreement or such other Loan Document,
as the case may be, as a whole and not to any particular provision of this
Agreement or such other Loan Document, as the case may be. Section, subsection,
clause, schedule, and exhibit references herein are to this Agreement unless
otherwise specified. Any reference in this Agreement or in the other Loan
Documents to any agreement, instrument, or document shall include all
alterations, amendments, changes, extensions, modifications, renewals,
replacements, substitutions, joinders, and supplements, thereto and thereof, as
applicable (subject to any restrictions on such alterations, amendments,
changes, extensions, modifications, renewals, replacements, substitutions,
joinders, and supplements set forth herein). Any reference herein to the
repayment in full of the Obligations shall mean the repayment in full in cash of
all Obligations other than contingent indemnification Obligations and any other
Bank Product Obligations that at such time are allowed by the applicable Bank
Product Provider to remain outstanding and are not required to be repaid or cash
collateralized pursuant to the provisions of this Agreement. Any reference
herein to any Person shall be construed to include such Person's successors and
assigns. Any requirement of a writing contained herein or in the other Loan
Documents shall be satisfied by the transmission of a Record and any Record
transmitted shall constitute a representation and warranty as to the accuracy
and completeness of the information contained therein.
1.5 SCHEDULES AND EXHIBITS. All of the schedules and exhibits
attached to this Agreement, together with any amendments, restatements,
supplements, or other modifications to such schedules and exhibits permitted
hereunder shall be deemed incorporated herein by reference.
2. LOAN AND TERMS OF PAYMENT.
2.1 REVOLVER ADVANCES.
(a) Subject to the terms and conditions of this Agreement
and relying upon the representations and warranties set forth herein, and during
the term of this Agreement, each Lender with a Revolver Commitment agrees
(severally, not jointly or jointly and severally) to make advances ("Advances")
to Borrowers in an amount at any one time outstanding not to exceed such
Lender's Pro Rata Share of an amount equal to the lesser of (i) the Maximum
Revolver Amount less the Letter of Credit Usage, or (ii) the Borrowing Base less
the Letter of Credit Usage less the outstanding balance of the Term Loan.
39
(b) Anything to the contrary in this Section 2.1
notwithstanding, Agent shall have the right to establish reserves in such
amounts, and with respect to such matters, as Agent in its Permitted Discretion
shall deem necessary or appropriate, against the Borrowing Base, including
reserves with respect to (i) sums that Borrowers are required to pay (such as
taxes, assessments, insurance premiums, or, in the case of leased assets, rents
or other amounts payable under such leases) and have failed to pay in accordance
with the terms of any Section of this Agreement or any other Loan Document, (ii)
amounts required to be paid to any Governmental Authority for mortgage, stamp or
other documentary taxes with respect to any Mortgage delivered pursuant to this
Agreement, and (iii) amounts owing by Borrowers or their Subsidiaries to any
Person to the extent secured by a Lien on, or trust over, any of the Collateral,
which Lien or trust, in the Permitted Discretion of Agent likely would have a
priority superior to the Agent's Liens (such as Liens or trusts in favor of
landlords, warehousemen, carriers, mechanics, materialmen, laborers, or
suppliers, or Liens or trusts for ad valorem, excise, sales, or other taxes
where given priority under Applicable Laws) in and to such item of the
Collateral; provided, however, the amount of any such reserve established by
Agent in its Permitted Discretion after the Closing Date shall only be reduced
with the consent of the Required Lenders.
(c) The Lenders with Revolver Commitments shall have no
obligation to make additional Advances hereunder to the extent such additional
Advances would cause the Revolver Usage to exceed the Maximum Revolver Amount.
(d) Amounts borrowed pursuant to this Section may be
repaid and, subject to the terms and conditions of this Agreement, reborrowed at
any time during the term of this Agreement.
2.2 TERM LOAN.
(a) Subject to the terms and conditions of this
Agreement, on the Closing Date each Lender with a Term Loan Commitment agrees
(severally, not jointly or jointly and severally) to make term loans
(collectively, the "Term Loan") to Borrowers in an amount equal to such Lender's
Pro Rata Share of an amount equal to the lesser of (i) the Term Loan Amount, or
(ii) the Borrowing Base less the Revolver Usage as of such date. The Term Loan
shall be repaid in equal monthly principal payments in the amount of $291,667,
commencing on April 1, 2004 and continuing on the first Business Day of each
month thereafter. Amounts borrowed and repaid pursuant to this Section may not
be reborrowed.
(b) The outstanding unpaid principal balance and all
accrued and unpaid interest under the Term Loan shall be due and payable on the
date of termination of this Agreement, whether by its terms, by prepayment, or
by acceleration. All amounts outstanding under the Term Loan shall constitute
Obligations.
2.3 BORROWING PROCEDURES AND SETTLEMENTS.
(a) PROCEDURE FOR BORROWING. Each Borrowing shall be made
by an irrevocable written request by an Authorized Person delivered to Agent
(which notice must be received by Agent no later than 10:00 a.m. (California
time) on the Business Day prior to the date that is the requested Funding Date
specifying (i) the amount of such Borrowing, and (ii)
40
the requested Funding Date, which shall be a Business Day; provided, however,
that in the case of a request for Swing Loan in an amount of $1,000,000, or
less, such notice will be timely received if it is received by Agent no later
than 10:00 a.m. (California time) on the Business Day that is the requested
Funding Date. At Agent's election, in lieu of delivering the above-described
written request, any Authorized Person may give Agent telephonic notice of such
request by the required time, with such telephonic notice to be confirmed in
writing within 24 hours of the giving of such notice and the failure to provide
such written confirmation shall not affect the validity of the request. Upon the
making of any request for a Borrowing hereunder, Borrowers shall be deemed to
have certified that all conditions set forth in Section 3.3 hereof have been
satisfied.
(b) AGENT'S ELECTION. Promptly after receipt of a request
for a Borrowing pursuant to Section 2.3(a), Agent shall elect, in its
discretion, (i) to have the terms of Section 2.3(c) apply to such requested
Borrowing, or (ii) if the Borrowing is for an Advance, to request Swing Lender
to make a Swing Loan pursuant to the terms of Section 2.3(d) in the amount of
the requested Borrowing; provided, however, that if Swing Lender declines in its
sole discretion to make a Swing Loan pursuant to Section 2.3(d), Agent shall
elect to have the terms of Section 2.3(c) apply to such requested Borrowing.
(c) MAKING OF ADVANCES.
(i) In the event that Agent shall elect to have
the terms of this Section 2.3(c) apply to a requested
Borrowing as described in Section 2.3(b), then promptly after
receipt of a request for a Borrowing pursuant to Section
2.3(a), Agent shall notify the Lenders, not later than 1:00
p.m. (California time) on the Business Day immediately
preceding the Funding Date applicable thereto by telecopy,
telephone, or other similar form of transmission, of the
requested Borrowing. Each Lender shall make the amount of such
Lender's Pro Rata Share of the requested Borrowing available
to Agent in immediately available funds, to Agent's Account,
not later than 10:00 a.m. (California time) on the Funding
Date applicable thereto. After Agent's receipt of the proceeds
of such Advances (or the Term Loan, as applicable), upon
satisfaction of the applicable conditions precedent set forth
in Section 3 hereof, Agent shall make the proceeds thereof
available to Administrative Borrower on the applicable Funding
Date by transferring immediately available funds equal to such
proceeds received by Agent to Administrative Borrower's
Designated Account; provided, however, that, subject to the
provisions of Section 2.3(i), Agent shall not request any
Lender to make, and no Lender shall have the obligation to
make, any Advance (or its portion of the Term Loan) if Agent
shall have actual knowledge that (1) one or more of the
applicable conditions precedent set forth in Section 3 will
not be satisfied on the requested Funding Date for the
applicable Borrowing unless such condition has been waived, or
(2) the requested Borrowing would exceed the Availability on
such Funding Date.
(ii) Unless Agent receives notice from a Lender
on or prior to the Closing Date or, with respect to any
Borrowing after the Closing Date, prior to 9:00 a.m.
(California time) on the date of such Borrowing, that such
Lender will not make available as and when required hereunder
to Agent for the account of
41
Borrowers the amount of that Lender's Pro Rata Share of the
Borrowing, Agent may assume that each Lender has made or will
make such amount available to Agent in immediately available
funds on the Funding Date and Agent may (but shall not be so
required), in reliance upon such assumption, make available to
Borrowers on such date a corresponding amount. If and to the
extent any Lender shall not have made its full amount
available to Agent in immediately available funds and Agent in
such circumstances has made available to Borrowers such
amount, that Defaulting Lender shall on the Business Day
following such Funding Date make such amount available to
Agent, together with interest at the Defaulting Lender Rate
for each day during such period. A notice submitted by Agent
to any Lender with respect to amounts owing under this
subsection shall be conclusive, absent manifest error. If such
amount is so made available, such payment to Agent shall
constitute such Lender's Advance (or portion of the Term Loan,
as applicable) on the date of Borrowing for all purposes of
this Agreement. If such amount is not made available to Agent
on the Business Day following the Funding Date, Agent will
notify Administrative Borrower of such failure to fund and,
upon demand by Agent, Borrowers shall pay such amount to Agent
for Agent's account, together with interest thereon for each
day elapsed since the date of such Borrowing, at a rate per
annum equal to the interest rate applicable at the time to the
Advances (or portion of the Term Loan, as applicable)
composing such Borrowing. The failure of any Lender to make
any Advance (or portion of the Term Loan, as applicable) on
any Funding Date shall not relieve any other Lender of any
obligation hereunder to make an Advance (or portion of the
Term Loan, as applicable) on such Funding Date, but no Lender
shall be responsible for the failure of any other Lender to
make the Advance to be made by such other Lender on any
Funding Date.
(iii) Agent shall not be obligated to transfer to
a Defaulting Lender any payments made by Borrowers to Agent
for the Defaulting Lender's benefit, and, in the absence of
such transfer to the Defaulting Lender, Agent shall transfer
any such payments to each other non-Defaulting Lender member
of the Lender Group ratably in accordance with their
Commitments (but only to the extent that such Defaulting
Lender's Advance was funded by the other members of the Lender
Group) or, if so directed by Administrative Borrower and if no
Default or Event of Default shall have occurred and be
continuing (and to the extent such Defaulting Lender's Advance
was not funded by the Lender Group), retain the same to be
re-advanced to Borrowers as if such Defaulting Lender had made
Advances to Borrowers. Subject to the foregoing, Agent may
hold and, in its Permitted Discretion, re-lend to Borrowers
for the account of such Defaulting Lender the amount of all
such payments received and retained by Agent for the account
of such Defaulting Lender. Solely for the purposes of voting
or consenting to matters with respect to the Loan Documents,
such Defaulting Lender shall be deemed not to be a "Lender"
and such Lender's Commitment shall be deemed to be zero. This
Section shall remain effective with respect to such Lender
until (x) the Obligations under this Agreement shall have been
declared or shall have become immediately due and payable, (y)
the non-Defaulting Lenders, Agent, and Administrative Borrower
shall have waived such
42
Defaulting Lender's default in writing, or (z) the Defaulting
Lender makes its Pro Rata Share of the applicable Advance and
pays to Agent all amounts owing by Defaulting Lender in
respect thereof. The operation of this Section shall not be
construed to increase or otherwise affect the Commitment of
any Lender, to relieve or excuse the performance by such
Defaulting Lender or any other Lender of its duties and
obligations hereunder, or to relieve or excuse the performance
by Borrowers of their duties and obligations hereunder to
Agent or to the Lenders other than such Defaulting Lender. Any
such failure to fund by any Defaulting Lender shall constitute
a material breach by such Defaulting Lender of this Agreement
and shall entitle Administrative Borrower at its option, upon
written notice to Agent, to arrange for a substitute Lender to
assume the Commitment of such Defaulting Lender, such
substitute Lender to be acceptable to Agent. In connection
with the arrangement of such a substitute Lender, the
Defaulting Lender shall have no right to refuse to be replaced
hereunder, and agrees to execute and deliver a completed form
of Assignment and Acceptance in favor of the substitute Lender
(and agrees that it shall be deemed to have executed and
delivered such document if it fails to do so) subject only to
being repaid its share of the outstanding Obligations (other
than Bank Product Obligations) (including an assumption of its
Pro Rata Share of the Risk Participation Liability) without
any premium or penalty of any kind whatsoever; provided
further, however, that any such assumption of the Commitment
of such Defaulting Lender shall not be deemed to constitute a
waiver of any of the Lender Groups' or Borrowers' rights or
remedies against any such Defaulting Lender arising out of or
in relation to such failure to fund.
(d) MAKING OF SWING LOANS.
(i) In the event Agent shall elect, with the
consent of Swing Lender, as a Lender, to have the terms of
this Section 2.3(d) apply to a requested Borrowing as
described in Section 2.3(b), Swing Lender as a Lender shall
make such Advance in the amount of such Borrowing (any such
Advance made solely by Swing Lender as a Lender pursuant to
this Section 2.3(d) being referred to as a "Swing Loan" and
such Advances being referred to collectively as "Swing Loans")
available to Borrowers on the Funding Date applicable thereto
by transferring immediately available funds to Administrative
Borrower's Designated Account. Each Swing Loan shall be deemed
to be an Advance hereunder and shall be subject to all the
terms and conditions applicable to other Advances, except that
no such Swing Loan shall be eligible for the LIBOR Option and
all payments on any Swing Loan shall be payable to Swing
Lender as a Lender solely for its own account (and for the
account of the holder of any participation interest with
respect to such Swing Loan). Subject to the provisions of
Section 2.3(i), Agent shall not request Swing Lender, as a
Lender, to make, and Swing Lender as a Lender shall not make,
any Swing Loan if Agent has actual knowledge that (i) one or
more of the applicable conditions precedent set forth in
Section 3 will not be satisfied on the requested Funding Date
for the applicable Borrowing unless such condition has been
waived, or (ii) the requested Borrowing would exceed the
Availability on such Funding Date. Swing Lender as a Lender
43
shall not otherwise be required to determine whether the
applicable conditions precedent set forth in Section 3 have
been satisfied on the Funding Date applicable thereto prior to
making, in its sole discretion, any Swing Loan.
(ii) The Swing Loans shall be secured by the
Agent's Liens, shall constitute Obligations hereunder, and
shall bear interest at the rate applicable from time to time
to Advances that are Base Rate Loans.
(e) AGENT ADVANCES.
(i) Agent is hereby authorized by Borrowers and
the Lenders, from time to time in Agent's sole discretion, (1)
after the occurrence and during the continuance of a Default
or an Event of Default, or (2) at any time that any of the
other applicable conditions precedent set forth in Section 3
have not been satisfied, to make Advances to Borrowers on
behalf of the Lenders that Agent, in its Permitted Discretion
deems necessary or desirable (A) to preserve or protect the
Collateral, or any portion thereof, (B) to enhance the
likelihood of repayment of the Obligations (other than the
Bank Product Obligations), or (C) to pay any other amount
chargeable to Borrowers pursuant to the terms of this
Agreement, including Lender Group Expenses and the costs,
fees, and expenses described in Section 10 (any of the
Advances described in this Section 2.3(e) shall be referred to
as "Agent Advances"), provided, that notwithstanding anything
to the contrary contained in this Section 2.3(e), the
aggregate principal amount of Agent Advances outstanding at
any one time, when taken together with the aggregate principal
amount of Overadvances made in accordance with Section 2.3(i)
outstanding at any time, shall not exceed an amount equal to
the lesser of (x) 5.0% of the Borrowing Base then in effect
and (y) $10,000,000. Each Agent Advance shall be deemed to be
an Advance hereunder and shall be subject to all the terms and
conditions applicable to other Advances, except that no such
Agent Advance shall be eligible for the LIBOR Option and all
payments thereon shall be payable to Agent solely for its own
account (and for the account of the holder of any
participation interest with respect to such Agent Advances).
(ii) The Agent Advances shall be repayable on
demand and secured by the Agent's Liens granted to Agent under
the Loan Documents, shall constitute Advances and Obligations
hereunder, and shall bear interest at the rate applicable from
time to time to Advances that are Base Rate Loans.
(f) SETTLEMENT. It is agreed that each Lender's funded
portion of the Advances is intended by the Lenders to equal, at all times, such
Lender's Pro Rata Share of the outstanding Advances. Such agreement
notwithstanding, Agent, Swing Lender, and the other Lenders agree (which
agreement shall not be for the benefit of or enforceable by Borrowers) that in
order to facilitate the administration of this Agreement and the other Loan
Documents, settlement among them as to the Advances, the Swing Loans, and the
Agent Advances shall take place on a periodic basis in accordance with the
following provisions:
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(i) Agent shall request settlement
("Settlement") with the Lenders on a weekly basis, or on a
more frequent basis if so determined by Agent, (1) on behalf
of Swing Lender, with respect to each outstanding Swing Loan,
(2) for itself, with respect to each Agent Advance, and (3)
with respect to Borrowers' or their Subsidiaries' Collections
received, as to each by notifying the Lenders by telecopy,
telephone, or other similar form of transmission, of such
requested Settlement, no later than 2:00 p.m. (California
time) on the Business Day immediately prior to the date of
such requested Settlement (the date of such requested
Settlement being the "Settlement Date"). Such notice of a
Settlement Date shall include a summary statement of the
amount of outstanding Advances (including Swing Loans and
Agent Advances) for the period since the prior Settlement
Date. Subject to the terms and conditions contained herein
(including Section 2.3(c)(iii)): (y) if a Lender's balance of
the Advances (including Swing Loans and Agent Advances)
exceeds such Lender's Pro Rata Share of the Advances
(including Swing Loans and Agent Advances) as of a Settlement
Date, then Agent shall, by no later than 12:00 p.m.
(California time) on the Settlement Date, transfer in
immediately available funds to a Deposit Account of such
Lender (as such Lender may designate) an amount such that each
such Lender shall, upon receipt of such amount, have as of the
Settlement Date, its Pro Rata Share of the Advances (including
Swing Loans and Agent Advances), and (z) if a Lender's balance
of the Advances, Swing Loans, and Agent Advances is less than
such Lender's Pro Rata Share of the Advances (including Swing
Loans and Agent Advances) as of a Settlement Date, such Lender
shall no later than 12:00 p.m. (California time) on the
Settlement Date transfer in immediately available funds to the
Agent's Account, an amount such that each such Lender shall,
upon transfer of such amount, have as of the Settlement Date,
its Pro Rata Share of the Advances (including Swing Loans and
Agent Advances). Such amounts made available to Agent under
clause (z) of the immediately preceding sentence shall be
applied against the amounts of the applicable Swing Loan or
Agent Advance and, together with the portion of such Swing
Loan or Agent Advance representing Swing Lender's Pro Rata
Share thereof, shall constitute Advances of such Lenders. If
any such amount is not made available to Agent by any Lender
on the Settlement Date applicable thereto to the extent
required by the terms hereof, Agent shall be entitled to
recover for its account such amount on demand from such Lender
together with interest thereon at the Defaulting Lender Rate.
(ii) In determining whether a Lender's balance of
the Advances, Swing Loans, and Agent Advances is less than,
equal to, or greater than such Lender's Pro Rata Share of the
Advances, Swing Loans, and Agent Advances as of a Settlement
Date, Agent shall, as part of the relevant Settlement, apply
to such balance the portion of payments actually received in
good funds by Agent with respect to principal, interest, and
fees payable by Borrowers and allocable to the Lenders
hereunder, and proceeds of Collateral. To the extent that a
net amount is owed to any such Lender after such application,
such net amount shall be distributed by Agent to that Lender
as part of such next Settlement.
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(iii) Between Settlement Dates, Agent, to the
extent no Agent Advances or Swing Loans are outstanding, may
pay over to Swing Lender any payments received by Agent, that
in accordance with the terms of this Agreement would be
applied to the reduction of the Advances, for application to
Swing Lender's Pro Rata Share of the Advances. If, as of any
Settlement Date, Collections of Borrowers or their
Subsidiaries received since the then immediately preceding
Settlement Date have been applied to Swing Lender's Pro Rata
Share of the Advances other than to Swing Loans, as provided
for in the previous sentence, Swing Lender shall pay to Agent
for the accounts of the Lenders, and Agent shall pay to the
Lenders, to be applied to the outstanding Advances of such
Lenders, an amount such that each Lender shall, upon receipt
of such amount, have, as of such Settlement Date, its Pro Rata
Share of the Advances. During the period between Settlement
Dates, Swing Lender with respect to Swing Loans, Agent with
respect to Agent Advances, and each Lender (subject to the
effect of letter agreements between Agent and individual
Lenders) with respect to the Advances other than Swing Loans
and Agent Advances, shall be entitled to interest at the
applicable rate or rates payable under this Agreement on the
daily amount of funds employed by Swing Lender, Agent, or the
Lenders, as applicable.
(g) NOTATION. As more fully set forth in Section 2.16 and
Section 14.1(h) Agent shall record on its books the principal amount of the
Advances (or portion of the Term Loan, as applicable) owing to each Lender,
including the Swing Loans owing to Swing Lender, and Agent Advances owing to
Agent, and the interests therein of each Lender, from time to time and such
records shall, absent manifest error, conclusively be presumed to be correct and
accurate. In addition, each Lender is authorized, at such Lender's option, to
note the date and amount of each payment or prepayment of principal of such
Lender's Advances (or portion of Term Loan, as applicable) in its books and
records, including computer records and such records shall, absent manifest
error, conclusively be presumed to be correct and accurate.
(h) LENDERS' FAILURE TO PERFORM. All Advances (other than
Swing Loans and Agent Advances) shall be made by the Lenders contemporaneously
and in accordance with their Pro Rata Shares. It is understood that (i) no
Lender shall be responsible for any failure by any other Lender to perform its
obligation to make any Advance (or other extension of credit) hereunder, nor
shall any Commitment of any Lender be increased or decreased as a result of any
failure by any other Lender to perform its obligations hereunder, and (ii) no
failure by any Lender to perform its obligations hereunder shall excuse any
other Lender from its obligations hereunder.
(i) OPTIONAL OVERADVANCES. Any contrary provision of this
Agreement notwithstanding, the Lenders hereby authorize Agent or Swing Lender,
as applicable, and Agent or Swing Lender, as applicable, may, but is not
obligated to, knowingly and intentionally, continue to make Advances to
Borrowers notwithstanding that an Overadvance exists or thereby would be
created, so long as (i) after giving effect to such Advances, the sum of the
outstanding Revolver Usage and the outstanding principal amount of the Term Loan
does not exceed the Borrowing Base by an amount equal to the lesser of (x) 5.0%
of the Borrowing Base and (y) $10,000,000, (ii) after giving effect to such
Advances the outstanding Revolver Usage (except
46
for and excluding amounts charged to the Loan Account for interest, fees, or
Lender Group Expenses) does not exceed the Maximum Revolver Amount, (iii) the
aggregate principal amount of Overadvances made pursuant to this Section 2.3(i)
when taken together with the aggregate principal amount of Agent Advances made
pursuant to Section 2.3(e) does not exceed at any time an amount equal to the
lesser of (x) 5.0% of the Borrowing Base then in effect and (y) $10,000,000, and
(iv) at the time of the making of any such Advance (including a Swing Loan),
Agent does not believe, in good faith, that the Overadvance created by such
Advance will be outstanding for more than 90 days. The foregoing provisions are
for the exclusive benefit of Agent, Swing Lender, and the Lenders and are not
intended to benefit Borrowers in any way. The Advances and Swing Loans, as
applicable, that are made pursuant to this Section 2.3(i) shall be subject to
the same terms and conditions as any other Advance or Swing Loan, as applicable,
except that they shall not be eligible for the LIBOR Option and the rate of
interest applicable thereto shall be the rate applicable to Advances that are
Base Rate Loans under Section 2.6(c) hereof without regard to the presence or
absence of a Default or Event of Default.
(i) In the event Agent obtains actual knowledge
that the Revolver Usage exceeds the amounts permitted by the
preceding paragraph, regardless of the amount of, or reason
for, such excess, Agent shall notify Lenders as soon as
practicable (and prior to making any (or any additional)
intentional Overadvances (except for and excluding amounts
charged to the Loan Account for interest, fees, or Lender
Group Expenses) unless Agent determines that prior notice
would result in imminent harm to the Collateral or its value),
and the Lenders with Revolver Commitments thereupon shall,
together with Agent, jointly determine the terms of
arrangements that shall be implemented with Borrowers and
intended to reduce, within a reasonable time, the outstanding
principal amount of the Advances to Borrowers to an amount
permitted by the preceding paragraph. In the event Agent or
any Lender disagrees over the terms of reduction or repayment
of any Overadvance, the terms of reduction or repayment
thereof shall be implemented according to the determination of
the Required Lenders.
(ii) Each Lender with a Revolver Commitment shall
be obligated to settle with Agent as provided in Section
2.3(f) for the amount of such Lender's Pro Rata Share of any
unintentional Overadvances by Agent reported to such Lender,
any intentional Overadvances made as permitted under this
Section 2.3(i), and any Overadvances resulting from the
charging to the Loan Account of interest, fees, or Lender
Group Expenses.
2.4 PAYMENTS.
(a) PAYMENTS BY BORROWERS.
(i) Except as otherwise expressly provided
herein, all payments by Borrowers shall be made to Agent's
Account for the account of the Lender Group and shall be made
in immediately available funds, no later than 11:00 a.m.
(California time) on the date specified herein. Except as
otherwise provided in paragraph (b)(iii) below, any payment
received by Agent later than 11:00 a.m. (California time),
shall be deemed to have been received on the following
47
Business Day and any applicable interest or fee shall continue
to accrue until such following Business Day.
(ii) Unless Agent receives notice from
Administrative Borrower prior to the date on which any payment
is due to the Lenders that Borrowers will not make such
payment in full as and when required, Agent may assume that
Borrowers have made (or will make) such payment in full to
Agent on such date in immediately available funds and Agent
may (but shall not be so required), in reliance upon such
assumption, distribute to each Lender on such due date an
amount equal to the amount then due such Lender. If and to the
extent Borrowers do not make such payment in full to Agent on
the date when due, each Lender severally shall repay to Agent
on demand such amount distributed to such Lender, together
with interest thereon at the Defaulting Lender Rate for each
day from the date such amount is distributed to such Lender
until the date repaid.
(b) APPORTIONMENT AND APPLICATION OF PAYMENTS.
(i) Except as otherwise provided with respect to
Defaulting Lenders and except as otherwise provided in the
Loan Documents (including any letter agreements between Agent
and individual Lenders), aggregate principal and interest
payments shall be apportioned ratably among the Lenders
(according to the unpaid principal balance of the Obligations
to which such payments relate held by each Lender) and
payments of fees and expenses (other than fees or expenses
that are for Agent's separate account, after giving effect to
any letter agreements between Agent and individual Lenders)
shall be apportioned ratably among the Lenders having a Pro
Rata Share of the type of Commitment or Obligation to which a
particular fee relates. All payments shall be remitted to
Agent and all such payments, and all proceeds of any Loan
Party's Accounts, or Collateral received by Agent, shall be
applied as follows:
(A) first, to pay any Lender Group
Expenses then due to Agent under the Loan Documents,
until paid in full,
(B) second, to pay any Lender Group
Expenses then due to the Lenders under the Loan
Documents, on a ratable basis, until paid in full,
(C) third, to pay any fees then due to
Agent (for its separate accounts, after giving effect
to any letter agreements between Agent and the
individual Lenders) under the Loan Documents until
paid in full,
(D) fourth, to pay any fees then due to
any or all of the Lenders (after giving effect to any
letter agreements between Agent and individual
Lenders) under the Loan Documents, on a ratable
basis, until paid in full,
(E) fifth, to pay interest due in
respect of all Agent Advances, until paid in full,
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(F) sixth, ratably to pay interest due
in respect of the Advances (other than Agent
Advances), the Swing Loans, and the Term Loan until
paid in full,
(G) seventh, to pay the principal of all
Agent Advances until paid in full,
(H) eighth, so long as no Enforcement
Event exists, ratably to pay all principal amounts
then due and payable (other than as a result of an
acceleration thereof) with respect to the Term Loan
until paid in full,
(I) ninth, to pay the principal of all
Swing Loans until paid in full,
(J) tenth, so long as no Enforcement
Event exists, and at Agent's election (which election
Agent agrees will not be made if an Overadvance would
be created thereby), to pay amounts then due and
owing by Administrative Borrower or its Subsidiaries
in respect of Bank Products in an amount up to the
amount of the Bank Product Reserves, until paid in
full,
(K) eleventh, so long as no Enforcement
Event exists, to pay the principal of all Advances
until paid in full,
(L) twelfth, if an Enforcement Event
exists, ratably (i) to pay the principal amount of
all Advances until paid in full, (ii) to Agent, to be
held by Agent, for the ratable benefit of Issuing
Lender and those Lenders having a Revolver
Commitment, as cash collateral in an amount up to
105% of the then extant Letter of Credit Usage until
paid in full, and (iii) to pay the outstanding
principal balance of the Term Loan until the Term
Loan is paid in full,
(M) thirteenth, if an Enforcement Event
exists, to Agent, to be held by Agent for the benefit
of the Bank Product Providers, as cash collateral in
an amount up to the amount of the Bank Product
Reserve established prior to the occurrence of, and
not in contemplation of, the subject Event of Default
until Administrative Borrower's and its Subsidiaries'
obligations in respect of the then extant Bank
Products have been paid in full or the cash
collateral amount has been exhausted,
(N) fourteenth, if an Enforcement Event
exists, to pay any other Obligations (including Bank
Product Obligations) until paid in full, and
(O) fifteenth, to Borrowers (to be wired
to the Designated Account) or such other Person
entitled thereto under the Term Loan B Intercreditor
Agreement or Applicable Laws.
49
(ii) Agent promptly shall distribute to each
Lender, pursuant to the applicable wire instructions received
from each Lender in writing, such funds as it may be entitled
to receive, subject to a Settlement delay as provided in
Section 2.3(h).
(iii) In each instance, so long as no Event of
Default has occurred and is continuing, Section 2.4(b) shall
not be deemed to apply to any payment by Borrowers specified
by Borrowers to be for the payment of specific Obligations
then due and payable (or prepayable) under any provision of
this Agreement.
(iv) For purposes of the foregoing, "paid in
full" means payment in cash of all amounts owing under the
Loan Documents according to the terms thereof, including loan
fees, service fees, professional fees, interest (and
specifically including interest accrued after the commencement
of any Insolvency Proceeding), default interest, interest on
interest, and expense reimbursements, whether or not the same
would be or is allowed or disallowed in whole or in part in
any Insolvency Proceeding.
(v) In the event of a direct conflict between
the priority provisions of this Section 2.4 and other
provisions contained in any other Loan Document, it is the
intention of the parties hereto that such priority provisions
in such documents shall be read together and construed, to the
fullest extent possible, to be in concert with each other. In
the event of any actual, irreconcilable conflict that cannot
be resolved as aforesaid, the terms and provisions of this
Section 2.4 shall control and govern.
2.5 OVERADVANCES. If, at any time or for any reason, the amount of
Obligations (other than Bank Product Obligations) owed by Borrowers to the
Lender Group pursuant to Sections 2.1 and 2.12 is greater than either the Dollar
or percentage limitations set forth in Sections 2.1 or 2.12 (an "Overadvance"),
Borrowers immediately shall pay to Agent, in cash, the amount of such excess,
which amount shall be used by Agent to reduce the Obligations in accordance with
the priorities set forth in Section 2.4(b). In addition, Borrowers hereby
promise to pay the Obligations (including principal, interest, fees, costs, and
expenses) in Dollars in full to the Lender Group as and when due and payable
under the terms of this Agreement and the other Loan Documents.
2.6 INTEREST RATES AND LETTER OF CREDIT FEE: RATES, PAYMENTS, AND
CALCULATIONS.
(a) INTEREST RATES. Except as provided in clause (c)
below, all Obligations (except for undrawn Letters of Credit and except for Bank
Product Obligations) that have been charged to the Loan Account pursuant to the
terms hereof shall bear interest on the Daily Balance thereof as follows (i) if
the relevant Obligation is an Advance that is a LIBOR Rate Loan, at a per annum
rate equal to the LIBOR Rate plus the Applicable Margin, (ii) if the relevant
Obligation is a portion of the Term Loan that is a LIBOR Rate Loan, at a per
annum rate equal to the LIBOR Rate plus the Applicable Margin, (iii) if the
relevant Obligation is a portion of the Term Loan that is a Base Rate Loan, at a
per annum rate equal to the Base Rate plus the Applicable Margin, and (iv)
otherwise, at a per annum rate equal to the Base Rate plus the
50
Application Margin. Notwithstanding any provision in this Agreement to the
contrary, (x) for the period of 3 Business Days immediately following the
Closing Date, all Advances shall be Base Rate Loans, and (y) the Term Loan shall
be a LIBOR Rate Loan at all times after the Closing Date until such time as
Agent may convert the Term Loan to a Base Rate Loan pursuant to Section 2.13(a)
upon the occurrence and during the continuation of an Event of Default.
(b) LETTER OF CREDIT FEE. Borrowers shall pay Agent (for
the ratable benefit of the Lenders with a Revolver Commitment, subject to any
letter agreement between Agent and individual Lenders), a Letter of Credit fee
(the "Letter of Credit Fee") (in addition to the charges, commissions, fees, and
costs set forth in Section 2.12(f)) which shall accrue at a rate equal to the
Applicable Margin for the Letter of Credit Fees times the Daily Balance of the
undrawn amount of all outstanding Letters of Credit as of the date of
determination.
(c) DEFAULT RATE. Upon the occurrence and during the
continuation of an Event of Default (and at the election of Agent or the
Required Lenders),
(i) all Obligations (except for undrawn Letters
of Credit and except for Bank Product Obligations) that have
been charged to the Loan Account pursuant to the terms hereof
shall bear interest on the Daily Balance thereof at a per
annum rate equal to 2.00 percentage points above the per annum
rate otherwise applicable hereunder (the "Default Rate"), and
(ii) the Letter of Credit fee provided for above
shall be increased to 2.00 percentage points above the per
annum rate otherwise applicable hereunder.
(d) PAYMENT. Interest (other than interest on LIBOR Rate
Loans), Letter of Credit fees, and all other fees payable hereunder shall be due
and payable, in arrears, on the first Business Day of each month at any time
that Obligations or Commitments are outstanding. Borrowers hereby authorize
Agent, from time to time, without prior notice to Borrowers, to charge all
interest and fees, all Lender Group Expenses (as and when incurred), the
charges, commissions, fees, and costs provided for in Section 2.12(f) (as and
when accrued or incurred), the fees and costs provided for in Section 2.11 (as
and when accrued or incurred), and all other payments as and when due and
payable under any Loan Document (including the installments due and payable with
respect to the Term Loan and including any amounts due and payable to Bank
Product Providers in respect of Bank Products up to the amount of the then
extant Bank Product Reserve) to Borrowers' Loan Account, which amounts
thereafter shall constitute Advances hereunder and shall accrue interest at the
rate then applicable to Advances hereunder. Any interest not paid when due shall
be compounded by being charged to Borrowers' Loan Account and shall thereafter
constitute Advances hereunder and shall accrue interest at the rate then
applicable to Advances that are Base Rate Loans hereunder.
(e) COMPUTATION. All interest and fees chargeable under
the Loan Documents shall be computed on the basis of a 360 day year for the
actual number of days elapsed. In the event the Base Rate is changed from time
to time hereafter, the rates of interest hereunder based upon the Base Rate
automatically and immediately shall be increased or decreased by an amount equal
to such change in the Base Rate.
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(f) INTENT TO LIMIT CHARGES TO MAXIMUM LAWFUL RATE. In no
event shall the interest rate or rates payable under this Agreement, plus any
other amounts paid in connection herewith, exceed the highest rate permissible
under any law that a court of competent jurisdiction shall, in a final
determination, deem applicable. Borrowers and the Lender Group, in executing and
delivering this Agreement, intend legally to agree upon the rate or rates of
interest and manner of payment stated within it; provided, however, that,
anything contained herein to the contrary notwithstanding, if said rate or rates
of interest or manner of payment exceeds the maximum allowable under Applicable
Laws, then, ipso facto, as of the date of this Agreement, Borrowers are and
shall be liable only for the payment of such maximum as allowed by law, and
payment received from Borrowers in excess of such legal maximum, whenever
received, shall be applied to reduce the principal balance of the Obligations to
the extent of such excess.
2.7 CASH MANAGEMENT.
(a) Borrowers shall, and shall cause each of the
Guarantors to, (i) establish and maintain cash management services of a type and
on terms satisfactory to Agent at one or more of the banks set forth on Schedule
2.7(a) (each, a "Cash Management Bank"), and shall immediately after the Closing
Date request in writing and otherwise take such reasonable steps to ensure that
all of their Account Debtors forward payment of the amounts owed by them
directly to such Cash Management Bank, and (ii) deposit or cause to be deposited
promptly, and in any event no later than the first Business Day after the date
of receipt thereof, all Collections (including those sent directly by their
Account Debtors to a Cash Management Bank or Collections received at a retail
location of any Borrower or any Guarantor) into a bank account in Agent's name
(a "Cash Management Account") at one of the Cash Management Banks.
Notwithstanding any other provision to the contrary, the New AMERCO Notes
Accounts shall not be deemed to be Cash Management Accounts.
(b) The Cash Management Bank maintaining the
Concentration Account and such other Cash Management Banks as may be required by
Agent shall establish and maintain Cash Management Agreements with Agent and
Borrowers, in form and substance acceptable to Agent. Each such Cash Management
Agreement shall provide, among other things, that (i) all items of payment
deposited in such Cash Management Account and proceeds thereof are held by such
Cash Management Bank as agent or bailee-in-possession for Agent, (ii) the Cash
Management Bank has no rights of setoff or recoupment or any other claim against
the applicable Cash Management Account, other than for payment of its service
fees and other charges directly related to the administration of such Cash
Management Account and for returned checks or other items of payment, and (iii)
it immediately will forward by daily sweep all amounts in the applicable Cash
Management Account to the Concentration Account. Upon the occurrence of an Event
of Default and in accordance with the terms of and subject to the conditions set
forth in the Cash Management Agreement applicable to the Concentration Account,
all amounts received in the Concentration Account shall be swept into the
Agent's Account.
(c) So long as no Default or Event of Default has
occurred and is continuing, Administrative Borrower may amend Schedule 2.7(a) to
add or replace a Cash Management Account Bank or Cash Management Account;
provided, however, that (i) such prospective Cash Management Bank shall be
reasonably satisfactory to Agent and Agent shall have consented in
52
writing in advance to the opening of such Cash Management Account with the
prospective Cash Management Bank, and (ii) prior to the time of the opening of
such Cash Management Account, Borrowers or Guarantors, as applicable, and such
prospective Cash Management Bank shall have executed and delivered to Agent a
Cash Management Agreement. Borrowers or Guarantor, as applicable, shall close
any of their Cash Management Accounts (and establish replacement cash management
accounts in accordance with the foregoing sentence) promptly and in any event
within 30 days of notice from Agent that the creditworthiness of any Cash
Management Bank is no longer acceptable in Agent's reasonable judgment, or as
promptly as practicable and in any event within 60 days of notice from Agent
that the operating performance, funds transfer, or availability procedures or
performance of the Cash Management Bank with respect to Cash Management Accounts
or Agent's liability under any Cash Management Agreement with such Cash
Management Bank is no longer acceptable in Agent's reasonable judgment.
(d) The Cash Management Accounts shall be cash collateral
accounts, with all cash, checks and similar items of payment in such accounts
securing payment of the Obligations, and in which Borrowers are hereby deemed to
have granted a Lien to Agent.
(e) The parties hereby stipulate and agree that the Loan
Parties shall be allowed to maintain those certain cash collateral accounts for
the benefit of third parties, and in the amounts, set forth on Schedule 2.7(e);
provided, however no Loan Party shall increase the amount held in any such cash
collateral account without the prior written consent of Agent.
(f) In no event shall any Loan Party deposit the proceeds
of any Collateral into any New AMERCO Note Account.
2.8 CREDITING PAYMENTS. The receipt of any payment item by Agent
(whether from transfers to Agent by the Cash Management Banks pursuant to the
Cash Management Agreements or otherwise) shall not be considered a payment on
account unless such payment item is a wire transfer of immediately available
federal funds made to the Agent's Account or unless and until such payment item
is honored when presented for payment. Should any payment item not be honored
when presented for payment, then Borrowers shall be deemed not to have made such
payment and interest shall be calculated accordingly. Anything to the contrary
contained herein notwithstanding, any payment item shall be deemed received by
Agent only if it is received into the Agent's Account on a Business Day on or
before 11:00 a.m. (California time). If any item is received into the Agent's
Account on a non-Business Day or after 11:00 a.m. (California time) on a
Business Day, it shall be deemed to have been received by Agent as of the
opening of business on the immediately following Business Day.
2.9 DESIGNATED ACCOUNT. Agent is authorized to make the Advances
and the Term Loan, and Issuing Lender is authorized to issue the Letters of
Credit, under this Agreement based upon telephonic or other instructions
received from anyone purporting to be an Authorized Person, or without
instructions if pursuant to Section 2.6(d). Administrative Borrower agrees to
establish and maintain the Designated Account with the Designated Account Bank
for the purpose of receiving the proceeds of the Advances requested by Borrowers
and made by Agent or the Lenders hereunder. Unless otherwise agreed by Agent and
Administrative Borrower, any Advance, Agent Advance, or Swing Loan requested by
Borrowers and made by Agent or the Lenders hereunder shall be made to the
Designated Account.
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2.10 MAINTENANCE OF LOAN ACCOUNT; STATEMENTS OF OBLIGATIONS. Agent
shall maintain an account on its books in the name of Borrowers (the "Loan
Account") on which Borrowers will be charged with the Term Loan, all Advances
(including Agent Advances and Swing Loans) made by Agent, Swing Lender, or the
Lenders to Borrowers or for Borrowers' account, the Letters of Credit issued by
Issuing Lender for Borrowers' account, and with all other payment Obligations
hereunder or under the other Loan Documents (except for Bank Product
Obligations), including, accrued interest, fees and expenses, and Lender Group
Expenses. In accordance with Section 2.8, the Loan Account will be credited with
all payments received by Agent from Borrowers or for Borrowers' account,
including all amounts received in the Agent's Account from any Cash Management
Bank. Agent shall render statements regarding the Loan Account to Administrative
Borrower, including principal, interest, fees, and including an itemization of
all charges and expenses constituting Lender Group Expenses owing, and such
statements, absent manifest error, shall be conclusively presumed to be correct
and accurate and constitute an account stated between Borrowers and the Lender
Group unless, within 30 days after receipt thereof by Administrative Borrower,
Administrative Borrower shall deliver to Agent written objection thereto
describing the error or errors contained in any such statements.
2.11 FEES. Borrowers shall pay to Agent the following fees and
charges, which fees and charges shall be fully earned and due and non-refundable
when paid (irrespective of whether this Agreement is terminated thereafter):
(a) UNUSED LINE FEE. On the first day of each fiscal
quarter during the term of this Agreement, an unused line fee (the "Unused Line
Fee"), for the benefit of the Lenders with a Revolver Commitment in accordance
with their Pro Rata Shares, in the amount equal to 0.50% per annum times the
result of (a) the Maximum Revolver Amount, less (b) the sum of (i) the average
Daily Balance of Advances that were outstanding during the immediately preceding
fiscal quarter, plus (ii) the average Daily Balance of the Letter of Credit
Usage during the immediately preceding fiscal quarter; provided, however, the
Unused Line Fee shall not begin to accrue until the earlier of the Closing Date
and Xxxxx 00, 0000,
(x) FEE LETTER FEES. As and when due and payable under
the terms of the Fee Letter, the fees set forth in the Fee Letter, and
(c) AUDIT, APPRAISAL, AND VALUATION CHARGES. Audit,
appraisal, and valuation fees and charges as follows, (i) a fee of $850 per day,
per auditor, plus out-of-pocket expenses for each financial audit of a Borrower
performed by personnel employed by Agent, and (ii) the actual charges paid or
incurred by Agent if it elects to employ the services of one or more third
Persons to perform financial audits of Borrowers, to appraise the Collateral, or
any portion thereof, or to assess a Borrower's business valuation.
2.12 LETTERS OF CREDIT.
(a) Subject to the terms and conditions of this
Agreement, the Issuing Lender agrees to issue letters of credit for the account
of Borrowers (each, an "L/C") or to purchase participations or execute
indemnities or reimbursement obligations (each such undertaking, an "L/C
Undertaking") with respect to letters of credit issued by an Underlying Issuer
(as of the Closing Date, the prospective Underlying Issuer is to be Xxxxx Fargo)
for the account of
54
Borrowers, including, without limitation, all Letters of Credit outstanding on
the Closing Date and issued by Xxxxx Fargo pursuant to the DIP Loan Agreement.
As of the Closing Date, all Letters of Credit (as defined therein) under the DIP
Loan Agreement are listed on Schedule 2.12 hereof, and such Letters of Credit
shall be deemed to be Letters of Credit issued and outstanding pursuant to the
terms of this Agreement. To request the issuance of an L/C or an L/C Undertaking
(or the amendment, renewal, or extension of an outstanding L/C or L/C
Undertaking), Administrative Borrower shall hand deliver or telecopy (or
transmit by electronic communication, if arrangements for doing so have been
approved by the Issuing Lender) to the Issuing Lender and Agent (reasonably in
advance of the requested date of issuance, amendment, renewal, or extension) a
notice requesting the issuance of an L/C or L/C Undertaking, or identifying the
L/C or L/C Undertaking to be amended, renewed, or extended, the date of
issuance, amendment, renewal, or extension, the date on which such L/C or L/C
Undertaking is to expire, the amount of such L/C or L/C Undertaking, the name
and address of the beneficiary thereof (or of the Underlying Letter of Credit,
as applicable), and such other information as shall be necessary to prepare,
amend, renew, or extend such L/C or L/C Undertaking. If requested by the Issuing
Lender, Borrowers also shall be an applicant under the application with respect
to any Underlying Letter of Credit that is to be the subject of an L/C
Undertaking. The Issuing Lender shall have no obligation to issue a Letter of
Credit if any of the following would result after giving effect to the requested
Letter of Credit:
(i) the Letter of Credit Usage would exceed the
Borrowing Base less the amount of outstanding Advances less
the outstanding balance of the Term Loan, or
(ii) the Letter of Credit Usage would exceed
$50,000,000, or
(iii) the Letter of Credit Usage would exceed the
Maximum Revolver Amount less the then extant amount of
outstanding Advances.
(b) Borrowers and the Lender Group acknowledge and agree
that certain Underlying Letters of Credit may be issued to support letters of
credit that already are outstanding as of the Closing Date. Each Letter of
Credit (and corresponding Underlying Letter of Credit) shall be in form and
substance acceptable to the Issuing Lender (in the exercise of its Permitted
Discretion), including the requirement that the amounts payable thereunder must
be payable in Dollars. If Issuing Lender is obligated to advance funds under a
Letter of Credit, Borrowers immediately shall reimburse such L/C Disbursement to
Issuing Lender by paying to Agent an amount equal to such L/C Disbursement not
later than 11:00 a.m. (California time), on the date that such L/C Disbursement
is made, if Administrative Borrower shall have received written or telephonic
notice of such L/C Disbursement prior to 10:00 a.m. (California time), on such
date, or, if such notice has not been received by Administrative Borrower prior
to such time on such date, then not later than 11:00 a.m. (California time), on
(i) the Business Day that Administrative Borrower receives such notice, if such
notice is received prior to 10:00 a.m. (California time), on the date of
receipt, and, in the absence of reimbursement within such time frame, the L/C
Disbursement immediately and automatically shall be deemed to be an Advance
hereunder and, thereafter, shall bear interest at the rate then applicable to
Advances that are Base Rate Loans under Section 2.6. To the extent an L/C
Disbursement is deemed to be an Advance hereunder, Borrowers' obligation to
reimburse such L/C Disbursement shall be discharged and
55
replaced by the resulting Advance. Promptly following receipt by Agent of any
payment from Borrowers pursuant to this paragraph, Agent shall distribute such
payment to the Issuing Lender or, to the extent that Lenders have made payments
pursuant to Section 2.12(c) to reimburse the Issuing Lender, then to such
Lenders and the Issuing Lender as their interest may appear.
(c) Promptly following receipt of a notice of L/C
Disbursement pursuant to Section 2.12(a), each Lender with a Revolver Commitment
agrees to fund its Pro Rata Share of any Advance deemed made pursuant to the
foregoing subsection on the same terms and conditions as if Borrowers had
requested such Advance and Agent shall promptly pay to Issuing Lender the
amounts so received by it from the Lenders. By the issuance of a Letter of
Credit (or an amendment to a Letter of Credit increasing the amount thereof) and
without any further action on the part of the Issuing Lender or the Lenders with
a Revolver Commitment, the Issuing Lender shall be deemed to have granted to
each Lender with a Revolver Commitment, and each Lender with a Revolver
Commitment shall be deemed to have purchased, a participation in each Letter of
Credit, in an amount equal to its Pro Rata Share of the Risk Participation
Liability of such Letter of Credit, and each such Lender agrees to pay to Agent,
for the account of the Issuing Lender, such Lender's Pro Rata Share of any
payments made by the Issuing Lender under such Letter of Credit. In
consideration and in furtherance of the foregoing, each Lender with a Revolver
Commitment hereby absolutely and unconditionally agrees to pay to Agent, for the
account of the Issuing Lender, such Lender's Pro Rata Share of each L/C
Disbursement made by the Issuing Lender and not reimbursed by Borrowers on the
date due as provided in clause (a) of this Section, or of any reimbursement
payment required to be refunded to Borrowers for any reason. Each Lender with a
Revolver Commitment acknowledges and agrees that its obligation to deliver to
Agent, for the account of the Issuing Lender, an amount equal to its respective
Pro Rata Share of each L/C Disbursement made by the Issuing Lender pursuant to
this Section 2.12(c) shall be absolute and unconditional and such remittance
shall be made notwithstanding the occurrence or continuation of an Event of
Default or Default or the failure to satisfy any condition set forth in Section
3 hereof. If any such Lender fails to make available to Agent the amount of such
Lender's Pro Rata Share of any L/C Disbursement made by the Issuing Lender in
respect of such Letter of Credit as provided in this Section, such Lender shall
be deemed to be a Defaulting Lender. Agent (for the account of the Issuing
Lender) shall be entitled to recover such amount on demand from such Lender
together with interest thereon at the Defaulting Lender Rate until paid in full.
(d) Each Borrower hereby agrees to indemnify, save,
defend, and hold the Lender Group harmless from any loss, cost, expense, or
liability, and reasonable attorneys fees incurred by the Lender Group arising
out of or in connection with any Letter of Credit; provided, however, that no
Borrower shall be obligated hereunder to indemnify for any loss, cost, expense,
or liability that is caused by the gross negligence or willful misconduct of the
Issuing Lender or any other member of the Lender Group. Each Borrower agrees to
be bound by the Underlying Issuer's regulations and interpretations of any
Underlying Letter of Credit or by Issuing Lender's interpretations of any L/C
issued by Issuing Lender to or for such Borrower's account, even though this
interpretation may be different from such Borrower's own, and each Borrower
understands and agrees that the Lender Group shall not be liable for any error,
negligence, or mistake, whether of omission or commission, in following
Borrowers' instructions or those contained in the Letter of Credit or any
modifications, amendments, or supplements thereto. Each Borrower understands
that the L/C Undertakings may require Issuing Lender to indemnify
56
the Underlying Issuer for certain costs or liabilities arising out of claims by
Borrowers against such Underlying Issuer. Each Borrower hereby agrees to
indemnify, save, defend, and hold the Lender Group harmless with respect to any
loss, cost, expense (including reasonable attorneys fees), or liability incurred
by the Lender Group under any L/C Undertaking as a result of the Lender Group's
indemnification of any Underlying Issuer; provided, however, that no Borrower
shall be obligated hereunder to indemnify for any loss, cost, expense, or
liability that is caused by the gross negligence or willful misconduct of the
Issuing Lender or any other member of the Lender Group.
(e) Each Borrower hereby authorizes and directs any
Underlying Issuer to deliver to the Issuing Lender all instruments, documents,
and other writings and property received by such Underlying Issuer pursuant to
such Underlying Letter of Credit and to accept and rely upon the Issuing
Lender's instructions with respect to all matters arising in connection with
such Underlying Letter of Credit and the related application.
(f) Any and all charges, commissions, fees, and costs
incurred by the Issuing Lender relating to Underlying Letters of Credit shall be
Lender Group Expenses for purposes of this Agreement and immediately shall be
reimbursable by Borrowers to Agent for the account of the Issuing Lender; it
being acknowledged and agreed by each Borrower that, as of the Closing Date, the
usage charge imposed by the prospective Underlying Issuer is .825% per annum
times the face amount of each Underlying Letter of Credit, that such issuance
charge may be changed from time to time, and that the Underlying Issuer also
imposes a schedule of charges for amendments, extensions, drawings, and
renewals.
(g) If by reason of (i) any change after the Closing Date
in any Applicable Law, treaty, rule, or regulation or any change in the
interpretation or application thereof by any Governmental Authority, or (ii)
compliance by the Underlying Issuer or the Lender Group with any direction,
request, or requirement (irrespective of whether having the force of law) of any
Governmental Authority or monetary authority including, Regulation D of the
Federal Reserve Board as from time to time in effect (and any successor
thereto):
(i) any reserve, deposit, or similar requirement
is or shall be imposed or modified in respect of any Letter of
Credit issued hereunder, or
(ii) there shall be imposed on the Underlying
Issuer or the Lender Group any other condition regarding any
Underlying Letter of Credit or any Letter of Credit issued
pursuant hereto;
and the result of the foregoing is to increase, directly or indirectly, the cost
to the Lender Group of issuing, making, guaranteeing, or maintaining any Letter
of Credit or to reduce the amount receivable in respect thereof by the Lender
Group, then, and in any such case, Agent may (and at the direction of the
Required Lenders, Agent shall), at any time within a reasonable period after the
additional cost is incurred or the amount received is reduced, notify
Administrative Borrower, and Borrowers shall pay on demand such amounts as Agent
may specify to be necessary to compensate the Lender Group for such additional
cost or reduced receipt, together with interest on such amount from the date of
such demand until payment in full thereof at the rate then applicable to Base
Rate Loans hereunder. The determination by Agent of any amount
57
due pursuant to this Section, as set forth in a certificate setting forth the
calculation thereof in reasonable detail, shall, in the absence of manifest or
demonstrable error, be final and conclusive and binding on all of the parties
hereto.
2.13 LIBOR OPTION.
(a) INTEREST AND INTEREST PAYMENT DATES. In lieu of
having interest charged at the rate based upon the Base Rate, Borrowers shall
have the option (the "LIBOR Option") to have interest on all or a portion of the
Advances be charged at a rate of interest based upon the LIBOR Rate. The Term
Loan shall be a LIBOR Rate Loan at all times after the Closing Date until such
time as Agent may elect to convert the Term Loan to a Base Rate Loan upon the
occurrence and during the continuation of an Event of Default. Interest on LIBOR
Rate Loans shall be payable on the earliest of (i) the last day of the Interest
Period applicable thereto, unless the Interest Period is longer than 3 months,
in which case interest shall be payable on (A) each 3-month anniversary of the
commencement date of such Interest Period and (B) the last day of such Interest
Period, (ii) the occurrence of an Event of Default in consequence of which the
Required Lenders or Agent on behalf thereof elect to accelerate the maturity of
all or any portion of the Obligations, or (iii) termination of this Agreement
pursuant to the terms hereof. On the last day of each applicable Interest
Period, unless Administrative Borrower properly has exercised the LIBOR Option
with respect thereto, the interest rate applicable to such LIBOR Rate Loan
automatically shall convert to the rate of interest then applicable to Base Rate
Loans of the same type hereunder. At any time that an Event of Default has
occurred and is continuing, Borrowers no longer shall have the option to request
that Advances or the Term Loan bear interest at the LIBOR Rate and Agent shall
have the right to convert the interest rate on all outstanding LIBOR Rate Loans
to the rate then applicable to Base Rate Loans hereunder.
(b) LIBOR ELECTION.
(i) Administrative Borrower may, at any time and
from time to time, so long as no Event of Default has occurred
and is continuing, elect to exercise the LIBOR Option by
notifying Agent prior to 11:00 a.m. (California time) at least
3 Business Days prior to the commencement of the proposed
Interest Period (the "LIBOR Deadline"). Notice of
Administrative Borrower's election of the LIBOR Option for a
permitted portion of the Advances (or, with respect to the
selection of a new Interest Period, the Term Loan) and an
Interest Period pursuant to this Section shall be made by
delivery to Agent of a LIBOR Notice received by Agent before
the LIBOR Deadline, or by telephonic notice received by Agent
before the LIBOR Deadline (to be confirmed by delivery to
Agent of a LIBOR Notice received by Agent prior to 5:00 p.m.
(California time) on the same day). Promptly upon its receipt
of each such LIBOR Notice, Agent shall provide a copy thereof
to each of the Lenders having a Revolver Commitment.
(ii) Each LIBOR Notice shall be irrevocable and
binding on Borrowers. In connection with each LIBOR Rate Loan,
each Borrower shall indemnify, defend, and hold Agent and the
Lenders harmless against any loss, cost, or expense incurred
by Agent or any Lender as a result of (a) the payment of any
principal of any LIBOR Rate Loan other than on the last day of
an Interest
58
Period applicable thereto (including as a result of an Event
of Default), (b) the conversion of any LIBOR Rate Loan other
than on the last day of the Interest Period applicable
thereto, or (c) the failure to borrow, convert, continue or
prepay any LIBOR Rate Loan on the date specified in any LIBOR
Notice delivered pursuant hereto (such losses, costs, and
expenses, collectively, "Funding Losses"). Funding Losses
shall, with respect to Agent or any Lender, be deemed to equal
the amount determined by Agent or such Lender to be the
excess, if any, of (i) the amount of interest that would have
accrued on the principal amount of such LIBOR Rate Loan had
such event not occurred, at the LIBOR Rate that would have
been applicable thereto, for the period from the date of such
event to the last day of the then current Interest Period
therefor (or, in the case of a failure to borrow, convert or
continue, for the period that would have been the Interest
Period therefor), minus (ii) the amount of interest that would
accrue on such principal amount for such period at the
interest rate which Agent or such Lender would be offered were
it to be offered, at the commencement of such period, Dollar
deposits of a comparable amount and period in the London
interbank market. A certificate of Agent or a Lender delivered
to Administrative Borrower setting forth any amount or amounts
that Agent or such Lender is entitled to receive pursuant to
this Section shall be conclusive absent manifest error.
(iii) Borrowers shall have not more than 6 LIBOR
Rate Loans in effect at any given time. Borrowers only may
exercise the LIBOR Option for LIBOR Rate Loans of at least
$1,000,000 and integral multiples of $500,000 in excess
thereof.
(c) PREPAYMENTS. Borrowers may prepay LIBOR Rate Loans at
any time; provided, however, that in the event that LIBOR Rate Loans are prepaid
on any date that is not the last day of the Interest Period applicable thereto,
including as a result of any automatic prepayment through the required
application by Agent of proceeds of Collections in accordance with Section
2.4(b) or for any other reason, including early termination of the term of this
Agreement or acceleration of all or any portion of the Obligations pursuant to
the terms hereof, each Borrower shall indemnify, defend, and hold Agent and the
Lenders and their Participants harmless against any and all Funding Losses in
accordance with clause (b) above.
(d) SPECIAL PROVISIONS APPLICABLE TO LIBOR RATE.
(i) The LIBOR Rate may be adjusted by Agent with
respect to any Lender on a prospective basis to take into
account any additional or increased costs to such Lender of
maintaining or obtaining any eurodollar deposits or increased
costs due to changes in Applicable Laws occurring subsequent
to the commencement of the then applicable Interest Period,
including changes in tax laws (except changes of general
applicability in corporate income tax laws) and changes in the
reserve requirements imposed by the Board of Governors of the
Federal Reserve System (or any successor), excluding the
Reserve Percentage, which additional or increased costs would
increase the cost of funding loans bearing interest at the
LIBOR Rate. In any such event, the affected Lender shall give
Administrative Borrower and Agent notice of such a
determination and
59
adjustment and Agent promptly shall transmit the notice to
each other Lender and, upon its receipt of the notice from the
affected Lender, Administrative Borrower may, by notice to the
affected Lender (y) require such Lender to furnish to
Administrative Borrower a statement setting forth the basis
for adjusting such LIBOR Rate and the method for determining
the amount of such adjustment, or (z) repay the LIBOR Rate
Loans with respect to which such adjustment is made (together
with any amounts due under clause (b)(ii) above).
(ii) In the event that any change in market
conditions or any law, regulation, treaty, or directive, or
any change therein or in the interpretation of application
thereof, shall at any time after the date hereof, in the
reasonable opinion of any Lender, make it unlawful or
impractical for such Lender to fund or maintain LIBOR Advances
or to continue such funding or maintaining, or to determine or
charge interest rates at the LIBOR Rate, such Lender shall
give notice of such changed circumstances to Agent and
Administrative Borrower and Agent promptly shall transmit the
notice to each other Lender and (y) in the case of any LIBOR
Rate Loans of such Lender that are outstanding, the date
specified in such Lender's notice shall be deemed to be the
last day of the Interest Period of such LIBOR Rate Loans, and
interest upon the LIBOR Rate Loans of such Lender thereafter
shall accrue interest at the rate then applicable to Base Rate
Loans, and (z) Borrowers shall not be entitled to elect the
LIBOR Option until such Lender determines that it would no
longer be unlawful or impractical to do so.
(e) NO REQUIREMENT OF MATCHED FUNDING. Anything to the
contrary contained herein notwithstanding, neither Agent, nor any Lender, nor
any of their Participants, is required actually to acquire eurodollar deposits
to fund or otherwise match fund any Obligation as to which interest accrues at
the LIBOR Rate. The provisions of this Section shall apply as if each Lender or
its Participants had match-funded any Obligation as to which interest is
accruing at the LIBOR Rate by acquiring eurodollar deposits for each Interest
Period in the amount of the LIBOR Rate Loans.
2.14 CAPITAL REQUIREMENTS. If, after the date hereof, any Lender
determines that (i) the adoption of or change in any law, rule, regulation or
guideline regarding capital requirements for banks or bank holding companies, or
any change in the interpretation or application thereof by any Governmental
Authority charged with the administration thereof, or (ii) compliance by such
Lender or its parent bank holding company with any guideline, request or
directive of any such entity regarding capital adequacy (whether or not having
the force of law), will have the effect of reducing the return on such Lender's
or such holding company's capital as a consequence of such Lender's Commitments
hereunder to a level below that which such Lender or such holding company could
have achieved but for such adoption, change, or compliance (taking into
consideration such Lender's or such holding company's then existing policies
with respect to capital adequacy and assuming the full utilization of such
entity's capital) by any amount deemed by such Lender to be material, then such
Lender may notify Administrative Borrower and Agent thereof. Following receipt
of such notice, Borrowers agree to pay such Lender on demand the amount of such
reduction of return of capital as and when such reduction is determined, payable
within 90 days after presentation by such Lender of a statement in the amount
and setting forth in reasonable detail such Lender's calculation thereof and the
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assumptions upon which such calculation was based (which statement shall be
deemed true and correct absent manifest error). In determining such amount, such
Lender may use any reasonable averaging and attribution methods.
2.15 JOINT AND SEVERAL LIABILITY OF BORROWERS.
(a) Each Borrower is accepting joint and several
liability hereunder and under the other Loan Documents in consideration of the
financial accommodations to be provided by the Agent and the Lenders under this
Agreement, for the mutual benefit, directly and indirectly, of each Borrower and
in consideration of the undertakings of the other Borrowers to accept joint and
several liability for the Obligations.
(b) Each Borrower, jointly and severally, hereby
irrevocably and unconditionally accepts, not merely as a surety but also as a
co-debtor, joint and several liability with the other Borrowers, with respect to
the payment and performance of all of the Obligations (including, without
limitation, any Obligations arising under this Section 2.15), it being the
intention of the parties hereto that all the Obligations shall be the joint and
several obligations of each Borrower without preferences or distinction among
them.
(c) If and to the extent that any Borrower shall fail to
make any payment with respect to any of the Obligations as and when due or to
perform any of the Obligations in accordance with the terms thereof, then in
each such event the other Borrowers will make such payment with respect to, or
perform, such Obligation.
(d) The Obligations of each Borrower under the provisions
of this Section 2.15 constitute the absolute and unconditional, full recourse
Obligations of each Borrower enforceable against each such Borrower to the full
extent of its properties and assets, irrespective of the validity, regularity or
enforceability of this Agreement or any other circumstances whatsoever.
(e) Except as otherwise expressly provided in this
Agreement, each Borrower hereby waives notice of acceptance of its joint and
several liability, notice of any Advances or Letters of Credit issued under or
pursuant to this Agreement, notice of the occurrence of any Default, Event of
Default, or of any demand for any payment under this Agreement, notice of any
action at any time taken or omitted by Agent or Lenders under or in respect of
any of the Obligations, any requirement of diligence or to mitigate damages and,
generally, to the extent permitted by Applicable Laws, all demands, notices and
other formalities of every kind in connection with this Agreement (except as
otherwise provided in this Agreement). Each Borrower hereby assents to, and
waives notice of, any extension or postponement of the time for the payment of
any of the Obligations, the acceptance of any payment of any of the Obligations,
the acceptance of any partial payment thereon, any waiver, consent or other
action or acquiescence by Agent or Lenders at any time or times in respect of
any default by any Borrower in the performance or satisfaction of any term,
covenant, condition or provision of this Agreement, any and all other
indulgences whatsoever by Agent or Lenders in respect of any of the Obligations,
and the taking, addition, substitution or release, in whole or in part, at any
time or times, of any security for any of the Obligations or the addition,
substitution or release, in whole or in part, of any Borrower. Without limiting
the generality of the foregoing, each
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Borrower assents to any other action or delay in acting or failure to act on the
part of any Agent or Lender with respect to the failure by any Borrower to
comply with any of its respective Obligations, including, without limitation,
any failure strictly or diligently to assert any right or to pursue any remedy
or to comply fully with Applicable Laws or regulations thereunder, which might,
but for the provisions of this Section 2.15, afford grounds for terminating,
discharging or relieving any Borrower, in whole or in part, from any of its
Obligations under this Section 2.15, it being the intention of each Borrower
that, so long as any of the Obligations hereunder remain unsatisfied, the
Obligations of such Borrower under this Section 2.15 shall not be discharged
except by performance and then only to the extent of such performance. The
Obligations of each Borrower under this Section 2.15 shall not be diminished or
rendered unenforceable by any winding up, reorganization, arrangement,
liquidation, reconstruction or similar proceeding with respect to any Borrower
or any Agent or Lender. The joint and several liability of the Persons composing
Borrowers hereunder shall continue in full force and effect notwithstanding any
absorption, merger, amalgamation or any other change whatsoever in the name,
constitution or place of formation of any of the Persons composing Borrowers or
any Agent or Lender.
(f) Each Borrower represents and warrants to Agent and
Lenders that such Borrower is currently informed of the financial condition of
Borrowers and of all other circumstances which a diligent inquiry would reveal
and which bear upon the risk of nonpayment of the Obligations. Each Borrower
further represents and warrants to Agent and Lenders that such Borrower has read
and understands the terms and conditions of the Loan Documents. Each Borrower
hereby covenants that such Borrower will continue to keep informed of Borrowers'
financial condition, the financial condition of other guarantors, if any, and of
all other circumstances which bear upon the risk of nonpayment or nonperformance
of the Obligations.
(g) The provisions of this Section 2.15 are made for the
benefit of the Agent, the Lenders and their respective successors and assigns,
and may be enforced by it or them from time to time against any or all of
Borrowers as often as occasion therefor may arise and without requirement on the
part of any such Agent, Lender, successor or assign first to marshal any of its
or their claims or to exercise any of its or their rights against any of the
other Borrowers or to exhaust any remedies available to it or them against any
of the other Borrowers or to resort to any other source or means of obtaining
payment of any of the Obligations hereunder or to elect any other remedy. The
provisions of this Section 2.15 shall remain in effect until all of the
Obligations shall have been paid in full. If at any time, any payment, or any
part thereof, made in respect of any of the Obligations, is rescinded or must
otherwise be restored or returned by any Agent or Lender upon the insolvency,
bankruptcy or reorganization of any Borrower, or otherwise, the provisions of
this Section 2.15 will forthwith be reinstated in effect, as though such payment
had not been made.
(h) Each Borrower hereby agrees that it will not enforce
any of its rights of contribution or subrogation against the other Borrowers
with respect to any liability incurred by it hereunder or under any of the other
Loan Documents, any payments made by it to Agent or the Lenders with respect to
any of the Obligations or any collateral security therefor until such time as
all of the Obligations have been paid in full in cash. Any claim which any
Borrower may have against any other Borrower with respect to any payments to
Agent or Lender hereunder or under any other Loan Documents are hereby expressly
made subordinate and junior in right of
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payment, without limitation as to any increases in the Obligations arising
hereunder or thereunder, to the prior payment in full in cash of the Obligations
and, in the event of any insolvency, bankruptcy, receivership, liquidation,
reorganization or other similar proceeding under the laws of any jurisdiction
relating to any Borrower, its debts or its assets, whether voluntary or
involuntary, all such Obligations shall be paid in full in cash before any
payment or distribution of any character, whether in cash, securities or other
property, shall be made to any other Borrower therefor.
(i) Each Borrower hereby agrees that, after the
occurrence and during the continuance of any Default or Event of Default, the
payment of any amounts due with respect to the indebtedness owing by any
Borrower to any other Borrower is hereby subordinated to the prior payment in
full in cash of the Obligations. Each Borrower hereby agrees that after the
occurrence and during the continuance of any Default or Event of Default, such
Borrower will not demand, xxx for or otherwise attempt to collect any
indebtedness of any other Borrower owing to such Borrower until the Obligations
shall have been paid in full in cash. If, notwithstanding the foregoing
sentence, such Borrower shall collect, enforce or receive any amounts in respect
of such indebtedness, such amounts shall be collected, enforced and received by
such Borrower as trustee for the Agent, and the Agent shall deliver any such
amounts to Agent for application to the Obligations in accordance with Section
2.4(b).
2.16 REGISTERED NOTES. Agent agrees to record each Advance and each
Lender's Term Loan on the Register referenced in Section 14.1(h). Each Advance
and each Lender's Term Loan recorded on the Register (each a "Registered Loan")
may not be evidenced by promissory notes other than Registered Notes (as defined
below). Upon the registration of any Advance or any Lender's Term Loan,
Borrowers agree at the request of any Lender, to execute and deliver to such
Lender a promissory note, in conformity with the terms of this Agreement, in
registered form to evidence such Registered Loan, in form and substance
reasonably satisfactory to such Lender, and registered as provided in Section
14.1(h) (a "Registered Note"), payable to the order of such Lender and otherwise
duly completed, provided that any Registered Note issued to evidence Advances or
any Lender's Term Loan shall be issued in the principal amount of the applicable
Lender's Revolver Commitment or Term Loan Commitment. Once recorded on the
Register, each Advance and each Lender's Term Loan may not be removed from the
Register so long as it or they remain outstanding, and a Registered Note may not
be exchanged for a promissory note that it is not a Registered Note.
3. CONDITIONS; TERM OF AGREEMENT.
3.1 CONDITIONS PRECEDENT TO THE INITIAL EXTENSION OF CREDIT. The
obligation of the Lender Group (or any member thereof) to make the initial
Advance (or otherwise to extend any credit provided for hereunder), is subject
to the fulfillment, to the satisfaction of the Lender Group, of each of the
conditions precedent set forth below:
(a) the Closing Date shall occur on or before April 1,
2004;
(b) Agent shall have received one or more Uniform
Commercial Code filing authorization letters, duly executed by each Loan Party
or their representative, together with appropriate financing statements on Form
UCC-1 and PPSA financing statements duly filed in
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such office or offices as may be necessary or, in the opinion of Agent,
desirable to perfect Agent's Liens in and to the Collateral of such Loan Party,
and the Agent shall have received confirmation of the filing of all such
financing statements;
(c) Agent shall have received Uniform Commercial Code,
tax and judgment lien searches confirming the absence of, and mortgage releases,
termination statements and other release documents from JPMorgan and any other
Person necessary to release any Liens on the Collateral, other than the
Permitted Liens;
(d) Agent shall have received each of the following
documents, in form and substance reasonably satisfactory to Agent, duly
executed, and each such document shall be in full force and effect:
(i) the Agency Letter,
(ii) the Cash Management Agreements,
(iii) the Collateral Access Agreements with
respect to the locations set forth on Schedule 3.1(d),
(iv) the Consents,
(v) the Control Agreement for the Concentration
Account,
(vi) the Copyright Security Agreement,
(vii) the Disbursement Letter,
(viii) the Due Diligence Letter,
(ix) the Environmental Indemnity Agreements,
(x) the Fee Letter,
(xi) the Guarantor Security Agreement, which
shall, among other things, grant Agent a Lien on the
Reservation Management System,
(xii) the Guaranty,
(xiii) the Term Loan B Intercreditor Agreement,
(xiv) the Mortgages and related fixture filings,
(xv) the Officers' Certificate,
(xvi) the Patent and Trademark Security Agreement,
(xvii) the Quebec Security Documents,
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(xviii) the Release of Claims, and
(xix) the Stock Pledge Agreement, together with
all certificates representing the shares of Stock pledged
thereunder, as well as Stock powers with respect thereto
endorsed in blank.
(e) Agent shall have received a certificate from the
secretary of each Borrower attesting to the resolutions of such Borrower's Board
of Directors authorizing its execution, delivery, and performance of this
Agreement and the other Loan Documents to which such Borrower is a party and
authorizing specific officers of such Borrower to execute the same;
(f) Agent shall have received copies of each Borrower's
Governing Documents, as amended, modified, or supplemented to the Closing Date,
certified by the Secretary of such Borrower and by the appropriate officer of
the jurisdiction of organization of such Borrower;
(g) Agent shall have received a certificate of status
with respect to each Borrower, dated within 30 days of the Closing Date, such
certificate to be issued by the appropriate officer of the jurisdiction of
organization of such Borrower, which certificate shall indicate that such
Borrower is in good standing in such jurisdiction;
(h) Agent shall have received certificates of status with
respect to each Borrower, each dated within 30 days of the Closing Date, such
certificates to be issued by the appropriate officer of the jurisdictions (other
than the jurisdiction of organization of such Borrower) in which its failure to
be duly qualified or licensed would constitute a Material Adverse Change, which
certificates shall indicate that such Borrower is in good standing in such
jurisdictions;
(i) Agent shall have received a certificate from the
Secretary of each Guarantor attesting to the resolutions of such Guarantor's
Board of Directors authorizing its execution, delivery, and performance of the
Loan Documents to which such Guarantor is a party and authorizing specific
officers of such Guarantor to execute the same;
(j) Agent shall have received copies of each Guarantor's
Governing Documents, as amended, modified, or supplemented to the Closing Date,
certified by the Secretary of such Guarantor and by the appropriate officer of
the jurisdiction of organization of such Guarantor;
(k) Agent shall have received a certificate of status
with respect to each Guarantor, dated within 30 days of the Closing Date, such
certificate to be issued by the appropriate officer of the jurisdiction of
organization of such Guarantor, which certificate shall indicate that such
Guarantor is in good standing in such jurisdiction;
(l) Agent shall have received certificates of status with
respect to each Guarantor, each dated within 30 days of the Closing Date, such
certificates to be issued by the appropriate officer of the jurisdictions (other
than the jurisdiction of organization of such Guarantor) in which its failure to
be duly qualified or licensed would constitute a Material
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Adverse Change, which certificates shall indicate that such Guarantor is in good
standing in such jurisdictions;
(m) Agent shall have received a certificate of insurance,
together with the endorsements thereto, as are required by Section 6.8, the form
and substance of which shall be reasonably satisfactory to Agent and its
counsel;
(n) Agent shall have received opinions of Borrowers'
counsel (including any special counsel for real estate matters) in form and
substance reasonably satisfactory to the Lender Group, including without
limitation an opinion from Borrowers' counsel with respect to Vehicle perfection
matters and opinions from Agent's various local counsel as Agent may reasonably
request;
(o) Agent shall have received reasonably satisfactory
evidence (including a certificate of the chief financial officer or other senior
officer of Parent) that all tax returns required to be filed by Borrowers and
their Subsidiaries have been timely filed and all taxes upon Borrowers and their
Subsidiaries or their respective properties, assets, income, and franchises
(including Real Property taxes, sales taxes and payroll taxes) have been paid
not less than 30 days before the earlier of (a) delinquency or (b) the
imposition of any additional amounts, fines or penalties or before the
expiration of any extension period, except such taxes that are the subject of a
Permitted Protest or for which a Title Reserve has been established;
(p) Borrowers shall have the Required Availability after
giving effect to the initial extensions of credit hereunder;
(q) The Lender Group shall have completed its business,
legal, and collateral due diligence, including an investigation of the business,
assets, operations, properties (including compliance with FIRREA), condition
(financial or otherwise), contingent liabilities, prospects and Material
Contracts, and verification of Borrowers' representations and warranties to the
Lender Group, the results of which shall be reasonably satisfactory to the
Lender Group;
(r) Agent shall have received evidence that, upon the
making of the initial Advance and Term Loan hereunder, (i) Borrowers shall have
sufficient funds to pay (A) all outstanding Obligations (as defined therein)
under the DIP Loan Agreement, (B) all fees set forth in the Fee Letter and
hereunder, (C) all Lender Group Expenses incurred in connection with the
transactions evidenced by this Agreement and (D) all other obligations required
to be paid pursuant to the Reorganization Plan on the Effective Date, and (ii)
all such obligations set forth in clause (i) shall be paid in full with the
initial Advance and Term Loan;
(s) Agent shall have received mortgagee title insurance
policies (or marked commitments to issue the same) for the Real Property
Collateral issued by a title insurance company reasonably satisfactory to Agent
(each a "Mortgage Policy" and, collectively, the "Mortgage Policies") in amounts
reasonably satisfactory to Agent assuring Agent that the Mortgages on such Real
Property Collateral owned by a Loan Party are valid and enforceable first
priority mortgage Liens on such Real Property Collateral owned by a Loan Party
free and clear of all defects and encumbrances except Permitted Liens, and the
Mortgage Policies otherwise shall be in form and substance reasonably
satisfactory to Agent;
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(t) Agent shall have received executed copies of (i) each
Material Contract, (ii) each Affiliate Contract, and (iii) each contract between
any Loan Party, on the one hand, or any of SAC Holding, SSI, PMSR or PM
Preferred, on the other hand (which, as of the Closing Date, are all of the
contracts listed on Schedule 3.1(t)), and a complete list of each Borrower's
Subsidiaries, together with a certificate of the Secretary of Administrative
Borrower certifying each such document as being a true, correct, and complete
copy thereof;
(u) Borrowers shall have received all licenses, approvals
or evidence of other actions required by any Governmental Authority in
connection with the execution and delivery by Borrowers of this Agreement or any
other Loan Document or with the consummation of the transactions contemplated
hereby and thereby;
(v) Borrowers and Guarantors shall have (i) completed the
procedures set forth in Section 5.25 for the registration of all Certificates of
Title, naming Agent as the first priority lienholder, with the States of
Arizona, Alaska and Hawaii and the delivery of such original Certificates of
Title after registration thereof to Xxxxxxx Xxxxxx or Xxxx Xxxxxx at Parent's
location at 0000 Xxxxx Xxxxxxx, Xxxxxxx, Xxxxxxx 00000, (ii) delivered to Agent
evidence of approval from the State of Arizona for Borrowers to process and
register the Certificates of Title, in form and substance reasonably
satisfactory to Agent, and (iii) delivered to Agent a fidelity insurance policy
naming Agent as loss payee or bond endorsed to Agent, in each case in form and
substance reasonably satisfactory to Agent;
(w) Agent shall have received Schedule 3.1(w) from
Borrowers and Guarantors setting forth the book values of all box-trucks, cargo
vans and pickup trucks owned by the Loan Parties as of the Closing Date, subject
to Agent's first priority Liens, in form acceptable to Agent;
(x) Agent shall have received Borrowers' Closing Date
Business Plan;
(y) the Confirmation Order, in form and substance
reasonably satisfactory to Agent, approving the transactions contemplated hereby
shall have been entered by the Court and Agent shall have received a certified
copy of such Confirmation Order and such Confirmation Order shall not have been
reversed, stayed, amended or otherwise modified;
(z) all of the conditions set forth in the Confirmation
Order and the Reorganization Plan for the Effective Date shall have been
satisfied;
(aa) Agent shall have received copies of the New AMERCO
Note Documents and the Term Loan B Note Documents, each duly executed by the
parties thereto;
(bb) Agent shall have received evidence that Parent is in
good standing with, and duly listed on, Nasdaq and that the common stock of
Parent is traded on Nasdaq without restriction;
(cc) there shall not have been any changes in the senior
management of Parent after the Closing Date (as defined therein) of the DIP Loan
Agreement; and
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(dd) all other documents and legal matters in connection
with the transactions contemplated by this Agreement shall have been delivered,
executed, or recorded and shall be in form and substance reasonably satisfactory
to the Lender Group.
3.2 CONDITIONS SUBSEQUENT TO THE INITIAL EXTENSION OF CREDIT. The
obligation of the Lender Group (or any member thereof) to continue to make
Advances (or otherwise extend credit hereunder) is subject to the fulfillment,
on or before the date applicable thereto, of each of the conditions subsequent
set forth below (the failure by Borrowers to so perform or cause to be performed
constituting an Event of Default):
(a) within 30 days of the Closing Date, Borrowers shall
deliver to Agent certified copies of the policies of insurance, together with
the endorsements thereto, as are required by Section 6.8, the form and substance
of which shall be reasonably satisfactory to Agent and its counsel;
(b) within 90 days of the Closing Date or such longer
time period thereafter as may be acceptable to Agent, Borrowers shall deliver to
Agent all Cash Management Agreements, duly executed and in full force and
effect, requested by Agent in its Permitted Discretion;
(c) within 45 days of the Closing Date or such longer
time period thereafter as may be acceptable to Agent, Borrowers shall deliver to
Agent the Credit Card Agreements duly executed by the applicable credit card
processors and in full force and effect, the form and substance of which are
reasonably satisfactory to Agent;
(d) within 60 days of the Closing Date, Borrowers shall
have received and delivered to Agent zoning letters, in form and substance
acceptable to Agent, duly executed by the appropriate Governmental Authorities,
for the Real Property Collateral located at the locations on Schedule 3.2(d);
and
(e) within 60 days of the Closing Date, Agent shall have
received subordination, non-disturbance and attornment agreements duly executed
by the applicable Loan Party and tenant in favor of Agent with respect to the
properties set forth on Schedule 3.2(e), the form and substance of which are
reasonably satisfactory to Agent.
3.3 CONDITIONS PRECEDENT TO ALL EXTENSIONS OF CREDIT. The
obligation of the Lender Group (or any member thereof) to make all Advances (or
to extend any other credit hereunder, other than Advances that are deemed to be
made pursuant to Section 2.12(b) with respect to any unreimbursed L/C
Disbursement for a funded Letter of Credit) shall be subject to the following
conditions precedent:
(a) the representations and warranties contained in this
Agreement and the other Loan Documents shall be true and correct in all material
respects on and as of the date of such extension of credit, as though made on
and as of such date (except to the extent that such representations and
warranties relate solely to an earlier date);
(b) no Default or Event of Default shall have occurred
and be continuing on the date of such extension of credit, nor shall either
result from the making thereof;
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(c) no injunction, writ, restraining order, or other
order of any nature prohibiting, directly or indirectly, the extending of such
credit shall have been issued and remain in force by any Governmental Authority
against any Borrower, Agent, any Lender, or any of their Affiliates;
(d) except as otherwise set forth in Section 5.11(b), no
Material Adverse Change shall have occurred; and
(e) Agent shall have a first priority perfected Lien in
the Collateral except for Permitted Liens.
3.4 TERM. This Agreement shall become effective upon the execution
and delivery hereof by Borrowers, Agent and the Lenders and, subject to Section
3.5, shall continue in full force and effect for a term ending on the date (the
"Maturity Date") that is earliest of (a) February 27, 2009, or (b) the date of
termination of this Agreement by Agent or the Required Lenders upon the
occurrence and during the continuation of an Event of Default.
3.5 EFFECT OF TERMINATION. On the date of termination of this
Agreement, all Obligations (including contingent reimbursement obligations of
Borrowers with respect to any outstanding Letters of Credit but excluding all
Bank Product Obligations unless so requested by the Bank Product Provider) shall
immediately become due and payable without notice or demand (including (a)
either (i) providing cash collateral to be held by Agent for the benefit of
those Lenders with a Revolver Commitment in an amount equal to 105% of the then
extant Letter of Credit Usage, or (ii) causing the original Letters of Credit to
be returned to the Issuing Lender, and (b) if the Bank Product Provider so
requests, providing cash collateral (in an amount determined by the applicable
Bank Product Provider to satisfy the reasonably estimated credit exposure) to be
held by Agent for the benefit of the Bank Product Providers with respect to the
then extant Bank Product Obligations). No termination of this Agreement,
however, shall relieve or discharge Borrowers of their duties, Obligations, or
covenants hereunder and the Agent's Liens in the Collateral shall remain in
effect until all Obligations have been fully and finally discharged and the
Lender Group's obligations to provide additional credit hereunder have been
terminated. When this Agreement has been terminated and all of the Obligations
have been fully and finally discharged and the Lender Group's obligations to
provide additional credit under the Loan Documents have been terminated
irrevocably, Agent will, at Borrowers' sole expense, execute and deliver any
Uniform Commercial Code termination statements, lien releases, mortgage
releases, re-assignments of trademarks, Vehicle registration releases,
discharges of security interests, and other similar discharge or release
documents (and, if applicable, in recordable form) as are reasonably necessary
to release, as of record, the Agent's Liens and all notices of security
interests and liens previously filed by Agent with respect to the Obligations.
3.6 EARLY TERMINATION BY BORROWERS. Borrowers have the option, at
any time upon 30 days' prior written notice by Administrative Borrower to Agent,
to terminate this Agreement by paying to Agent, for the benefit of the Lender
Group and the Bank Product Providers, in cash on the applicable termination
date, the Obligations (including (a) either (i) providing cash collateral to be
held by Agent for the benefit of those Lenders with a Revolver Commitment in an
amount equal to 105% of the then extant Letter of Credit Usage, or (ii) causing
the original Letters of Credit to be returned to the Issuing Lender, and (b)
providing cash collateral (in an
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amount determined by the applicable Bank Product Provider as sufficient to
satisfy the reasonably estimated credit exposure) to be held by Agent for the
benefit of the Bank Product Providers with respect to the then extant Bank
Product Obligations), in full, together with the Applicable Prepayment Premium,
to be allocated among the Lenders in accordance with their Pro Rata Shares. If
Administrative Borrower has sent a notice of termination pursuant to the
provisions of this Section, then the Commitments shall terminate and Borrowers
shall be obligated to repay the Obligations (including (a) either (i) providing
cash collateral to be held by Agent for the benefit of those Lenders with a
Revolver Commitment in an amount equal to 105% of the then extant Letter of
Credit Usage, or (ii) causing the original Letters of Credit to be returned to
the Issuing Lender, and (b) providing cash collateral to be held by Agent for
the benefit of the Bank Product Providers with respect to the then extant Bank
Product Obligations), in full, together with the Applicable Prepayment Premium,
on the date set forth as the date of termination of this Agreement in such
notice. In the event of the termination of this Agreement and repayment of the
Obligations at any time prior to the Maturity Date, for any other reason,
including (1) termination upon the election of the Required Lenders to terminate
after the occurrence of an Event of Default, (2) foreclosure and sale of
Collateral, (3) sale of the Collateral in any Insolvency Proceeding, or (4)
restructure, reorganization or compromise of the Obligations by the confirmation
of a plan of reorganization, or any other plan of compromise, restructure, or
arrangement in any Insolvency Proceeding, then, in view of the impracticability
and extreme difficulty of ascertaining the actual amount of damages to the
Lender Group or profits lost by the Lender Group as a result of such early
termination, and by mutual agreement of the parties as to a reasonable
estimation and calculation of the lost profits or damages of the Lender Group,
Borrowers shall pay the Applicable Prepayment Premium to Agent to be allocated
among the Lenders in accordance with their Pro Rata Shares, measured as of the
date of such termination.
4. CREATION OF SECURITY INTEREST.
4.1 GRANT OF SECURITY INTEREST. Each Borrower hereby grants to
Agent, for the benefit of the Lender Group and the Bank Product Providers, a
continuing first priority perfected security interest in all of its right,
title, and interest in all currently existing and hereafter acquired or arising
Personal Property Collateral in order to secure prompt repayment of any and all
of the Obligations in accordance with the terms and conditions of the Loan
Documents and in order to secure prompt performance by Borrowers of each of
their covenants and duties under the Loan Documents. The Agent's Liens in and to
the Personal Property Collateral shall attach to all Personal Property
Collateral without further act on the part of Agent or Borrowers. Anything
contained in this Agreement or any other Loan Document to the contrary
notwithstanding, except for Permitted Dispositions, Borrowers have no authority,
express or implied, to dispose of any item or portion of the Collateral.
4.2 NEGOTIABLE COLLATERAL AND CHATTEL PAPER. Each Borrower
covenants and agrees with Agent that from and after the Closing Date and until
the date of termination of this Agreement in accordance with Section 3.5:
(a) In the event that any Collateral, including proceeds,
is evidenced by or consists of Negotiable Collateral of any Borrower, and if and
to the extent that perfection of priority of Agent's security interest with
respect to such Collateral is dependent on or enhanced
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by possession, the applicable Borrower, immediately upon the request of Agent,
shall endorse and deliver physical possession of such Negotiable Collateral to
Agent;
(b) Upon request by Agent, each Borrower shall take all
steps reasonably necessary to grant Agent control of all electronic Chattel
Paper of such Borrower in accordance with the Code and all "transferable
records" as defined in each of the Uniform Electronic Transactions Act and the
Electronic Signatures in Global and National Commerce Act; and
(c) In the event any Borrower, with Agent's consent,
retains possession of any Chattel Paper or instruments otherwise required to be
endorsed and delivered to Agent pursuant to Section 4.2(a), all of such Chattel
Paper and instruments shall be marked with the following legend: "This writing
and the obligations evidenced or secured thereby are subject to the security
interest of Xxxxx Fargo Foothill, Inc., as Agent."
4.3 COLLECTION OF ACCOUNTS, GENERAL INTANGIBLES, AND NEGOTIABLE
COLLATERAL. At any time after the occurrence and during the continuation of an
Event of Default, Agent or Agent's designee may (a) notify Account Debtors of
Borrowers that Borrowers' Accounts, Chattel Paper, or General Intangibles (other
than the Excluded Assets) have been assigned to Agent or that Agent has a
security interest therein, or (b) collect Borrowers' Accounts, Chattel Paper, or
General Intangibles (other than the Excluded Assets) directly and charge the
collection costs and expenses to the Loan Account. Each Borrower agrees that it
will hold in trust for the Lender Group, as the Lender Group's trustee, any
Collections that it receives and immediately will deliver said Collections to
Agent or a Cash Management Bank in their original form as received by the
applicable Borrower.
4.4 DELIVERY OF ADDITIONAL DOCUMENTATION REQUIRED. Each Borrower
hereby authorizes Lender to file, transmit, or communicate, as applicable,
Uniform Commercial Code financing statements and amendments describing the
Collateral as "all personal property of debtor" or "all assets of debtor" or
words of similar effect in order to perfect Agent's Liens on the Collateral
without any Borrower's signature, to the extent permitted by Applicable Laws;
provided, however, Agent shall clearly identify Excluded Assets as excepted
items. Notwithstanding the foregoing, at any time upon the request of Agent,
Borrowers shall execute and deliver to Agent any and all financing statements,
original financing statements in lieu of continuation statements, fixture
filings, security agreements, pledges, assignments, endorsements of certificates
of title, supplements, and all other documents (the "Additional Documents") upon
which a Borrower's signature may be required that Agent may request in its
Permitted Discretion, in form and substance reasonably satisfactory to Agent, to
perfect and continue perfection of or better perfect the Agent's Liens in the
Collateral (whether now owned or hereafter arising or acquired), to create and
perfect Liens in favor of Agent in any Real Property acquired after the Closing
Date, and in order to fully consummate all of the transactions contemplated
hereby and under the other Loan Documents. To the maximum extent permitted by
Applicable Laws, each Borrower authorizes Agent to execute any such Additional
Documents in the applicable Borrower's name and authorize Agent to file such
executed Additional Documents in any appropriate filing office, and Agent shall
provide Administrative Borrower with copies of any such filings; provided,
however, that the failure by Agent to so provide such filings shall not affect
the authorizations herein. Each Borrower also hereby ratifies its authorization
for Agent to have filed in any jurisdiction any Uniform Commercial Code
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financing statements or amendments thereto if filed prior to the Closing Date.
No Borrower shall terminate, amend or file a correction statement with respect
to any Uniform Commercial Code financing statement filed pursuant to this
Section 4.4 without Agent's prior written consent. In addition, on a quarterly
basis as Agent shall require, Borrowers shall (a) cause all patents, copyrights,
and trademarks acquired or generated by Borrowers that are not already the
subject of a registration with the appropriate filing office (or an application
therefor diligently prosecuted) to be registered with such appropriate filing
office in a manner sufficient to impart constructive notice of Borrowers'
ownership thereof, and (b) cause to be prepared, executed, and delivered to
Agent supplemental schedules to the applicable Loan Documents to identify such
patents, copyrights, and trademarks as being subject to the security interests
created thereunder. Administrative Borrower shall provide Agent with notice that
any Borrower or any Guarantor has made a Permitted Investment of the type
described in clause (e), (g) or (l) of the definition of "Permitted Investment"
promptly, but in any event within 5 Business Days, following the consummation
thereof and, upon the request of Agent, the relevant Loan Party shall execute
and deliver (or cause to be executed and delivered to Agent) any and all
Additional Documents requested by Agent to perfect the Agent's Liens in such
Permitted Investment.
4.5 POWER OF ATTORNEY. Each Borrower hereby irrevocably makes,
constitutes, and appoints Agent (and any of Agent's officers, employees, or
agents designated by Agent) as such Borrower's true and lawful attorney, with
power to (a) if such Borrower refuses to execute and deliver, or fails timely to
execute and deliver any of the documents described in Section 4.4, sign the name
of such Borrower on any of the documents described in Section 4.4, (b) at any
time that an Event of Default has occurred and is continuing, sign such
Borrower's name on any invoice or xxxx of lading relating to the Collateral,
drafts against Account Debtors of such Borrower, or notices to such Account
Debtors, (c) send requests for verification of such Borrower's Accounts, (d)
endorse such Borrower's name on any Collection item that may come into the
Lender Group's possession, (e) at any time that an Event of Default has occurred
and is continuing, make, settle, and adjust all claims under such Borrower's
policies of insurance and make all determinations and decisions with respect to
such policies of insurance, and (f) at any time that an Event of Default has
occurred and is continuing, settle and adjust disputes and claims respecting
such Borrower's Accounts, Chattel Paper, or General Intangibles other than the
Excluded Assets directly with Account Debtors of such Borrower, for amounts and
upon terms that Agent determines to be reasonable, and Agent may cause to be
executed and delivered any documents and releases that Agent determines to be
necessary. The appointment of Agent as each Borrower's attorney, and each and
every one of its rights and powers, being coupled with an interest, is
irrevocable until all of the Obligations have been fully and finally repaid and
performed and the Lender Group's obligations to extend credit hereunder are
terminated.
4.6 RIGHT TO INSPECT.
(a) Agent (through its officers, employees, or agents) shall have the right to,
and at the request of the Required Lenders shall, from time to time hereafter,
inspect Borrowers' Books and records and to check, test, and appraise the
Collateral in order to verify Borrowers' financial condition or the amount,
quality, value, condition of, or any other matter relating to, the Collateral;
provided, however, that so long as an Event of Default does not exist, any such
inspection shall occur only during normal business hours. Absent the occurrence
and continuance of an Event of Default during such calendar year, Agent may, and
at the request of
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the Required Lenders shall, require appraisals in each calendar year of only
those parcels of Real Property constituting the lesser of (i) up to 20% of the
Fair Market Valuation of Real Property Collateral (as determined by Agent in its
Permitted Discretion) or (ii) up to 100 parcels of Real Property Collateral per
calendar year; provided, however, that if Agent determines, in its Permitted
Discretion, that there has been a significant decrease in the Fair Market
Valuation of Real Property Collateral, Agent may, and at the request of the
Required Lenders shall, require appraisals of all parcels of Real Property
Collateral or such lesser amount as may be determined by Agent in its Permitted
Discretion per calendar year.
(b) Borrowers acknowledge and agree that, at the expense of
Borrowers, Agent shall have the right to conduct, on a quarterly basis or more
frequently if an Event of Default exists, an independent inspection of 5% of the
Certificates of Title then on hand with any appropriate Governmental Authority
in order to verify the accuracy and completeness of any information contained on
such Certificates of Title and compliance with this Agreement; provided,
however, that if Agent determines, in its Permitted Discretion, that there are
significant errors or discrepancies in the Certificates of Title or
non-compliance with this Agreement, Agent and the Lenders shall, at the expense
of Borrowers, have the right to conduct an independent inspection of all of
Certificates of Title or such lesser amount as may be determined by Agent in its
Permitted Discretion. Borrowers shall, or shall cause Guarantors to, deliver to
Agent (or its designees) any power of attorney or other document that may be
requested by Agent or required by such Governmental Authority in connection
therewith. Borrowers acknowledge that such inspection may be conducted by
employees of Agent or any third party retained by Agent for such purposes.
4.7 CONTROL AGREEMENTS. Each Borrower agrees that it will not
transfer assets out of any Securities Accounts other than as permitted under
Section 7.19 and, if to another securities intermediary, unless each of the
applicable Borrower, Agent, and the substitute securities intermediary have
entered into a Control Agreement. No arrangement contemplated hereby or by any
Control Agreement in respect of any Securities Accounts or other Investment
Property of Borrowers shall be modified by Borrowers without the prior written
consent of Agent. Upon the occurrence and during the continuance of a Default or
Event of Default, Agent may notify any securities intermediary to liquidate the
applicable Securities Account or any related Investment Property maintained or
held thereby and remit the proceeds thereof to the Agent's Account.
4.8 COMMERCIAL TORT CLAIMS. Borrowers shall promptly notify Agent
in writing in the event any Borrower shall incur or otherwise obtain a
Commercial Tort Claim in excess of $100,000 after the Closing Date against any
third party and, upon the request of Agent, shall promptly amend Schedule C-1,
authorize the filing of additional Uniform Commercial Code financing statements
or amendments to existing Uniform Commercial Code financing statements, and do
such other acts or things deemed necessary or desirable by Agent to grant Agent
a first priority, perfected security interest in any such Commercial Tort Claim,
including, without limitation executing an assignment of such Commercial Tort
Claim.
4.9 GRANTS, RIGHTS AND REMEDIES. The Liens and security interests
granted by each Borrower to Agent (for the benefit of Lender Group) by and
pursuant to Section 4.1 hereof may be independently granted by the Loan
Documents hereafter entered into. This Agreement and
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such other Loan Documents supplement each other, and the grants, priorities,
rights and remedies of Agent hereunder and thereunder are cumulative.
4.10 SURVIVAL. The Liens and security interests granted to Agent
(for the benefit of Lender Group), the priority of such Liens and security
interests, and the administrative priorities and other rights and remedies
granted to Lender Group pursuant to this Agreement and the other Loan Documents
(specifically including but not limited to the existence, perfection and
priority of the Liens and security interest provided herein and therein) shall
not be modified, altered or impaired in any manner by any other financing or
extension of credit or incurrence of debt by any Borrower or by any other act or
omission whatsoever.
5. REPRESENTATIONS AND WARRANTIES.
In order to induce the Lender Group to enter into this
Agreement, each Borrower makes the following representations and warranties to
the Lender Group, which representations and warranties shall be true, correct,
and complete, in all material respects, as of the date hereof, and shall be
true, correct, and complete, in all material respects, as of the Closing Date,
and at and as of the date of the making of each Advance (or other extension of
credit) made thereafter, as though made on and as of the date of such Advance
(or other extension of credit) (except to the extent that such representations
and warranties relate solely to an earlier date) and such representations and
warranties shall survive the execution and delivery of this Agreement:
5.1 NO ENCUMBRANCES. Each Borrower and each Guarantor has good and
indefeasible title to its assets, free and clear of Liens except for Permitted
Liens. Each Borrower and each Guarantor is the vested fee owner of each parcel
of Real Property Collateral set forth next to its name on Schedule R-1 hereto,
and such ownership is free and clear of all title defects and Liens, except
Permitted Liens of the type described in clauses (b), (f), (j), (k), (l) and (n)
of the definition thereof.
5.2 OWNERSHIP OF CERTAIN ASSETS. Borrowers and U-Haul (Canada) are
the only Loan Parties that own any parcel of Real Property Collateral or any
Vehicle included in the Collateral.
5.3 [INTENTIONALLY OMITTED.]
5.4 EQUIPMENT. All of the Equipment is used or held for use in
Borrowers' or Guarantors' businesses and is fit for such purposes.
5.5 LOCATION OF EQUIPMENT. The Equipment of Borrowers and
Guarantors is stored only at the locations permitted by Section 6.9 hereof.
5.6 EQUIPMENT RECORDS. Each Borrower and each Guarantor keeps
correct and accurate records itemizing and describing the type, quality, and
quantity of its Equipment and the book value thereof.
5.7 LOCATION OF CHIEF EXECUTIVE OFFICE; FEIN; ORGANIZATIONAL ID
NUMBER. The chief executive office of each Borrower and each Guarantor is
located at the address indicated in Schedule 5.7 and each Borrower's and each
Guarantor's FEIN and Organizational ID Number
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or, in the case of the Canadian Subsidiaries, the numbers assigned by Canada
Customs and Revenue Agency (Canada) are identified in Schedule 5.7. As of the
Closing Date, each Borrower's and each Guarantor's exact legal name is as set
forth on the signature pages to the Agreement, and in the 5 years prior to the
Closing Date no Borrower and no Guarantor has been known by any other name, or
had a business at any address other than those specified on Schedule 5.7.
5.8 DUE ORGANIZATION AND QUALIFICATION; SUBSIDIARIES; AFFILIATES.
(a) Each Borrower and each Guarantor is duly organized
and existing and in good standing under the laws of the jurisdiction of its
organization and qualified to do business in any state, province or territory
where the failure to be so qualified reasonably could be expected to have a
Material Adverse Change.
(b) Set forth on Schedule 5.8(b), is a complete and
accurate description of the authorized capital Stock of each Borrower and each
Guarantor, by class, and, as of the Closing Date, a description of the number of
shares of each such class that are issued and outstanding. Other than as
described on Schedule 5.8(b), there are no subscriptions, options, warrants, or
calls relating to any shares of each Borrower's and each Guarantor's capital
Stock, including any right of conversion or exchange under any outstanding
security or other instrument. Neither any Borrower nor any Guarantor is subject
to any obligation (contingent or otherwise) to repurchase or otherwise acquire
or retire any shares of its capital Stock or any security convertible into or
exchangeable for any of its capital Stock.
(c) Set forth on Schedule 5.8(c), is a complete and
accurate list of each Borrower's and each Guarantor's direct and indirect
Subsidiaries, showing: (i) the jurisdiction of their organization; (ii) the
number of shares of each class of common and preferred Stock authorized for each
of such Subsidiaries; and (iii) the number and the percentage of the outstanding
shares of each such class owned directly or indirectly by the applicable
Borrower or Guarantor. All of the outstanding capital Stock of each such
Subsidiary has been validly issued and is fully paid and non-assessable.
(d) Except as set forth on Schedule 5.8(d), there are no
subscriptions, options, warrants, or calls relating to any shares of any
Borrower's, any Guarantor's, or any of their respective Subsidiaries' capital
Stock, including any right of conversion or exchange under any outstanding
security or other instrument. No Borrower, Guarantor or any of their respective
Subsidiaries is subject to any obligation (contingent or otherwise) to
repurchase or otherwise acquire or retire any shares of any Borrower's or any
Guarantor's Subsidiaries' capital Stock or any security convertible into or
exchangeable for any such capital Stock.
(e) Set forth on Schedule 5.8(e) is a complete and
accurate list of each Borrower's and each Guarantor's Affiliates showing the
relation (whether through direct ownership, common ownership or otherwise)
between such Borrower and such Affiliates.
(f) The Dormant Subsidiaries (i) are inactive and do not
engage in any business activities, (ii) do not have assets with an aggregate
fair market value in excess of $100,000, and (iii) do not have any annual
operating expenditures or other liabilities.
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(g) INW is the subject of an Insolvency Proceeding as of
the Closing Date.
5.9 DUE AUTHORIZATION; NO CONFLICT.
(a) As to each Borrower, the execution, delivery, and
performance by such Borrower of this Agreement and the Loan Documents to which
it is a party have been duly authorized by all necessary action on the part of
such Borrower.
(b) As to each Borrower, the execution, delivery, and
performance by such Borrower of this Agreement and the Loan Documents to which
it is a party do not and will not (i) violate any provision of federal, state,
provincial or local law or regulation applicable to any Borrower, the Governing
Documents of any Borrower, or any order, judgment, or decree of any court or
other Governmental Authority binding on any Borrower, (ii) conflict with, result
in a material breach of, or constitute (with due notice or lapse of time or
both) a default under any material contractual obligation of any Borrower,
including without limitation the Material Contracts, (iii) result in or require
the creation or imposition of any Lien of any nature whatsoever upon any
properties or assets of any Borrower, other than Permitted Liens, or (iv)
require any approval of any Borrower's interest holders or any approval or
consent of any Person under any material contractual obligation of any Borrower,
including without limitation the Material Contracts, except for any such
approvals that have been obtained or are expressly not required in accordance
with the terms of the Reorganization Plan.
(c) Other than the filing of the Uniform Commercial Code
financing statements, fixture filings and Mortgages and the entry of the
Confirmation Order, the execution, delivery, and performance by each Borrower of
this Agreement and the Loan Documents to which such Borrower is a party do not
and will not require any registration with, consent, or approval of, or notice
to, or other action with or by, any Governmental Authority or other Person.
(d) As to each Borrower, this Agreement and the other
Loan Documents to which such Borrower is a party, and all other documents
contemplated hereby and thereby, when executed and delivered by such Borrower
will be the legally valid and binding obligations of such Borrower, enforceable
against such Borrower in accordance with their respective terms, except as
enforcement may be limited by equitable principles or by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or limiting creditors'
rights generally.
(e) The Agent's Liens are validly created, perfected, and
first priority Liens, subject only to Permitted Liens.
(f) The execution, delivery, and performance by each
Guarantor of the Loan Documents to which it is a party have been duly authorized
by all necessary action on the part of such Guarantor.
(g) The execution, delivery, and performance by each
Guarantor of the Loan Documents to which it is a party do not and will not (i)
violate any provision of federal, state, or local law or regulation applicable
to such Guarantor, the Governing Documents of such Guarantor, or any order,
judgment, or decree of any court or other Governmental Authority binding on such
Guarantor, (ii) conflict with, result in a material breach of, or constitute
(with due notice or lapse of time or both) a default under any material
contractual obligation of such
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Guarantor, (iii) result in or require the creation or imposition of any Lien of
any nature whatsoever upon any properties or assets of such Guarantor, other
than Permitted Liens, or (iv) require any approval of such Guarantor's interest
holders or any approval or consent of any Person under any material contractual
obligation of such Guarantor, including without limitation the Material
Contracts, except for approvals that have been obtained.
(h) Other than the filing of Uniform Commercial Code
financing statements, fixture filings and Mortgages, the execution, delivery,
and performance by each Guarantor of the Loan Documents to which such Guarantor
is a party do not and will not require any registration with, consent, or
approval of, or notice to, or other action with or by, any Governmental
Authority or other Person.
(i) The Loan Documents to which any Guarantor is a party,
and all other documents contemplated hereby and thereby, when executed and
delivered by such Guarantor will be legally valid and binding obligations of
such Guarantor, enforceable against Guarantor in accordance with their
respective terms, except as enforcement may be limited by equitable principles
or by bankruptcy, insolvency, reorganization, moratorium, or similar laws
relating to or limiting creditors' rights generally.
5.10 LITIGATION. Other than those matters disclosed on Schedule
5.10, there are no actions, suits, arbitrations, administrative hearings or
other proceedings pending or, to the knowledge of Borrowers, threatened against
Borrowers, Guarantors or any of their Subsidiaries (excluding the Insurance
Subsidiaries), as applicable, except for (a) matters that are fully covered by
insurance (subject to customary deductibles), (b) routine litigation arising in
the ordinary course of business that is not material and (c) matters arising
after the Closing Date that, if decided adversely to Borrowers, Guarantors, or
any of their Subsidiaries, as applicable, reasonably could not be expected to
result in a Material Adverse Change.
5.11 FINANCIAL STATEMENTS; NO MATERIAL ADVERSE CHANGE. (a) All
financial statements relating to Borrowers or Guarantors that have been
delivered by Borrowers or Guarantors to the Lender Group (i) have been prepared
in accordance with GAAP (except, in the case of unaudited financial statements,
for the lack of footnotes and being subject to year-end audit adjustments), (ii)
are true and correct in all material respects, and accurately present Borrowers'
(or Guarantors', as applicable) financial condition as of the date thereof,
(iii) do not and will not contain any untrue statement of material fact or omit
to state any material fact necessary in order to make such statements contained
therein not misleading in light of the circumstances under which such statements
were made. All Projections, if any, that have been made or will be prepared by
or on behalf of Borrowers or any of their respective representatives and made
available to Agent, and the Lenders have been or will be prepared in good faith
based upon assumptions that are reasonable at the time made and at the time the
related Projections are made available to Agent and the Lenders.
(b) Other than (i) the filing of the Chapter 11 Case,
(ii) the withdrawal by PriceWaterhouseCoopers of its audit letter with respect
to Borrowers' financial statements for the fiscal year ended as of March 31,
2002 and (iii) such other matters as have been set forth in writing by Borrowers
to Agent on or before October 1, 2003, there has not been a Material Adverse
Change with respect to Borrowers (or Guarantors, as applicable) since March 31,
2003.
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5.12 FRAUDULENT TRANSFER.
(a) Each Borrower and each Guarantor is Solvent.
(b) No transfer of property is being made by any Borrower
or any Guarantor and no obligation is being incurred by any Borrower or any
Guarantor in connection with the transactions contemplated by this Agreement or
the other Loan Documents with the intent to hinder, delay, or defraud either
present or future creditors of Borrowers or Guarantors.
5.13 EMPLOYEE BENEFITS. No Borrower, Guarantor, Subsidiary of a
Borrower or a Guarantor, or ERISA Affiliate of a Borrower or a Guarantor
maintains or contributes to any Benefit Plan, other than those listed on
Schedule 5.13. Each Borrower, Guarantor, Subsidiary of a Borrower or a Guarantor
and ERISA Affiliate of a Borrower or a Guarantor has satisfied the minimum
funding standards of ERISA and the IRC with respect to each Benefit Plan to
which it is obligated to contribute. No ERISA Event has occurred nor has any
other event occurred that may result in an ERISA Event that reasonably could be
expected to result in a Material Adverse Change. No Borrower, Guarantor,
Subsidiary of a Borrower or a Guarantor, ERISA Affiliate of a Borrower or
Guarantor, or, to Borrowers' knowledge, fiduciary of any Benefit Plan is subject
to any direct or indirect liability with respect to any Benefit Plan under any
Applicable Law, treaty, rule, regulation, or agreement (other than liability for
the minimum required funding of such Benefit Plan in accordance with Sections
302 of ERISA and 412 of the IRC; under circumstances that do not involve any
current or past "accumulated funding deficiency" as defined in Sections 302 of
ERISA and 412 of the IRC). No Borrower, Guarantor, Subsidiary of a Borrower or a
Guarantor, or ERISA Affiliate of a Borrower or a Guarantor is required to
provide security to any Benefit Plan under Section 401(a)(29) of the IRC.
5.14 ENVIRONMENTAL CONDITION. Except as set forth on Schedule 5.14,
(a) to Borrowers' knowledge, no properties or assets of Borrowers or Guarantors
have ever been used by Borrowers, Guarantors, or by previous owners or operators
in the disposal of, or to produce, store, handle, treat, release, or transport,
any Hazardous Materials, where such production, storage, handling, treatment,
release or transport was in violation, in any material respect, of applicable
Environmental Law, (b) to Borrowers' knowledge, no properties or assets of
Borrowers or Guarantors have ever been designated or identified in any manner
pursuant to any environmental protection statute as a Hazardous Materials
disposal site, (c) no Borrower or Guarantor has received notice that a Lien
arising under any Environmental Law has attached to any revenues or to any Real
Property owned or operated by Borrowers, and (d) no Borrower or Guarantor has
received a summons, citation, notice, or directive from the Environmental
Protection Agency or any other federal or state governmental agency concerning
any action or omission by any Borrower or any Guarantor resulting in the
releasing or disposing of Hazardous Materials into the environment.
5.15 BROKERAGE FEES. Borrowers and Guarantors have not utilized the
services of any broker or finder in connection with Borrowers' obtaining
financing from the Lender Group under this Agreement and no brokerage commission
or finders fee is payable by Borrowers or Guarantors in connection herewith.
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5.16 INTELLECTUAL PROPERTY. Each Borrower or each Guarantor owns,
or holds licenses in, all trademarks, trade names, copyrights, patents, patent
rights, and licenses that are necessary to the conduct of its business as
currently conducted. Attached hereto as Schedule 5.16 is a true, correct, and
complete listing of all material patents, patent applications, trademarks,
trademark applications, copyrights, and copyright registrations as to which each
Borrower or each Guarantor is the owner or is an exclusive licensee.
5.17 LEASES. Borrowers and Guarantors enjoy peaceful and
undisturbed possession under all leases material to the business of Borrowers
and Guarantors and to which Borrowers or Guarantors are a party or under which
Borrowers or Guarantors are operating. All of such leases are valid and
subsisting and no material default by Borrowers or Guarantors exists under any
of them.
5.18 DDAS. Set forth on Schedule 5.18 are all Borrowers' and
Guarantors' DDAs, including, with respect to each depository (i) the name and
address of such depository, and (ii) the account numbers of the accounts
maintained with such depository.
5.19 COMPLETE DISCLOSURE. All factual information (taken as a
whole) furnished by or on behalf of Borrowers or Guarantors in writing to Agent
or any Lender (including all information contained in the Schedules hereto or in
the other Loan Documents) for purposes of or in connection with this Agreement,
the other Loan Documents, or any transaction contemplated herein or therein is,
and all other such factual information (taken as a whole) hereafter furnished by
or on behalf of Borrowers or Guarantors in writing to the Agent or any Lender
will be, true and accurate, in all material respects, on the date as of which
such information is dated or certified and not incomplete by omitting to state
any fact necessary to make such information (taken as a whole) not misleading in
any material respect at such time in light of the circumstances under which such
information was provided. On the Closing Date, the Projections represent, and as
of the date on which any other Projections are delivered to Agent, such
additional Projections represent Borrowers' good faith best estimate of its
future performance for the periods covered thereby.
5.20 INDEBTEDNESS, ETC.
(a) Set forth on Schedule 5.20(a) is a true and complete
list of all Indebtedness of each Borrower or Guarantors outstanding immediately
prior to the Closing Date that is to remain outstanding after the Closing Date
and such Schedule accurately reflects the aggregate principal amount of such
Indebtedness.
(b) Set forth on Schedule 5.20(b) is a true and complete
summary of all TRAC Lease Transactions in existence as of the Closing Date that
are to remain outstanding after the Closing Date.
(c) No Loan Party is a party to or subject to any
agreement that prohibits or restricts the ability of any Loan Party to
refinance, amend, modify or prepay the Obligations or this Agreement, except for
(i) restrictions set forth in the Intercreditor Agreement and (ii) restrictions
in the Synthetic Leases as of the Closing Date and fully disclosed on Schedule
5.20(c) hereto.
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5.21 CONFIRMATION ORDER. The Confirmation Order has been validly
entered by the Court and has not been stayed, reversed, vacated or otherwise
modified except with the consent of Agent and the Required Lenders.
5.22 RESERVATION MANAGEMENT SYSTEM. The Reservation Management
System is owned by A&M Associates, Inc., a Nevada corporation, free and clear of
claims and encumbrances.
5.23 TAXES AND REMITTANCES. Parent and its Subsidiaries have filed
all federal (including the federal government of Canada) and other tax returns
and reports required to be filed, and have paid all federal (including the
federal government of Canada) and other taxes, assessments, fees and other
governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except to the extent (i) the payment of any of
the foregoing is subject to a long-term payment schedule under the
Reorganization Plan or (ii) is the subject of a Permitted Protest. Parent and
its Subsidiaries have remitted all contributions required pursuant to the Canada
Pension Plan Act (Canada), provincial pension plan contributions, workers
compensation assessments, and employment insurance premiums payable under
Applicable Laws by it (the "Statutory Lien Payments") and has remitted such
amounts to the proper Governmental Authorities with the time required under the
Applicable Laws.
5.24 INVESTIGATIONS. There are no pending investigations, claims or
litigation by any Governmental Authority or other Person with respect to the
transactions contemplated by this Agreement and the other Loan Documents.
5.25 VEHICLES.
(a) Prior to the Closing Date, Borrowers have, or have
caused Guarantors to, (i) register, or cause to be registered, with the State of
Arizona each Vehicle (excluding any trailer) owned by any Borrower or any
Guarantor (other than U-Haul Co. of Alaska or U-Haul of Hawaii, Inc.) as of the
Closing Date and (ii) obtain a new certificate of title (collectively, the
"Certificates of Title" and, individually, a "Certificate of Title") for each
such Vehicle registered pursuant to clause (i) naming (1) (A) U-Haul (Canada) as
the registered owner of such Vehicles operated primarily in Canada, or (B)
U-Haul Co. of Arizona, an Arizona corporation, as the registered owner of all
other such Vehicles, (2) on new Certificates of Title obtained prior to May 21,
2003, "FOOTHILL CAPITAL CORP." as the first priority lienholder and (3) on new
Certificates of Title obtained on or after May 21, 2003, "WELLSFARGO FOOTHILL,
INC., AS AGENT" or, if space does or did not permit, "WELLSFARGO FOOTHILL
AGENT", as the first priority lienholder thereon.
(b) Prior to the Closing Date, Borrowers have, or have
caused U-Haul Co. of Alaska to, (i) register, or cause to be registered, with
the State of Alaska each Vehicle (excluding any trailer) owned by U-Haul Co. of
Alaska on or before the Closing Date, (ii) obtain a new Certificate of Title for
each such Vehicle registered pursuant to clause (i) naming (1) U-Haul Co. of
Alaska, an Alaskan corporation, as the registered owner and (2) "WELLSFARGO
FOOTHILL, INC., AS AGENT" or, if space does or did not permit, "WELLSFARGO
FOOTHILL AGENT", as the first priority lienholder thereon.
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(c) Prior to the Closing Date, Borrowers have, or have
caused U-Haul of Hawaii, Inc. to, (i) register, or cause to be registered, with
the State of Hawaii each Vehicle (excluding any trailer) owned by U-Haul of
Hawaii, Inc. on or before the Closing Date, (ii) obtain a new Certificate of
Title for each such Vehicle registered pursuant to clause (i) naming (1) U-Haul
of Hawaii, Inc., a Hawaiian corporation, as the registered owner and (2)
"WELLSFARGO FOOTHILL, INC., AS AGENT" or, if space does or did not permit,
"WELLSFARGO FOOTHILL AGENT", as the first priority lienholder thereon.
5.26 ANTI-TERRORISM LAWS.
(a) Anti-Terrorism Laws. None of Loan Parties nor any
Affiliate of any Loan Party is in violation of any Anti-Terrorism Law or
knowingly engages in or conspires to engage in any transaction that evades or
avoids, or has the purpose of evading or avoiding, or attempts to violate, any
of the prohibitions set forth in any Anti-Terrorism Law.
(b) Executive Order No. 13224. None of Borrowers nor any
Affiliate of any Borrower is any of the following (each a "Blocked Person"):
(i) a Person that is listed in the annex to, or
is otherwise subject to the provisions of, Executive Order No.
13224;
(ii) a Person owned or controlled by, or acting
for or on behalf of, any Person that is listed in the annex
to, or is otherwise subject to the provisions of, Executive
Order No. 13224;
(iii) a Person or entity with which any bank or
other financial institution is prohibited from dealing or
otherwise engaging in any transaction by any Anti-Terrorism
Law;
(iv) a Person or entity that commits, threatens
or conspires to commit or supports "terrorism" as defined in
Executive Order No. 13224;
(v) a Person or entity that is named as a
"specially designated national" on the most current list
published by OFAC at its official website or any replacement
website or other replacement official publication of such
list; or
(vi) a Person or entity who is affiliated with a
Person or entity listed above.
Neither any Borrower nor any Affiliate of any Borrower (i) conducts any business
or engages in making or receiving any contribution of funds, goods or services
to or for the benefit of any Blocked Person or (ii) deals in, or otherwise
engages in any transaction relating to, any property or interests in property
blocked pursuant to Executive Order No. 13224.
(c) OFAC. None of Borrowers nor any Affiliate of any
Borrower is in violation of any rules or regulations promulgated by OFAC or of
any economic or trade sanctions or engages in administered and enforced by OFAC
or conspires to engage in any
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transaction that evades or avoids, or has the purpose of evading or avoiding, or
attempts to violate, any of the prohibitions set forth in any rules or
regulations promulgated by OFAC.
6. AFFIRMATIVE COVENANTS.
Each Borrower covenants and agrees that, until termination of
all of the Commitments and payment in full of the Obligations, Borrowers shall
and shall cause each of their respective Subsidiaries to do all of the
following:
6.1 ACCOUNTING SYSTEM. Maintain a system of accounting that
enables such Loan Party to produce financial statements in accordance with GAAP
and maintain records pertaining to the Collateral that contain information as
from time to time reasonably may be requested by Agent.
6.2 COLLATERAL REPORTING. Administrative Borrower shall provide
Agent the following information (and if required by Agent, with copies to each
Lender) relating to the Collateral:
(a) On a monthly basis, in a form reasonably satisfactory
to Agent, (i) not later than the fifteenth (15th) day of each month, a summary
aging, by vendor, of each Loan Party's accounts payable, and (ii) not later than
the thirtieth (30th) day of each month, (A) a summary of any book overdraft and
(B) a report setting forth the Qualified Cash of each Loan Party.
(b) On a quarterly basis, not later than 15 days after
the end of each quarter, a report by gross book value and net book value of all
box-trucks, cargo vans and pickup trucks owned by Borrowers (and subject to
Agent's Lien) or Guarantors as of the last day of such quarter, together with a
reconciliation of any box-trucks, cargo vans and pickup trucks bought or sold
since the delivery of the prior report to Agent.
(c) Upon the delivery of any updated Fair Market
Valuation and on each date monthly financial statements are delivered to Agent,
a new Borrowing Base Certificate together with an updated schedule of Real
Property Collateral showing a reconciliation of any Real Property Collateral
bought or sold since the delivery of the prior Borrowing Base Certificate to the
Agent.
(d) On a quarterly basis, (i) a report of the name and
location of all U-Haul Dealers as of such date (the "Dealer List"), and (ii)
updated list of the Loan Parties' bank accounts, which schedule shall clearly
indicate any additions or deletions to such list from the list delivered to
Agent the preceding quarter.
6.3 FINANCIAL STATEMENTS, REPORTS, CERTIFICATES. Deliver to Agent,
with copies to each Lender:
(a) as soon as available, but in any event within 45 days
after the end of each month during each of Parent's fiscal years,
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(i) a company prepared Consolidated balance
sheet, income statement, and statement of cash flow covering
Parent's and its Subsidiaries' operations during such month
and the fiscal year to date, together with a comparison of
such financial statements to (A) Parent's Projections
delivered prior to the Closing Date or pursuant to Section
6.3(c) and (B) the Consolidated balance sheet, income
statement, and statement of cash flow covering Parent's and
its Subsidiaries' operations for such corresponding period in
the immediately preceding fiscal year,
(ii) a company prepared schedule detailing
Parent's Consolidated EBITDA as of the end of each month for
the 13-month period then ended,
(iii) a certificate signed by a chief financial
officer or a principal accounting officer of Parent to the
effect that:
(A) the financial statements and other
financial information delivered hereunder have been
prepared in accordance with GAAP (except for the lack
of footnotes and being subject to year-end audit
adjustments) and fairly present in all material
respects the financial condition of Parent and its
Subsidiaries,
(B) the representations and warranties
of Borrowers contained in this Agreement and the
other Loan Documents are true and correct in all
material respects on and as of the date of such
certificate, as though made on and as of such date
(except to the extent that such representations and
warranties relate solely to an earlier date), and
(C) there does not exist any condition
or event that constitutes a Default or Event of
Default (or, to the extent of any non-compliance,
describing such non-compliance as to which he or she
may have knowledge and what action Borrowers have
taken, are taking, or propose to take with respect
thereto), and
(iv) for each month that is the date on which a
financial covenant in Section 7.20 is to be tested, a
Compliance Certificate demonstrating, in reasonable detail,
compliance at the end of such period with the applicable
financial covenants contained in Section 7.20, together with a
reconciliation of the company prepared Consolidated balance
sheet, income statement, and statement of cash flow for Parent
and its Subsidiaries for the 3-month period then ended to the
audited financial statements contained in the 4 most recent
10-Q quarterly reports and the most recent Form 10-K annual
report filed by Parent and its Subsidiaries,
(b) as soon as available, but in any event within 120
days after the end of each of Parent's fiscal years,
(i) Consolidated financial statements of Parent
and its Subsidiaries for each such fiscal year, audited by
independent certified public accountants
83
reasonably acceptable to Agent and certified, without any
qualifications, by such accountants to have been prepared in
accordance with GAAP (such audited financial statements to
include a balance sheet, income statement, and statement of
cash flow and, if prepared, such accountants' letter to
management), and
(ii) a certificate of such accountants addressed
to Agent and the Lenders stating that such accountants do not
have knowledge of the existence of any Default or Event of
Default under Section 7.20,
(c) as soon as available, but in any event within 30 days
prior to the start of each of Parent's fiscal years, copies of Parent's
Projections, in form and substance (including as to scope and underlying
assumptions) reasonably satisfactory to the Lender Group, in its Permitted
Discretion, for the forthcoming 3 years, year by year, and for the forthcoming
fiscal year, month by month, certified by the chief financial officer of Parent
as being such officer's good faith best estimate of the financial performance of
Parent and its Subsidiaries on a Consolidated basis during the period covered
thereby,
(d) if, when and to the extent filed by any Loan Party
with the SEC or any other Governmental Authority,
(i) Form 10-Q quarterly reports, Form 10-K
annual reports, and Form 8-K current reports,
(ii) any other filings made by any Loan Party
with the SEC,
(iii) copies of Borrowers' federal income tax
returns, and any amendments thereto, filed with the IRS,
(iv) copies of any other reports or documents
delivered by a Loan Party to Xxxxx Fargo Bank, National
Association, as trustee, pursuant to Section 4.03 Term Loan B
Indenture, and
(v) any other information that is provided by
Parent to its shareholders generally,
(e) if and when filed by any Loan Party and as requested
by Agent, reasonably satisfactory evidence of payment of applicable excise and
property taxes in each jurisdictions in which (i) any Loan Party conducts
business, owns real property or is required to pay any such excise or real
property tax, (ii) where any Loan Party's failure to pay any such applicable
excise or property tax would result in a Lien on the properties or assets of any
Loan Party, or (iii) where any Loan Party's failure to pay any such applicable
excise tax reasonably could be expected to result in a Material Adverse Change,
(f) promptly after the commencement thereof, notice of
all actions, suits or proceedings brought by or against any Loan Party before
any Governmental Authority that, if determined adversely to such Loan Party,
could reasonably be expected to result in a Material Adverse Change,
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(g) as soon as a Borrower has knowledge of any event or
condition that constitutes a Default or an Event of Default, notice thereof and
a statement of the curative action that Borrowers propose to take with respect
thereto,
(h) as soon as a Borrower has actual knowledge of any
event or condition that constitutes a default or an event of default under the
New AMERCO Note Documents, the Term Loan B Note Documents, or any Funded Debt
(including, without limitation, any TRAC Lease Transaction, the PMCC Like Kind
Exchange Lease or the PMCC Leveraged Lease) or any notice, call, default of
event of default under any Support Party Agreement, notice thereof and a
statement of the curative action that Borrowers or Guarantors, as applicable,
propose to take with respect thereto, and
(i) upon the request of Agent or the Lender Group, any
other report reasonably requested relating to the financial condition of any
Loan Party.
In addition to the financial statements referred to above,
Borrowers agree to deliver financial statements prepared on both a consolidated
and consolidating basis (in accordance with GAAP) and a Consolidated basis (as
defined herein) and that, except for the Insurance Subsidiaries, no Borrower, or
any Subsidiary of a Borrower, will have a fiscal year different from that of
Parent. Borrowers agree to cooperate with Agent to allow Agent to consult with
their certified public accountants if Agent reasonably requests the right to do
so and that, in such connection, their independent certified public accountants
are authorized to communicate with Agent and to release to Agent whatever
financial information concerning Borrowers or their Subsidiaries that Agent
reasonably may request. Each Borrower waives the right to assert a confidential
relationship, if any, it may have with any accounting firm or service bureau in
connection with any information requested by Agent pursuant to or in accordance
with this Agreement, and agree that Agent may contact directly any such
accounting firm or service bureau in order to obtain such information; provided,
however, so long as no Event of Default has occurred and is continuing, Agent
shall give Borrowers a copy of any written request for information from Agent to
such accounting firm or bureau services and Borrowers shall have an opportunity
to attend any meeting between Agent and such accounting firm or bureau services
with respect to such information requests.
6.4 GUARANTOR REPORTS. Cause each Guarantor to deliver its annual
financial statements at the time when Parent provides its audited financial
statements to Agent, but only to the extent such Guarantor's Financial
Statements are not consolidated with Parent's Financial Statements, and copies
of all federal income tax returns as soon as the same are available and in any
event no later than 30 days after the same are required to be filed by law.
6.5 [INTENTIONALLY OMITTED.]
6.6 MAINTENANCE OF PROPERTIES. Maintain and preserve all of its
properties which are necessary or useful in the proper conduct of their business
in good working order and condition, ordinary wear and tear excepted, and comply
at all times with the provisions of all leases to which it is a party as lessee,
so as to prevent any loss or forfeiture thereof or thereunder.
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6.7 TAXES. Cause all assessments and taxes, whether real,
personal, or otherwise, due or payable by, or imposed, levied, or assessed
against any Borrower, any Subsidiary of a Borrower or any of their assets to be
paid in full, not less than 30 days before the earlier of (a) delinquency or (b)
the imposition of any additional amounts, fines or penalties or before the
expiration of any extension period, except to the extent that the validity of
such assessment or tax shall be the subject of a Permitted Protest. Each
Borrower will, and will cause each of its Subsidiaries to, make timely payment
or deposit of all tax payments and withholding taxes required of any Borrower or
its Subsidiaries under Applicable Laws, including the Canadian Income Tax Act,
Statutory Lien Payments, those laws concerning F.I.C.A., F.U.T.A., state or
provincial disability, and local, state, provincial and federal income taxes,
and will, upon request, furnish Agent with proof reasonably satisfactory to
Agent indicating that the applicable Borrower or its Subsidiary has made such
payments or deposits. Upon the request of Agent, Borrowers shall deliver
reasonably satisfactory evidence of payment of applicable excise taxes in each
jurisdiction in which any Borrower or its Subsidiary is required to pay any such
excise tax.
6.8 INSURANCE.
(a) At Borrowers' expense, maintain insurance respecting
their and their Subsidiaries' assets wherever located, covering loss or damage
by fire, theft, explosion, flood (with respect to any property or assets located
in a flood zone), earthquake (in the event the probable maximum loss with
respect to such property or assets is equal to or greater than 20), and all
other hazards and risks as ordinarily are insured against by other Persons
engaged in the same or similar businesses. Borrowers also shall (and shall cause
their Subsidiaries to) maintain business interruption, public liability, and
product liability insurance, as well as insurance against larceny, embezzlement,
and criminal misappropriation. All such policies of insurance shall be in such
amounts and with such insurance companies as are reasonably satisfactory to
Agent. Borrowers shall deliver copies of all such policies to Agent with a
satisfactory lender's loss payable endorsement naming Agent as loss payee or
additional insured, as appropriate and as its interests may appear. Each policy
of insurance or endorsement shall contain a clause requiring the insurer to give
not less than 30 days prior written notice to Agent in the event of cancellation
of the policy for any reason whatsoever.
(b) Administrative Borrower shall give Agent prompt
notice of any loss in excess of $100,000 for Vehicles or other personal property
covered by such insurance and any loss in excess of $500,000 for Real Property
covered by insurance. Other than with respect to Real Property subject to the
Synthetic Leases, Agent shall have the exclusive right to adjust any losses
payable under any such insurance policies in excess of $500,000 (or in any
amount during the existence of an Event of Default), without any liability to
Borrowers whatsoever in respect of such adjustments. Adjustments of any losses
with respect to Borrower's Real property subject to the Synthetic Leases shall
be subject to the terms thereof. Any monies received as payment for any loss
under any insurance policy mentioned above (other than liability insurance
policies) or as payment of any award or compensation for condemnation or taking
by eminent domain (other than any such award or compensation payable with
respect to Real Property subject to the Synthetic Leases), shall be paid over to
Agent to be applied at the option of the Required Lenders either to the
prepayment of the Obligations or shall be disbursed to Administrative Borrower
under staged payment terms reasonably satisfactory to the Required Lenders for
application to the cost of repairs, replacements, or restorations. Application
of any such award or
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compensation payable with respect to Real Property subject to the Synthetic
Leases shall be subject to the terms thereof. Any such repairs, replacements, or
restorations shall be effected with reasonable promptness and shall be of a
value at least equal to the value of the items or property destroyed prior to
such damage or destruction.
(c) Borrowers shall not, nor shall they permit any of the
Guarantors to, take out separate insurance concurrent in form or contributing in
the event of loss with that required to be maintained under this Section 6.8,
unless Agent is included thereon as named insured with the loss payable to Agent
under a lender's loss payable endorsement or its equivalent. Administrative
Borrower immediately shall notify Agent whenever such separate insurance is
taken out, specifying the insurer thereunder and full particulars as to the
policies evidencing the same, and copies of such policies promptly shall be
provided to Agent.
(d) Borrowers and Guarantors shall maintain their
insurance program with respect to the Vehicles as in effect on the Closing Date
with RepWest or, upon the consent of Agent, which consent shall not be
unreasonably withheld, with such other insurer as may be agreed upon by
Borrowers and Agent so long as the terms of such replacement self-insurance
program are reasonably similar to the insurance program with RepWest as of the
Closing Date.
6.9 LOCATION OF EQUIPMENT. Store the Equipment of Loan Parties
only at the Real Property and the locations of the U-Haul Dealers named on the
Dealer List, excluding (a) Vehicles in-transit from one U-Haul Dealer location
to another U-Haul Dealer location, (b) Vehicles that have been leased in the
ordinary course of Borrowers' and Guarantors' businesses and consistent with
their past practices anywhere in the United States and Canada, and (c) Vehicles
located at new U-Haul Dealers added subsequent to the most recently provided
Dealer List. Borrowers shall, or shall cause the Guarantors to, update the
Reservation Management System on a regular basis consistent with their past
practices and shall grant Agent access to such system upon Agent's request.
6.10 COMPLIANCE WITH LAWS. Comply with the requirements of all
Applicable Laws, rules, regulations, and orders of any Governmental Authority,
including the Fair Labor Standards Act and the Americans With Disabilities Act,
other than laws, rules, regulations, and orders the non-compliance with which,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Change.
6.11 LEASES.
(a) Pay when due all rents and other amounts payable
under any leases to which any Borrower or any Guarantor is a party or by which
any Borrower's or any Guarantor's properties and assets are bound, unless such
payments are the subject of a Permitted Protest, and
(b) Promptly exercise each one year renewal or extension
option available under each Synthetic Lease within the time period specified
therein.
6.12 BROKERAGE COMMISSIONS. Pay any and all brokerage commission or
finders fees incurred in connection with or as a result of Borrowers' obtaining
financing from the Lender Group under this Agreement. Borrowers agree and
acknowledge that payment of all such brokerage commissions or finders fees shall
be the sole responsibility of Borrowers, and each
87
Borrower agrees to indemnify, defend, and hold Agent and the Lender Group
harmless from and against any claim of any broker or finder arising out of
Borrowers' obtaining financing from the Lender Group under this Agreement.
6.13 EXISTENCE. At all times preserve and keep in full force and
effect each Borrower's and each Guarantor's valid existence and good standing
and any rights, licenses, permits and franchises material to Borrowers' and
Guarantors' businesses.
6.14 ENVIRONMENTAL.
(a) Keep any property either owned or operated by any
Loan Party free of any Environmental Liens or post bonds or other financial
assurances sufficient to satisfy the obligations or liability evidenced by such
Environmental Liens, (b) comply, in all material respects, with Environmental
Laws and provide to Agent documentation of such compliance which Agent
reasonably requests, (c) promptly notify Agent of any release of a Hazardous
Material of any reportable quantity from or onto property owned or operated by
any Loan Party and take any Remedial Actions required to xxxxx said release or
otherwise to come into compliance with applicable Environmental Law, and (d)
promptly, but in any event within 5 days of its receipt thereof, provide Agent
with written notice of the receipt of any of the following: (i) notice that an
Environmental Lien has been filed against any of the real or personal property
of any Loan Party, (ii) commencement of any Environmental Action or notice that
an Environmental Action will be filed against any Loan Party, and (iii) notice
of a violation, citation, or other administrative order which reasonably could
be expected to result in a Material Adverse Change.
6.15 DISCLOSURE UPDATES. Promptly and in no event later than 5
Business Days after obtaining knowledge thereof, notify Agent if any written
information, exhibit, or report furnished to the Lender Group contained any
untrue statement of a material fact or omitted to state any material fact
necessary to make the statements contained therein not misleading in light of
the circumstances in which made. The foregoing notwithstanding, any notification
pursuant to the foregoing provision will not cure or remedy the effect of the
prior untrue statement of a material fact or omission of any fact nor shall any
such notification have the effect of amending or modifying this Agreement or any
of the Schedules hereto.
6.16 MATERIAL CONTRACTS; AFFILIATE CONTRACTS. In the event any
Borrower or Guarantor shall enter into any Material Contract or, subject to
Section 7.14, any new Affiliate Contract, after the Closing Date, deliver to
Agent, within 30 days of entering into such Material Contract or Affiliate
Contract, an updated Schedule M-1 or Schedule A-1, as applicable, reflecting the
addition of such Material Contract or Affiliate Contract, together with a copy
of such executed Material Contract or Affiliate Contract. Each Borrower and
Guarantor shall also provide Agent with an executed copy of any contract with
any of SAC Holding, SSI, PMSR or PM Preferred executed after the Closing Date.
6.17 EMPLOYEE BENEFITS.
(a) (i) Promptly, and in any event within 10 Business
Days after any Borrower or any Subsidiary of a Borrower knows or should know
that an ERISA Event has
88
occurred that reasonably could be expected to result in a Material Adverse
Change, deliver to Agent a written statement of the chief financial officer of
Parent describing such ERISA Event and any action that is being taking with
respect thereto by any such Borrower, any such Subsidiary or ERISA Affiliate,
and any action taken or threatened by the IRS, Department of Labor, or PBGC, and
such Borrower or such Subsidiary, as applicable, shall be deemed to know all
facts known by the administrator of any Benefit Plan of which it is the plan
sponsor, (ii) promptly, and in any event within 3 Business Days after the filing
thereof with the IRS, deliver to Agent a copy of each funding waiver request
filed with respect to any Benefit Plan and all communications received by any
Borrower, any Subsidiary of a Borrower or, to the knowledge of such Borrower,
any ERISA Affiliate with respect to such request, and (iii) promptly, and in any
event within 3 Business Days after receipt by any Borrower, deliver to Agent any
Subsidiary of a Borrower or, to the knowledge of any Borrower, any Subsidiary,
any ERISA Affiliate, of the PBGC's intention to terminate a Benefit Plan or to
have a trustee appointed to administer a Benefit Plan, copies of each such
notice.
(b) Cause to be delivered to Agent, upon Agent's request,
each of the following: (i) a copy of each Benefit Plan (or, where any such plan
is not in writing, complete description thereof) (and if applicable, related
trust agreements or other funding instruments) and all amendments thereto, all
written interpretations thereof and written descriptions thereof that have been
distributed to employees or former employees of any Borrower or its
Subsidiaries; (ii) the most recent determination letter issued by the IRS with
respect to each Benefit Plan; (iii) for the 3 most recent plan years, annual
reports on Form 5500 Series required to be filed with any governmental agency
for each Benefit Plan; (iv) all actuarial reports prepared for the last 3 plan
years for each Benefit Plan; (v) a listing of all Multiemployer Plans, with the
aggregate amount of the most recent annual contributions required to be made by
any Borrower, any Subsidiary of a Borrower, or any ERISA Affiliate to each such
plan and copies of the collective bargaining agreements requiring such
contributions; (vi) any information that has been provided to any Borrower, any
Subsidiary of a Borrower or any ERISA Affiliate regarding withdrawal liability
under any Multiemployer Plan; and (vii) the aggregate amount of the most recent
annual payments made to former employees of any Borrower or its Subsidiaries
under any Retiree Health Plan.
6.18 REAL ESTATE. If at any time after the Closing Date, any
Borrower or any Guarantor acquires any fee interest in Real Property with a fair
market valuation in excess of $250,000, such Borrower shall, or Borrowers shall
cause such Guarantor to, promptly execute, deliver and record a first priority
Mortgage in favor of Agent covering such Real Property interest, in form and
substance reasonably satisfactory to Agent, and provide (a) the Agent with a
Mortgage Policy insuring the first priority Lien of said Mortgage in such Real
Property encumbered thereby in an amount reasonably acceptable to Agent and
subject only to Permitted Liens and to such other exceptions as are reasonably
satisfactory to Agent, (b) a satisfactory legal description of such property and
an opinion from special counsel to such Borrower or Guarantor, (c) to the extent
necessary under Applicable Laws, Uniform Commercial Code financing statements
covering fixtures, in each case appropriately completed and duly executed, for
filing in the appropriate county land office and (d) evidence that such Person
shall have paid to the applicable title insurance company all expenses of such
title insurance company in connection with the issuance of such reports and in
addition shall have paid to such title insurance company an amount equal to the
recording and stamp taxes (including mortgage recording taxes), if any,
89
payable in connection with recording such Mortgages in the appropriate county
land offices. In addition, each such Borrower or Guarantor delivering a Mortgage
pursuant to this Section 6.18 shall deliver a copy of all existing phase-I or
phase-II environmental reports with respect to such Real Property to Agent and,
upon the reasonable request of Agent, cause to be performed, at Borrowers' joint
and several cost and expense, phase-I or phase-II environmental audits, in form
and substance and by an independent firm reasonably satisfactory to Agent.
6.19 REORGANIZATION PLAN. Comply in all material respects with the
provisions of the Reorganization Plan.
6.20 VEHICLES.
(a) (i) Deposit all Certificates of Title into a
segregated, secured location at Parent's chief executive office located at 2727
North Central, Phoenix, Arizona, the access to which shall be limited to Agent,
its representatives and agents, Xxxxxxx Xxxxxx and Xxxx Xxxxxx and such
Certificates of Title and such Persons shall be covered by a fidelity insurance
policy naming Agent as loss payee or a bond endorsed to Agent, in either case in
form and substance reasonably satisfactory to Agent (which shall include
coverage of at least $5,000,000), and (ii) timely pay all fees required by the
States of Alaska, Arizona and Hawaii, as applicable, with respect to such
Vehicle registrations and the issuances of the corresponding Certificates of
Title.
(b) (i) Follow the procedures set forth in Section
5.25(a), Section 5.25(b) and Section 5.25(c), as applicable, and Section 6.20(a)
with respect to any Vehicle (excluding any trailer) acquired by any Borrower or
Guarantor after the Closing Date that is not intended to be transferred into a
TRAC Lease Transaction within 130 days of the acquisition of such Vehicle, and
(ii) pursuant to the laws of the States of Alaska, Arizona and Hawaii, as
applicable, timely renew all registrations and Certificates of Title held by
Borrowers with respect to the Vehicles.
(c) Borrowers hereby acknowledge and agree that (i) they
shall hold and maintain all Certificates of Title on behalf of, and as an
attorney-in-fact and agent for, Agent, (ii) Agent's security interest in, Liens
on, and all rights and remedies with respect to the Vehicles and the
Certificates of Title shall remain valid and enforceable at all times, and (iii)
during the existence of an Event of Default or if Agent is not satisfied with
the results of any inspection under Section 4.6(b), Borrowers shall, or shall
cause the Guarantors to, promptly comply with any request or direction by Agent
to deliver the Certificates of Title to Agent or to such other Person or
location as Agent may direct in its Permitted Discretion.
(d) Execution of this Agreement shall be evidence of each
Borrower's consent to the Lien of Agent on the Vehicles indicated on the
Certificates of Title.
7. NEGATIVE COVENANTS.
Each Borrower covenants and agrees that, until termination of
all of the Commitments and payment in full of the Obligations, Borrowers will
not and will not permit any of their respective Subsidiaries (excluding the
Insurance Subsidiaries) to do any of the following:
7.1 INDEBTEDNESS, ETC. Create, incur, assume, suffer to exist,
guarantee, or otherwise become or remain, directly or indirectly, liable with
respect to any Indebtedness, except:
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(a) Indebtedness evidenced by this Agreement and the
other Loan Documents, together with Indebtedness owed to Underlying Issuers with
respect to Underlying Letters of Credit;
(b) Indebtedness in existence as of the Closing Date,
which in the case of Funded Debt shall be issued pursuant to documentation
provided to Agent prior to the Closing Date, as set forth on Schedule 5.20(a)
and obligations to make payments required under the Reorganization Plan;
(c) (i) Purchase Money Indebtedness and Capitalized Lease
Obligations (other than Capital Leases of the type set forth in clause (ii) of
this Section 7.1(c)) incurred after the Closing Date in an aggregate amount not
to exceed $30,000,000, and (ii) Capital Leases, to the extent such Capital
Leases arise out of the treatment of any of the Synthetic Leases (including any
refinancings, in whole or in part, thereof) as Capital Leases in accordance with
the requirements of GAAP;
(d) Indebtedness under the New AMERCO Notes and the Term
Loan B Notes;
(e) guarantees permitted under Section 7.6;
(f) Indebtedness comprising Permitted Investments;
(g) Indebtedness with respect to letters of credit issued
by a party other than the Issuing Lender and secured by cash collateral in an
aggregate amount not to exceed $3,000,000 at any time; and
(h) refinancings, renewals, or extensions of Indebtedness
permitted under clauses (b) and (c) of this Section 7.1 (and continuance or
renewal of any Permitted Liens associated therewith) (specifically excluding the
Term Loan B Notes and the New AMERCO Notes) so long as: (i) the terms and
conditions of such refinancings, renewals, or extensions do not, in Agent's
Permitted Discretion, materially impair the prospects of repayment of the
Obligations by Borrowers or materially impair Borrowers' creditworthiness, (ii)
such refinancings, renewals, or extensions do not result in an increase in the
principal amount (other than capitalized fees and, with respect to any
refinancing of the Synthetic Leases, to the extent they are treated as Capital
Leases in accordance with GAAP, any increases directly attributable to
improvements on or to the Real Property covered by such Synthetic Leases) of, or
interest rate beyond a prevailing market rate with respect to, the Indebtedness
so refinanced, renewed, or extended, (iii) such refinancings, renewals, or
extensions do not result in a shortening of the average weighted maturity of the
Indebtedness so refinanced, renewed, or extended (other than such changes in the
average weighted maturity of the Synthetic Leases, to the extent they are
treated as Capital Leases in accordance with GAAP, resulting from the
refinancing, in whole or in part, of the Synthetic Leases pursuant to the WP
Xxxxx Transaction or other refinancing transaction in form and substance
reasonably satisfactory to Required Lenders), nor are they on terms or
conditions, that, taken as a whole, are materially more burdensome or
restrictive to the applicable Borrower, and (iv) if the Indebtedness that is
refinanced, renewed, or extended was subordinated in right of payment to the
Obligations, then the terms and conditions of the
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refinancing, renewal, or extension Indebtedness must include subordination terms
and conditions that are at least as favorable to the Lender Group as those that
were applicable to the refinanced, renewed, or extended Indebtedness.
7.2 LIENS. Create, incur, assume, or permit to exist, directly or
indirectly, any Lien on or with respect to any of its assets, of any kind,
whether now owned or hereafter acquired, or any income or profits therefrom,
except for Permitted Liens.
7.3 RESTRICTIONS ON FUNDAMENTAL CHANGES.
(a) Enter into any merger, consolidation, reorganization,
or recapitalization, or reclassify its Stock (other than in connection with the
Reorganization Plan), except that, so long as no Default or Event of Default
then exists hereunder or would be caused thereby and the Agent receives written
notice of any such merger at least 30 days prior to the effectiveness thereof if
such merger involves a Loan Party: (i) any Subsidiary that is not a Loan Party
may merge into any other Subsidiary that is not a Loan Party, and (ii) any Loan
Party (other than Parent, U-Haul or AREC) may merge into any other Loan Party
(other than Parent, U-Haul or AREC); provided, however, (x) the Person surviving
such merger shall be a Loan Party, and (y) Agent shall have received, upon the
effectiveness of such merger, such loan documents, title insurance and opinions
of counsel as Agent may reasonably request to continue or insure the priority
and perfection of Agent's liens on the Collateral or the obligations of any such
Loan Party under any of the Loan Documents, including, without limitation, the
documents required by Section 7.13(b) hereof. Notwithstanding the foregoing, a
Subsidiary that is not an Insurance Subsidiary shall not merge with any
Insurance Subsidiary.
(b) Liquidate, wind up, or dissolve any Borrower or any
Borrower's Subsidiaries (or suffer any liquidation or dissolution), except that
Parent may liquidate, dissolve or wind up any Subsidiary (other than AREC and
U-Haul or any Insurance Subsidiary) so long as (i) no Default or Event of
Default then exists hereunder or would be caused thereby and the Agent receives
written notice of any such action at least 30 days prior to the effectiveness
thereof, (ii) the assets of such Subsidiary are transferred to another
Subsidiary of Parent or, if such Subsidiary is a Loan Party, to another Loan
Party and such assets remain subject to a first priority (subject to Permitted
Liens) perfected Lien under a Loan Document after such transfer, (iii) Agent
shall have received such loan documents, title insurance and opinions of counsel
as Agent may request to continue or insure the priority and perfection of
Agent's liens on such assets or the obligations of any such Subsidiary under any
of the Loan Documents, including, without limitation, the documents required by
Section 7.13(b) hereof. Notwithstanding the foregoing, a dissolving or
liquidating Subsidiary that is not an Insurance Subsidiary shall not transfer
assets to any Insurance Subsidiary.
7.4 DISPOSAL OF ASSETS. Other than Permitted Dispositions, convey,
sell, lease, license, assign, transfer, or otherwise dispose of, in one
transaction or a series of transactions, any of the assets of any Borrower or
any Guarantor. To the extent a sale or other disposition is permitted by clause
(k) of the definition of Permitted Dispositions and if an Authorized Officer of
Parent certifies in writing to Agent that (a) the sale is permitted under this
Section 7.4, (b) the Vehicles identified (by vehicle identification number, make
and model) in such certification are to be sold in connection with a TRAC Lease
Transaction and (c) such Vehicles are to be sold on
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a date (each such date, a "Sale Date") no later than 130 days from the date of
such certification, Agent's Lien on such Vehicles shall be deemed to be released
1 Business Day prior to such sale; provided, however, that in the event one or
more of such Vehicles are not sold in connection with a TRAC Lease Transaction
within 5 Business Days of the Sale Date indicated in such certification, the
Vehicles that are not so sold shall become subject to a Lien in favor of Agent
on the fifth Business Day following such Sale Date and Borrowers shall, or shall
cause Guarantors to, comply immediately with the requirements of this Agreement
with respect to such Vehicles, including, without limitation, Section 6.20
hereof. Borrowers shall not, without the prior consent of Agent, (x) transfer,
sell or otherwise dispose of any of the Vehicles or the Certificates of Title
except in conjunction with a Permitted Disposition hereunder, or (y) relocate
the Certificates of Title.
7.5 CHANGE NAME. Change any Borrower's or Guarantor's name, FEIN,
Organizational ID Number, corporate structure, or identity, or add any new
fictitious name, or reincorporate or reorganize itself under the laws of any
jurisdiction other than the jurisdiction set forth on Schedule 5.7; provided,
however, that a Borrower or Guarantor may change its name upon at least 30 days'
prior written notice by Administrative Borrower to Agent of such change and so
long as, at the time of such written notification, such Borrower provides or
authorizes the filing of any Uniform Commercial Code financing statements or
fixture filings necessary to perfect and continue perfected Agent's Liens.
7.6 GUARANTEE. Guarantee or otherwise become in any way liable
with respect to the obligations of any third Person (including the Insurance
Subsidiaries) except by endorsement of instruments or items of payment for
deposit to the account of Borrowers or Guarantors or which are transmitted or
turned over to Agent, except for (a) guarantee obligations of Parent existing as
of Closing Date, (b) guarantee obligations of Parent in connection with the
Reorganization Plan, (c) guarantee obligations of Parent with respect to the
Support Party Agreements, (d) guarantee obligations with respect to TRAC Lease
Transactions in the ordinary course of business, to the extent the obligations
thereunder are permitted by this Agreement and are consistent with past
practices, (e) guarantee obligations of a Loan Party pursuant to any
refinancing, renewal or extension of Indebtedness permitted pursuant to Section
7.1(h) hereof, and (f) guarantee obligations of a Loan Party with respect to the
obligations of any other Loan Party incurred in the ordinary course of business,
to the extent such guaranteed obligation is permitted to be incurred by such
guaranteed Loan Party hereunder and is consistent with past practices.
7.7 NATURE OF BUSINESS. Make any change in the principal nature of
any Borrower's or any Subsidiary's business.
7.8 PREPAYMENTS AND AMENDMENTS.
(a) Prepay, redeem, defease, purchase, or otherwise
acquire any Indebtedness of any Loan Party, other than (i) the DIP Obligations;
(ii) as required by the Confirmation Order; (iii) Obligations in accordance with
this Agreement; (iv) in connection with a refinancing permitted by Section
7.1(h); (v) (1) prepayments of the Indebtedness under the New AMERCO Notes, from
the proceeds from the monetization or sale of the Excluded Assets, or (2) so
long as no Event of Default Exists, other prepayments of Indebtedness under the
Term Loan B Notes or the New AMERCO Notes so long as (A) the aggregate amount of
such prepayments in any fiscal
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year, together with the aggregate amount of prepayments in such fiscal year by
Borrowers pursuant to clause (3) of Section 7.8(a)(vi) plus the aggregate amount
of dividends paid in arrears in such fiscal year by Borrowers pursuant to clause
(c) of Section 7.11, shall not, in the aggregate, exceed the ECF Carry Forward
Amount, if any, then in existence, and (B) on the date of such prepayment
Borrowers are in compliance with the Excess Availability Test; (vi) (1)
prepayments of the Indebtedness under the Synthetic Leases with insurance
proceeds or condemnation proceeds received by a Loan Party in connection with
any loss or condemnation of the Synthetic Lease Collateral, (2) prepayments of
the Indebtedness under the Synthetic Leases upon the sale of any parcel of the
Real Property subject to the Synthetic Leases pursuant to an arms-length sale to
a bona fide purchaser that is not an Affiliate of Parent (whether or not an
Affiliate leases back or retains the right to manage, occupy or conduct business
at the affected Synthetic Lease Property), up to the amount of the net sale
proceeds, or (3) so long as no Event of Default exists, any other prepayments of
principal Indebtedness required pursuant to the provisions of the Synthetic
Leases, so long as (I) the aggregate amount of such prepayments in any fiscal
year, together with the aggregate amount of prepayments in such fiscal year by
Borrowers pursuant to clause (2) of Section 7.8(a)(v) plus the aggregate amount
of dividends paid in arrears in such fiscal year by Borrowers pursuant to clause
(c) of Section 7.11, shall not, in the aggregate, exceed the ECF Carry Forward
Amount, if any, then in existence, and (II) on the date of such prepayment
Borrowers are in compliance with the Excess Availability Test, (vii) in addition
to the principal payments under the Synthetic Leases to be made on the Effective
Date as contemplated by the Reorganization Plan, the actual scheduled payments
of principal and interest due under the Synthetic Leases, estimates of which are
set forth on Schedule 7.8(a) (including any refinancings, in whole or in part,
thereof), or (viii) other Indebtedness with the consent of the Required Lenders.
(b) Except in connection with a refinancing permitted by
Section 7.1(h), directly or indirectly, amend, modify, alter, increase, or
change any of the terms or conditions of any agreement, instrument, document,
indenture, or other writing evidencing or concerning Indebtedness permitted
under Section 7.1 (excluding any amendment to the Term Loan B Note Indenture
that must be made pursuant to Section 9.07 thereof).
(c) Amend, modify or otherwise change its Governing
Documents, including, without limitation, by the filing or modification of any
certificate of designation, or any agreement or arrangement entered into by it
with respect to any of its capital Stock (including any shareholders'
agreement), or enter into any new agreement with respect to any of its capital
Stock, except as appropriate to accomplish a transaction permitted pursuant to
Section 7.3(a) or Section 7.3(b), or (ii) amend, modify or otherwise change any
Material Contract (other than a Material Contract the amendment of which is
governed by clause (b) above) except any such amendments, modifications or
changes or any such new agreements or arrangements pursuant to this paragraph
(c) that, either individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Change, or (iii) amend, modify or otherwise
change any Affiliate Contract or any contract with SAC Holding, SSI, PMSR or PM
Preferred except in compliance with Section 7.14 hereof.
7.9 CHANGE OF CONTROL. Cause, permit, or suffer, directly or
indirectly, any Change of Control, other than in connection with the
consummation of the Reorganization Plan on the Effective Date.
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7.10 OWNERSHIP OF CERTAIN ASSETS. Cause, permit, or suffer any
Subsidiary, other than Borrowers and U-Haul (Canada), to own any parcel of Real
Property Collateral or any Vehicle included in the Collateral unless (a)
Administrative Borrower provides Agent with 10 days' prior written notice of
such intended ownership, and (b) such Subsidiary becomes a Borrower under this
Agreement and delivers to Agent any Additional Documents requested by Agent in
its Permitted Discretion to perfect its Lien on such assets.
7.11 DISTRIBUTIONS. Make any distribution or declare or pay any
dividends (in cash or other property, other than common Stock) on, or purchase,
acquire, redeem, or retire any of any Loan Party's Stock, of any class, whether
now or hereafter outstanding, except, so long as no Event of Default has
occurred and is continuing hereunder or would result therefrom, distributions or
declarations and payments of dividends: (a) by a Borrower to another Borrower or
by a Guarantor to another Loan Party, (b) on the preferred stock of Parent,
based on the accrual of dividends subsequent to the Closing Date (including,
without limitation, the payment of dividends in an aggregate amount not to
exceed $3,335,000 paid on account of dividends on the preferred stock of Parent
accrued for the period ended February 29, 2004), in an aggregate amount not to
exceed $13,000,000 in any fiscal year, so long as at the time of payment of any
such dividend, Borrowers are in compliance with the Excess Availability Test,
and (c) on the preferred stock of Parent, based on the accrual of dividends
prior to the Closing Date (including, without limitation, the payment of
dividends in an aggregate amount not to exceed $3,335,000 paid on account of
dividends on the preferred stock of Parent accrued prior to or for the period
ended November 30, 2003), so long as (i) the aggregate amount of such dividends
in arrears shall not exceed the lesser of (x) $19,600,000 paid in the aggregate
on or after the Closing Date or (y) together with the aggregate amount of any
prepayments paid by Borrowers in such fiscal year pursuant to clause (2) of
Section 7.8(a)(v) plus the aggregate amount of any prepayments paid by Borrowers
in such fiscal year pursuant to clause (3) of Section 7.8(a)(vi), the ECF Carry
Forward Amount, if any, then in existence, and (ii) at the time of payment of
any such dividend in arrears, Borrowers are in compliance with the Excess
Availability Test.
7.12 ACCOUNTING METHODS. Modify or change their fiscal year from a
year ending March 31 or their method of accounting (other than as may be
required to conform to GAAP) or enter into, modify, or terminate any agreement
currently existing, or at any time hereafter entered into with any third party
accounting firm or service bureau for the preparation or storage of Borrowers'
or their Subsidiaries' accounting records without said accounting firm or
service bureau agreeing to provide Agent information regarding the Collateral or
Borrowers' and their Subsidiaries financial condition.
7.13 FORMATION OF SUBSIDIARIES; INVESTMENTS.
(a) Except for Permitted Investments, directly or
indirectly, make or acquire any Investment, or incur any liabilities (including
contingent obligations) for or in connection with any Investment; provided,
however, that Parent and its Subsidiaries shall not (i) have Permitted
Investments (other than in the Cash Management Accounts) in Deposit Accounts or
Securities Accounts in excess of $3,000,000 in the aggregate outstanding at any
one time (excluding (x) Deposit Accounts or Securities Accounts containing only
the cash proceeds received from the WP Xxxxx Transaction (to the extent such
proceeds will be fully utilized in such transaction), and any proceeds from the
monetization of Excluded Assets, and (y) any
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Deposit Accounts maintained by U-Haul solely in its capacity as manager of
properties owned by SAC Holding or SSI under a Management Agreement provided
U-Haul has no rights to or interest in the funds deposited therein) unless
Parent or any of its Subsidiaries, as applicable, and the applicable securities
intermediary or bank have entered into Control Agreements or similar
arrangements governing such Permitted Investments, as Agent shall determine in
its Permitted Discretion, to perfect (and further establish) the Agent's Liens
in such Permitted Investments, or (ii) forgive or waive the repayment or
retirement or amend the terms of any Investment in existence on or after the
Closing Date in SAC Holding or any such Person made by the Parent or any
Subsidiary that is required to be repaid or retired by the terms of such
Investment as in effect on or after the Closing Date (other than in accordance
with the terms thereof as in effect on the date the Investment is made).
(b) Form any new Subsidiary or acquire any direct or
indirect Subsidiary after the Closing Date, unless (i) such Subsidiary is a
wholly-owned Subsidiary of a Loan Party, and such Loan Party shall (x) cause
such new Subsidiary to provide to Agent a joinder to this Agreement or the
Guaranty, the Guarantor Security Agreement, the Copyright Security Agreement,
and the Patent and Trademark Security Agreement, together with such other
security documents (including Mortgages with respect to any Real Property of
such new Subsidiary), as well as appropriate Uniform Commercial Code financing
statements (and with respect to all property subject to a Mortgage, fixture
filings), all in form and substance satisfactory to Agent (including being
sufficient to grant Agent a first priority Lien (subject to Permitted Liens) in
and to the assets of such newly formed or acquired Subsidiary), (y) provide to
Agent a pledge agreement and appropriate certificates and powers or Uniform
Commercial Code financing statements, hypothecating all of the direct or
beneficial ownership interest in such new Subsidiary, in form and substance
satisfactory to Agent, and (z) provide to Agent all other documentation,
including one or more opinions of counsel satisfactory to Agent, which in its
opinion is appropriate with respect to the execution and delivery of the
applicable documentation referred to above (including policies of title
insurance or other documentation with respect to all property subject to a
Mortgage), and (ii) Agent receives 30 days' prior written notice of such
formation or acquisition. Any document, agreement, or instrument executed or
issued subject to this Section 7.13(b) shall be a Loan Document.
7.14 TRANSACTIONS WITH AFFILIATES. Except (a) as otherwise set
forth in the Reorganization Plan, (b) for Parent's reimbursement to, or payment
on behalf of, SAC Holding, of (i) reasonable attorneys' fees incurred by SAC
Holding in connection with the preparation, negotiation and implementation of
the SAC Participation and Subordination Agreement, not to exceed an aggregate
amount of $500,000, (ii) any and all reasonable direct out of pocket expenses
(including reasonable attorneys' fees and accountants' fees and trustee's fees,
but excluding the payment of principal, premium, if any, and interest in respect
of the SAC Holding Senior Bond and any other amount payable by SAC Holding
pursuant to the terms of the SAC Note Indenture) incurred by SAC Holding in
connection with its reporting or other compliance obligations under the SAC
Notes Indenture in an aggregate amount not to exceed $1,000,000 in any 12-month
period, and (iii) Parent's obligations under the Agreement to Indemnify, or (c)
as consented to by Agent and the Required Lenders, directly or indirectly, enter
into or permit to exist any transaction with any Affiliate of any Borrower, SAC
Holding, SSI, PMSR or PM Preferred except for transactions that are in the
ordinary course of Borrowers' business, upon fair and reasonable terms, that are
fully disclosed to Agent, and that are no less favorable to
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Borrowers than would be obtained in an arm's length transaction with a
non-Affiliate. Borrowers shall not, and shall not permit any of their
Subsidiaries to, transfer any cash or assets to the Insurance Subsidiaries, the
Dormant Subsidiaries or INW under any circumstances whatsoever or guarantee or
otherwise incur any Indebtedness on behalf of such Insurance Subsidiaries,
Dormant Subsidiaries or INW.
7.15 SUSPENSION. Except as permitted by Section 7.3, suspend or go
out of a substantial portion of its business.
7.16 [INTENTIONALLY OMITTED.]
7.17 USE OF PROCEEDS. Use the Letters of Credit and the proceeds of
the Advances and the Term Loan for any purpose other than (a) on the Closing
Date, (i) to pay transactional fees, costs, and expenses incurred in connection
with this Agreement, the other Loan Documents, and the transactions contemplated
hereby and thereby, (ii) to repay, in full, the outstanding DIP Obligations, and
(iii) to fund the Reorganization Plan and (b) thereafter, for working capital
and other general corporate purposes of Borrowers, in each case consistent with
the terms and conditions hereof, for its lawful and permitted purposes.
7.18 CHANGE IN LOCATION OF CHIEF EXECUTIVE OFFICE; EQUIPMENT WITH
BAILEES. Relocate its chief executive office to a new location without
Administrative Borrower providing 30 days' prior written notification thereof to
Agent and so long as, at the time of such written notification, the applicable
Borrower provides or authorizes, at the request of Agent, the filing of any
Uniform Commercial Code financing statements or fixture filings necessary to
perfect and continue perfected the Agent's Liens and also provides to Agent a
Collateral Access Agreement, a form of which Agent shall provide to
Administrative Borrower, with respect to such new location. The Equipment of
Borrowers and Guarantors shall not at any time now or hereafter be stored with a
bailee, warehouseman, or similar party (other than a U-Haul Dealer) without
Agent's prior written consent.
7.19 SECURITIES ACCOUNTS. Establish or maintain any Securities
Account unless Agent shall have received a Control Agreement in respect of such
Securities Account. No Loan Party shall transfer assets out of any Securities
Account; provided, however, that, so long as no Event of Default has occurred
and is continuing or would result therefrom, such Loan Party may use such assets
(and the proceeds thereof) to the extent not prohibited by this Agreement.
7.20 FINANCIAL COVENANTS.
(a) EBITDA/CAPITAL EXPENDITURES. Allow Consolidated
EBITDA minus Capital Expenditures, each as measured on a fiscal quarter-end
basis for the applicable period set forth below, to be less than the required
amount set forth in the following table as of the applicable date set forth
opposite thereto:
Applicable Amount Applicable Date
----------------- ---------------
$15,000,000 For the 3-month period
ending June 30, 2004
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Applicable Amount Applicable Date
----------------- ---------------
$65,000,000 For the 6-month period
ending September 30, 2004
$65,000,000 For the 9-month period
ending December 31, 2004
$60,000,000 For the 12-month period
ending March 31, 2005
$48,000,000 For the 12-month period
ending June 30, 2005
$25,000,000 For the 12-month period
ending September 30, 2005
$25,000,000 For the 12-month period
ending December 31, 2005
$30,000,000 For the 12-month period
ending March 31, 2006
$80,000,000 For the 12-month period
ending June 30, 2006
$115,000,000 For the 12-month period
ending September 30, 2006
$110,000,000 For the 12-month period
ending December 31, 2006
$105,000,000 For the 12-month period
ending March 31, 2007
; provided, however, that based upon Borrowers' Projections delivered to Agent
pursuant to Section 6.3(c), the Required Lenders shall establish quarterly
EBITDA minus Capital Expenditure covenants for each fiscal quarter after March
2007, using the same methodology as utilized for 2004, 2005 and 2006, and the
covenants shall be presented to Administrative Borrower for its approval, which
approval shall not be unreasonably withheld. In the event Administrative
Borrower does not approve the proposed covenants, Required Lenders shall
establish such covenants, in their Permitted Discretion, based upon Borrowers'
Projections for the applicable fiscal year.
(b) CAPITAL EXPENDITURES. Make Capital Expenditures in
any fiscal year in excess of the amount set forth in the following table for the
applicable period:
Fiscal Year 2005 Fiscal Year 2006 Fiscal Year 2007
---------------- ---------------- ----------------
$185,000,000 $245,000,00 $195,000,000
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; provided, however, that based upon Borrowers' Projections delivered to Agent
pursuant to Section 6.3(c), the Required Lenders shall establish quarterly
Capital Expenditure covenants for each fiscal year after 2007, using the same
methodology as utilized for 2005, 2006 and 2007, and the covenants shall be
presented to Administrative Borrower for its approval, which approval shall not
be unreasonably withheld. In the event Administrative Borrower does not approve
the proposed covenants, Required Lenders shall establish such covenants, in
their Permitted Discretion, based upon Borrowers' Projections for the applicable
fiscal year.
7.21 NO PROHIBITED TRANSACTIONS UNDER ERISA. Directly or
indirectly:
(a) engage, or permit any Subsidiary of any Borrower to
engage, in any prohibited transaction which is reasonably likely to result in a
civil penalty or excise tax described in Sections 502(i) of ERISA or 4975 of the
IRC for which a statutory or class exemption is not available or a private
exemption has not been previously obtained from the Department of Labor;
(b) with respect to any Benefit Plan, permit to exist an
accumulated funding deficiency (as defined in Sections 302 of ERISA and 412 of
the IRC) for a period longer than 30 days, whether or not waived;
(c) fail, or permit any Subsidiary of any Borrower to
fail, to pay timely required contributions or annual installments due with
respect to any waived funding deficiency to any Benefit Plan;
(d) terminate, or permit any Subsidiary of any Borrower
to terminate, any Benefit Plan where such event would result in any liability of
any Borrower, any Subsidiary of any Borrower or any ERISA Affiliate under Title
IV of ERISA;
(e) fail, or permit any Subsidiary of any Borrower to
fail, to make any required contribution or payment to any Multiemployer Plan;
(f) fail, or permit any Subsidiary of any Borrower to
fail, to pay any required installment or any other payment required under
Section 412 of the IRC on or before the due date for such installment or other
payment;
(g) amend, or permit any Subsidiary of any Borrower to
amend, a Benefit Plan resulting in an increase in current liability for the plan
year such that any Borrower, any Subsidiary of any Borrower or any ERISA
Affiliate is required to provide security to such Plan under Section 401(a)(29)
of the IRC; or
(h) withdraw, or permit any Subsidiary of any Borrower to
withdraw, from any Multiemployer Plan where such withdrawal is reasonably likely
to result in any liability of any such entity under Title IV of ERISA;
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that, individually or in the aggregate, results in or reasonably would be
expected to result in a claim against or liability of any Borrower, any
Subsidiary of any Borrower or any ERISA Affiliate in excess of $25,000.
7.22 SALES AND LEASEBACKS. Except for Permitted Dispositions, enter
into any arrangement, directly or indirectly, with any third party whereby any
Loan Party shall sell or transfer any property, real or personal, whether now
owned or hereafter acquired, and whereby such Loan Party shall then or
thereafter rent or lease as lessee of such property or any part thereof or other
property that such Loan Party intends to use for substantially the same purpose
or purposes as the property sold or transferred.
7.23 ANTI-TERRORISM LAWS. (a) Conduct any business or engage in any
transaction or dealing with any Blocked Person, including the making or
receiving any contribution of funds, goods or services to or for the benefit of
any Blocked Person; (b) deal in, or otherwise engage in any transaction relating
to, any property or interests in property blocked pursuant to Executive Order
No. 13224; or (c) engage in on conspire to engage in any transaction that evades
or avoids, or has the purpose of evading or avoiding, or attempts to violate,
(i) any of the prohibitions set forth in Executive Order No. 13224 or the USA
Patriot Act, or (ii) any prohibitions set forth in the rules or regulations
issued by OFAC or any sanctions against targeted foreign countries, terrorism
sponsoring organizations, and international narcotics traffickers based on U.S.
foreign policy. Borrowers shall deliver to Agent and Lenders any certification
or other evidence requested from time to time by Agent or any Lender, in their
Permitted Discretion, confirming Borrowers' compliance with this Section 7.23.
7.24 SPECULATIVE TRANSACTIONS. Engage in any transaction involving
commodity options or futures contracts or any similar speculative transactions
except for Hedge Agreements that are used solely as part of normal business
operations as a risk management strategy and/or hedge against charges resulting
from market operations in accordance with Parent's customary policies and not as
a means to speculate for investment purposes or trends and shifts in financial
or commodities markets.
8. EVENTS OF DEFAULT.
Any one or more of the following events shall constitute an
event of default (each, an "Event of Default") under this Agreement:
8.1. If Borrowers fail to pay when due and payable, or when
declared due and payable, all or any portion of the Obligations (whether of
principal, interest, fees and charges due the Lender Group, reimbursement of
Lender Group Expenses, or other amounts constituting Obligations); provided,
however that in the case of Overadvances that are caused by the charging of
interest, fees, or Lender Expenses to the Loan Account, such event shall not
constitute an Event of Default if, within 3 Business Days of its receipt of
telephonic notice of such Overadvance, Borrowers eliminate such Overadvance;
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8.2. If any of the Loan Parties:
(a) fails to perform, keep, or observe any term,
provision, covenant, or agreement contained in Sections 2.7, 3.2, 4.2, 4.4, 4.6,
4.8, 6.8, 6.11(b), 6.13, 6.20, and 7.1 through 7.24 of this Agreement;
(b) fails or neglects to perform, keep, or observe any
term, provision, covenant, or agreement contained in Sections 4.5, 6.2, 6.3,
6.6, 6.7, 6.9, 6.10, 6.11(a), 6.14, 6.15 and 6.19 of this Agreement and such
failure continues for a period of 15 Business Days; or
(c) fails or neglects to perform, keep, or observe any
other term, provision, covenant, or agreement contained in this Agreement, or in
any of the other Loan Documents (giving effect to any grace periods, cure
periods, or required notices, if any, expressly provided for in such Loan
Documents); in each case, other than any such term, provision, covenant, or
agreement that is the subject of another provision of this Section 8 (in which
event such other provision of this Section 8 shall govern), and such failure
continues for a period of 15 Business Days;
provided that, during any period of time that any such failure or neglect
referred to in this paragraph exists, even if such failure or neglect is not yet
an Event of Default, Lenders shall be relieved of their obligations to extend
credit hereunder;
8.3. If any material portion of any Loan Party's assets is
attached, seized, subjected to a writ or distress warrant, levied upon, or comes
into the possession of any third Person;
8.4. If any Loan Party is enjoined, restrained, or in any way
prevented by court order from continuing to conduct all or any material part of
its business affairs;
8.5. If a notice of Lien, levy, or assessment, individually or in
the aggregate in an amount of $500,000 or greater, is filed of record with
respect to any Loan Party's assets by the United States or Canada, or any
department, agency, or instrumentality thereof, or by any state, province,
territory, county, municipal, or governmental agency, or if any taxes or debts
owing at any time hereafter to any one or more of such entities becomes a Lien,
whether xxxxxx or otherwise, upon any Borrower's or any of its Subsidiaries'
assets and the same is not paid on the payment date thereof;
8.6. If a judgment or other claim becomes a Lien or encumbrance
upon any material portion of any Loan Party's properties or assets;
8.7. If there is a default in any material agreement to which any
Loan Party is a party including, without limitation, any Material Contract,
Affiliate Contract or any material contract with any of SAC Holding, SSI, PMSR
or PM Preferred (other than the New AMERCO Notes, the Term Loan B Notes and the
Synthetic Leases) or any other Indebtedness in excess of $1,000,000, and such
default (a) occurs at the final maturity of the obligations thereunder, or (b)
results in the acceleration of the maturity of the applicable Loan Party's
obligations thereunder;
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8.8. Except as otherwise set forth in the Reorganization Plan or as
otherwise permitted by this Agreement, if any Loan Party makes any payment on
account of Indebtedness that has been contractually subordinated in right of
payment to the payment of the Obligations;
8.9. If any material misstatement or material misrepresentation
exists now or hereafter in any warranty, representation, statement, or Record
made to the Lender Group by any Borrower, its Subsidiaries, or any officer,
employee, agent, or director of any Borrower or any of its Subsidiaries;
8.10. If the obligation of any Guarantor under its Guaranty is
limited or terminated by operation of law or by such Guarantor thereunder;
8.11. If this Agreement or any other Loan Document that purports to
create a Lien, shall, for any reason, fail or cease to create a valid and
perfected and, except to the extent permitted by the terms hereof or thereof,
first priority Lien on or security interest in the Collateral covered hereby or
thereby;
8.12. If any provision of any Loan Document shall at any time for
any reason be declared to be null and void, or the validity or enforceability
thereof shall be contested by any Loan Party, or a proceeding shall be commenced
by any Loan Party, or by any Governmental Authority having jurisdiction over any
Loan Party, seeking to establish the invalidity or unenforceability thereof, or
any Loan Party shall deny that any Loan Party has any liability or obligation
purported to be created under any Loan Document;
8.13. If suit or action is commenced against Agent or the Lenders
and, as to any suit or action brought by any Person other than Borrowers or
Guarantors or an officer or employee of Borrowers, is continued without
dismissal for 30 days after service thereof on the Lenders, that asserts, by or
on behalf of Borrowers or Guarantors, any claim or legal or equitable remedy
which seeks subordination of the claim or Lien of the Lenders hereunder or under
any other Loan Document;
8.14. If any Loan Party shall file any application in support of, or
shall otherwise fail to contest in good faith, a suit or action of the type set
forth in Section 8.13 filed by any Person other than a Borrower or an officer or
employee of Borrowers;
8.15. If an Insolvency Proceeding is commenced by or against any
Loan Party, or any of its Subsidiaries (other than INW), and any of the
following events occur: (a) the applicable Loan Party or the Subsidiary consents
to the institution of the Insolvency Proceeding against it, (b) the petition
commencing the Insolvency Proceeding is not timely controverted, (c) the
petition commencing the Insolvency Proceeding is not dismissed within 45
calendar days of the date of the filing thereof; provided, however, that, during
the pendency of such period, Lenders shall be relieved of their obligation to
extend credit hereunder, (d) an interim trustee is appointed to take possession
of all or any substantial portion of the properties or assets of, or to operate
all or any substantial portion of the business of, any Loan Party or any of its
Subsidiaries, or (e) an order for relief shall have been entered therein; or
8.16. (a) If any event of default occurs under any New AMERCO Note
Document, any Term Loan B Note Document or any of the Synthetic Leases; (b) if
any Term Loan B Note
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Lender contests the validity or enforceability of the Term Loan B Intercreditor
Agreement or fails to comply with its obligations thereunder; or (c) if any New
AMERCO Note Lender contests that the Obligations hereunder constitute "Senior
Indebtedness" under the New AMERCO Note Documents.
9. THE LENDER GROUP'S RIGHTS AND REMEDIES.
9.1 RIGHTS AND REMEDIES.
(a) Upon the occurrence, and during the continuation, of
an Event of Default, the Required Lenders (at their election but without notice
of their election and without demand) may authorize and instruct Agent to do any
one or more of the following on behalf of the Lender Group (and Agent, acting
upon the instructions of the Required Lenders, shall do the same on behalf of
the Lender Group), all of which are authorized by Borrowers:
(i) Declare all Obligations (other than Bank
Product Obligations), whether evidenced by this Agreement, by
any of the other Loan Documents, or otherwise, immediately due
and payable;
(ii) Cease advancing money or extending credit to
or for the benefit of Borrowers under this Agreement, under
any of the Loan Documents, or under any other agreement
between Borrowers and the Lender Group;
(iii) Terminate this Agreement and any of the
other Loan Documents as to any future liability or obligation
of the Lender Group, but without affecting any of the Agent's
Liens in the Collateral and without affecting the Obligations;
(iv) Settle or adjust disputes and claims
directly with Account Debtors of Borrowers for amounts and
upon terms which Agent considers advisable, and in such cases,
Agent will credit the Loan Account with only the net amounts
received by Agent in payment of such disputed Accounts after
deducting all Lender Group Expenses incurred or expended in
connection therewith;
(v) Cause Borrowers to hold all of their
returned Inventory in trust for the Lender Group, segregate
all returned Inventory from all other assets of Borrowers or
in Borrowers' possession and conspicuously label said returned
Inventory as the property of the Lender Group;
(vi) Without notice to or demand upon any
Borrower or any Guarantor, make such payments and do such acts
as Agent considers necessary or reasonable to protect its
security interests in the Collateral. Each Borrower agrees to
assemble the Personal Property Collateral if Agent so
requires, and to make the Personal Property Collateral
available to Agent at a place that Agent may designate which
is reasonably convenient to both parties. Each Borrower
authorizes Agent to enter the premises where the Personal
Property Collateral is located, to take and maintain
possession of the Personal Property Collateral, or any part of
it, and to pay, purchase, contest, or compromise any Lien that
in Agent's determination appears to conflict with the Agent's
Liens and to pay all
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expenses incurred in connection therewith and to charge
Borrowers' Loan Account therefor. With respect to any of
Borrowers' owned or leased premises, each Borrower hereby
grants Agent a license to enter into possession of such
premises and to occupy the same, without charge, in order to
exercise any of the Lender Group's rights or remedies provided
herein, at law, in equity, or otherwise;
(vii) Without notice to any Borrower (such notice
being expressly waived), and without constituting an
acceptance of any collateral in full or partial satisfaction
of an obligation (within the meaning of the Code), set off and
apply to the Obligations any and all (i) balances and deposits
of any Borrower held by the Lender Group (including any
amounts received in the Cash Management Accounts), or (ii)
Indebtedness at any time owing to or for the credit or the
account of any Borrower held by the Lender Group;
(viii) Hold, as cash collateral, any and all
balances and deposits of any Borrower held by the Lender
Group, and any amounts received in the Cash Management
Accounts, to secure the full and final repayment of all of the
Obligations;
(ix) Ship, reclaim, recover, store, finish,
maintain, repair, prepare for sale, advertise for sale, and
sell (in the manner provided for herein) the Personal Property
Collateral. Each Borrower hereby grants to Agent, for the
benefit of the Lender Group and the Bank Product Providers, a
license or other right to use, without charge, such Borrower's
labels, patents, copyrights, trade secrets, trade names,
trademarks, service marks, and advertising matter, or any
property of a similar nature, as it pertains to the Personal
Property Collateral, in completing production of, advertising
for sale, and selling any Personal Property Collateral and
such Borrower's rights under all licenses and all franchise
agreements shall inure to the Lender Group's benefit;
(x) Sell the Personal Property Collateral at
either a public or private sale, or both, by way of one or
more contracts or transactions, for cash or on terms, in such
manner and at such places (including Borrowers' premises) as
Agent determines is commercially reasonable. It is not
necessary that the Personal Property Collateral be present at
any such sale;
(xi) Agent shall give notice of the disposition
of the Personal Property Collateral as follows:
(A) Agent shall give Administrative
Borrower (for the benefit of the applicable Borrower)
a notice in writing of the time and place of public
sale, or, if the sale is a private sale or some other
disposition other than a public sale is to be made of
the Personal Property Collateral, the time on or
after which the private sale or other disposition is
to be made;
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(B) The notice shall be personally
delivered or mailed, postage prepaid, to
Administrative Borrower as provided in Section 12, at
least 10 days before the earliest time of disposition
set forth in the notice; no notice needs to be given
prior to the disposition of any portion of the
Personal Property Collateral that is perishable or
threatens to decline speedily in value or that is of
a type customarily sold on a recognized market;
(C) Each Borrower hereby acknowledges
and agrees that such notice, when given, shall
constitute a reasonable "authenticated notification
of disposition" within the meaning of Section 9-611
of the Uniform Commercial Code, as in effect from
time to time in any applicable jurisdiction;
(xii) Credit bid and purchase at any public sale;
(xiii) Seek the appointment of a receiver or keeper
to take possession of all or any portion of the Collateral or
to operate same and, to the maximum extent permitted by law,
may seek the appointment of such a receiver without the
requirement of prior notice or a hearing; and
(xiv) Cause any Loan Party to exercise any
purchase right with respect to a Vehicle that such Loan Party
may have at the termination of any TRAC Lease Transaction if
Agent determines, in its Permitted Discretion, that such Loan
Party has equity in such Vehicle.
(b) Any deficiency that exists after disposition of the
Personal Property Collateral as provided in Section 9.1(a) will be paid
immediately by Borrowers. Any excess will be returned, without interest and
subject to the rights of third Persons, by Agent to Administrative Borrower (for
the benefit of the applicable Borrower).
(c) Borrowers agree for themselves and on behalf of each
of their Subsidiaries that it would not be commercially unreasonable for Agent
to dispose of the Collateral or any portion thereof by using Internet sites that
provide for the auction of assets of the types included in such Collateral or
that have the reasonable capability of doing so, or that match buyers and
sellers.
9.2 REMEDIES CUMULATIVE. The rights and remedies of the Lender
Group under this Agreement, the other Loan Documents, and all other agreements
shall be cumulative. The Lender Group shall have all other rights and remedies
not inconsistent herewith as provided under any other Loan Document, the Code,
by law, or in equity. No exercise by the Lender Group of one right or remedy
shall be deemed an election, and no waiver by the Lender Group of any Event of
Default shall be deemed a continuing waiver. No delay by the Lender Group shall
constitute a waiver, election, or acquiescence by it.
10. TAXES AND EXPENSES.
If any Borrower fails to pay any monies (whether taxes,
assessments, insurance premiums, or, in the case of leased properties or assets,
rents or other amounts payable under
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such leases) due to third Persons, or fails to make any deposits or furnish any
required proof of payment or deposit, all as required under the terms of this
Agreement, then, Agent, in its sole discretion and without prior notice to any
Borrower, may do any or all of the following, provided that, to the extent
practicable, Agent shall give Administrative Borrower 10 days' prior notice
before exercise: (a) make payment of the same or any part thereof, (b) set up
such reserves in Borrowers' Loan Account as Agent deems necessary to protect the
Lender Group from the exposure created by such failure, or (c) in the case of
the failure to comply with Section 6.8 hereof, obtain and maintain insurance
policies of the type described in Section 6.8 and take any action with respect
to such policies as Agent deems prudent. Any such amounts paid by Agent shall
constitute Lender Group Expenses and any such payments shall not constitute an
agreement by the Lender Group to make similar payments in the future or a waiver
by the Lender Group of any Event of Default under this Agreement. Agent need not
inquire as to, or contest the validity of, any such expense, tax, or Lien and
the receipt of the usual official notice for the payment thereof shall be
conclusive evidence that the same was validly due and owing.
11. WAIVERS; INDEMNIFICATION.
11.1 DEMAND; PROTEST; ETC. Each Borrower waives demand, protest,
notice of protest, notice of default or dishonor, notice of payment and
nonpayment, nonpayment at maturity, release, compromise, settlement, extension,
or renewal of documents, instruments, Chattel Paper, and guarantees at any time
held by the Lender Group on which any such Borrower may in any way be liable.
11.2 THE LENDER GROUP'S LIABILITY FOR COLLATERAL. Each Borrower
hereby agrees that: (a) so long as the Lender Group complies with its
obligations, if any, under the Code, Agent shall not in any way or manner be
liable or responsible for: (i) the safekeeping of the Collateral, (ii) any loss
or damage thereto occurring or arising in any manner or fashion from any cause,
(iii) any diminution in the value thereof, or (iv) any act or default of any
carrier, warehouseman, bailee, forwarding agency, or other Person, and (b) all
risk of loss, damage, or destruction of the Collateral shall be borne by
Borrowers.
11.3 INDEMNIFICATION. Each Borrower shall pay, indemnify, defend,
and hold the Agent-Related Persons, the Lender Related Persons with respect to
each Lender, each Participant, and each of their respective officers, directors,
employees, agents, and attorneys-in-fact (each, an "Indemnified Person")
harmless (to the fullest extent permitted by law) from and against any and all
claims, demands, suits, actions, investigations, proceedings, and damages, and
all reasonable attorneys fees and disbursements and other costs and expenses
actually incurred in connection therewith (as and when they are incurred and
irrespective of whether suit is brought), at any time asserted against, imposed
upon, or incurred by any of them (a) in connection with or as a result of or
related to the execution, delivery, enforcement, performance, or administration
(including any restructuring or workout with respect hereto) of this Agreement,
any of the other Loan Documents, or the transactions contemplated hereby or
thereby or the monitoring of Borrowers' and their Subsidiaries' compliance with
the terms of the Loan Documents, and (b) with respect to any investigation,
litigation, or proceeding related to this Agreement, any other Loan Document, or
the use of the proceeds of the credit provided hereunder (irrespective of
whether any Indemnified Person is a party thereto), or any act, omission, event,
or circumstance in any manner related thereto (all the foregoing, collectively,
106
the "Indemnified Liabilities"). The foregoing to the contrary notwithstanding,
Borrowers shall have no obligation to any Indemnified Person under this Section
11.3 with respect to any Indemnified Liability that a court of competent
jurisdiction finally determines to have resulted from the gross negligence or
willful misconduct of such Indemnified Person. This provision shall survive the
termination of this Agreement and the repayment of the Obligations. If any
Indemnified Person makes any payment to any other Indemnified Person with
respect to an Indemnified Liability as to which Borrowers were required to
indemnify the Indemnified Person receiving such payment, the Indemnified Person
making such payment is entitled to be indemnified and reimbursed by Borrowers
with respect thereto. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO
EACH INDEMNIFIED PERSON WITH RESPECT TO INDEMNIFIED LIABILITIES WHICH IN WHOLE
OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF SUCH
INDEMNIFIED PERSON OR OF ANY OTHER PERSON.
12. NOTICES.
Unless otherwise provided in this Agreement, all notices or
demands by Borrowers or Agent to the other relating to this Agreement or any
other Loan Document shall be in writing and (except for financial statements and
other informational documents which may be sent by first-class mail, postage
prepaid) shall be personally delivered or sent by registered or certified mail
(postage prepaid, return receipt requested), overnight courier, electronic mail
(at such email addresses as Administrative Borrower or Agent, as applicable, may
designate to each other in accordance herewith), or telefacsimile to Borrowers
in care of Administrative Borrower or to Agent, as the case may be, at its
address set forth below:
If to Administrative Borrower: AMERCO
0000 Xxxxxxxxx Xxx, Xxxxx 000
Xxxx, Xxxxxx 00000-0000
Attn: Assistant Treasurer
Fax No. 000.000.0000
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with copies to: U-HAUL INTERNATIONAL, INC.
0000 Xxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx 00000
Attn: General Counsel
Fax No. 000.000.0000
with copies to: SQUIRE, XXXXXXX & XXXXXXX,
L.L.P.
Two Renaissance Square
00 Xxxxx Xxxxxxx Xxxxxx,
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxxxxxx X. Xxxxxxx,
Esq.
Fax No. 000.000.0000
If to Agent: XXXXX FARGO FOOTHILL, INC.
0000 Xxxxxxxx Xxxxxx
Xxxxx 0000X
Xxxxx Xxxxxx, Xxxxxxxxxx
00000
Attn: Specialty Finance
Division Manager
Fax No. 000.000.0000
with copies to: PAUL, HASTINGS, XXXXXXXX &
XXXXXX LLP
000 Xxxxxxxxx Xxxxxx, XX,
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000-0000
Attn: Xxxxx X. Xxxxx, Esq.
Xxxxx X.X. Xxxxx, Esq.
Fax No. 000.000.0000
Agent and Borrowers may change the address at which they are
to receive notices hereunder, by notice in writing in the foregoing manner given
to the other party. All notices or demands sent in accordance with this Section
12, other than notices by Agent in connection with enforcement rights against
the Collateral under the provisions of the Code, shall be deemed received on the
earlier of the date of actual receipt or 3 Business Days after the deposit
thereof in the mail. Each Borrower acknowledges and agrees that notices sent by
the Lender Group in connection with the exercise of enforcement rights against
Collateral under the provisions of the Code shall be deemed sent when deposited
in the mail or personally delivered, or, where permitted by law, transmitted by
telefacsimile or any other method set forth above. Each member of the Lender
Group hereby acknowledges and agrees that (i) Agent may provide any notice to be
delivered to the Lender Group pursuant to this Agreement and the other Loan
Documents by posting such notice on IntraLinks or by sending such notice via
electronic mail (at such electronic mail address as such member of the Lender
Group may designate), and (ii) such posting or sending via electronic mail to
the Lender Group shall constitute delivery of such item to the Lender Group.
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13. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.
(a) THE VALIDITY OF THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER LOAN DOCUMENT IN
RESPECT OF SUCH OTHER LOAN DOCUMENT), THE CONSTRUCTION, INTERPRETATION, AND
ENFORCEMENT HEREOF AND THEREOF, AND THE RIGHTS OF THE PARTIES HERETO AND THERETO
WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR
THERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, EXCEPT AS GOVERNED BY THE BANKRUPTCY CODE.
(b) THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS
ARISING IN CONNECTION WITH THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE
TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY
OF NEW YORK, STATE OF NEW YORK, EXCEPT TO THE EXTENT THE BANKRUPTCY COURT
RETAINS JURISDICTION WITH RESPECT TO THE REORGANIZATION PLAN; PROVIDED, HOWEVER,
THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY
BE BROUGHT, AT AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE AGENT
ELECTS TO BRING SUCH ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE
FOUND. BORROWERS AND THE LENDER GROUP WAIVE, TO THE EXTENT PERMITTED UNDER
APPLICABLE LAWS, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON
CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN
ACCORDANCE WITH THIS SECTION 13(b).
(c) BORROWERS AND THE LENDER GROUP HEREBY WAIVE THEIR
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED
THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL
OTHER COMMON LAW OR STATUTORY CLAIMS. BORROWERS AND THE LENDER GROUP REPRESENT
THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS
JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF
LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A
TRIAL BY THE COURT.
14. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS.
14.1 ASSIGNMENTS AND PARTICIPATIONS.
(a) Any Lender may, with the written consent of Agent
(provided that no written consent of Agent shall be required in connection with
any assignment and delegation by a Lender to an Eligible Transferee), assign and
delegate to one or more assignees (each an "Assignee") all, or any ratable part
of all, of the Obligations (other than Bank Product
109
Obligations), the Commitments and the other rights and obligations of such
Lender hereunder and under the other Loan Documents, in a minimum amount of
$5,000,000 (except that such minimum amount shall not apply to an Affiliate of a
Lender or to a Related Fund or to an assignment of all of such Lender's rights
and obligations); provided, however, that Borrowers and Agent may continue to
deal solely and directly with such Lender in connection with the interest so
assigned to an Assignee until (i) written notice of such assignment, together
with payment instructions, addresses, and related information with respect to
the Assignee, have been given to Administrative Borrower and Agent by such
Lender and the Assignee, (ii) such Lender and its Assignee have delivered to
Administrative Borrower and Agent an Assignment and Acceptance in form and
substance reasonably satisfactory to Agent, and (iii) the assignor Lender or
Assignee has paid to Agent for Agent's separate account a processing fee in the
amount of $5,000. Anything contained herein to the contrary notwithstanding, the
consent of Agent shall not be required (and payment of any fees shall not be
required) if (x) such assignment is in connection with any merger,
consolidation, sale, transfer, or other disposition of all or any substantial
portion of the business or loan portfolio of such Lender or (y) the assignee is
an Affiliate (other than individual(s)) of a Lender or a Related Fund.
Furthermore, for the avoidance of doubt, any assignment or delegation of any
Bank Product Agreement may be effected by the parties thereto without the
consent of the Lender Group.
(b) Subject to recordation in accordance with Section
14.1(h) below, from and after the date that Agent notifies the assignor Lender
(with a copy to Administrative Borrower) that it has received an executed
Assignment and Acceptance and payment of the above-referenced processing fee, as
applicable, (i) the Assignee thereunder shall be a party hereto and, to the
extent that rights and obligations hereunder have been assigned to it pursuant
to such Assignment and Acceptance, shall have the rights and obligations of a
Lender under the Loan Documents, and (ii) the assignor Lender shall, to the
extent that rights and obligations hereunder and under the other Loan Documents
have been assigned by it pursuant to such Assignment and Acceptance, relinquish
its rights (except with respect to Section 11.3 hereof) and be released from its
obligations under this Agreement (and in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's rights
and obligations under this Agreement and the other Loan Documents, such Lender
shall cease to be a party hereto and thereto), and such assignment shall effect
a novation between Borrowers and the Assignee; provided, however, that nothing
contained herein shall release any assigning Lender from obligations that
survive the termination of this Agreement, including such assigning Lender's
obligations under Section 16 and Section 17.8 of this Agreement.
(c) By executing and delivering an Assignment and
Acceptance, the assigning Lender thereunder and the Assignee thereunder confirm
to and agree with each other and the other parties hereto as follows: (i) other
than as provided in such Assignment and Acceptance, such assigning Lender makes
no representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other Loan Document furnished
pursuant hereto, (ii) such assigning Lender makes no representation or warranty
and assumes no responsibility with respect to the financial condition of
Borrowers or the performance or observance by Borrowers of any of their
obligations under this Agreement or any other Loan Document furnished pursuant
hereto, (iii) such Assignee confirms that it has received a copy of this
Agreement, together with such other
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documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance, (iv) such
Assignee will, independently and without reliance upon Agent, such assigning
Lender or any other Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement, (v) such Assignee appoints and
authorizes Agent to take such actions and to exercise such powers under this
Agreement as are delegated to Agent, by the terms hereof, together with such
powers as are reasonably incidental thereto, and (vi) such Assignee agrees that
it will perform all of the obligations which by the terms of this Agreement are
required to be performed by it as a Lender.
(d) Immediately upon each Assignee's making its
processing fee payment under the Assignment and Acceptance and receipt and
acknowledgment by Agent of such fully executed Assignment and Acceptance, this
Agreement shall be deemed to be amended to the extent, but only to the extent,
necessary to reflect the addition of the Assignee and the resulting adjustment
of the Commitments arising therefrom. The Commitment allocated to each Assignee
shall reduce such Commitments of the assigning Lender pro tanto.
(e) Any Lender may at any time sell to one or more
commercial banks, financial institutions, or other Persons not Affiliates of
such Lender (a "Participant") participating interests in its Obligations, the
Commitment, and the other rights and interests of that Lender (the "Originating
Lender") hereunder and under the other Loan Documents; provided, however, that
(i) the Originating Lender shall remain a "Lender" for all purposes of this
Agreement and the other Loan Documents and the Participant receiving the
participating interest in the Obligations, the Commitments, and the other rights
and interests of the Originating Lender hereunder shall not constitute a
"Lender" hereunder or under the other Loan Documents and the Originating
Lender's obligations under this Agreement shall remain unchanged, (ii) the
Originating Lender shall remain solely responsible for the performance of such
obligations, (iii) Borrowers, Agent, and the Lenders shall continue to deal
solely and directly with the Originating Lender in connection with the
Originating Lender's rights and obligations under this Agreement and the other
Loan Documents, (iv) no Lender shall transfer or grant any participating
interest under which the Participant has the right to approve any amendment to,
or any consent or waiver with respect to, this Agreement or any other Loan
Document, except to the extent such amendment to, or consent or waiver with
respect to this Agreement or of any other Loan Document would (1) extend the
final maturity date of the Obligations hereunder in which such Participant is
participating, (2) reduce the interest rate applicable to the Obligations
hereunder in which such Participant is participating, (3) release all or
substantially all of the Collateral or guaranties (except to the extent
expressly provided herein or in any of the Loan Documents) supporting the
Obligations hereunder in which such Participant is participating, (4) postpone
the payment of, or reduce the amount of, the interest or fees payable to such
Participant through such Lender, or (5) change the amount or due dates of
scheduled principal repayments or prepayments or premiums, and (v) all amounts
payable by Borrowers hereunder shall be determined as if such Lender had not
sold such participation; except that, if amounts outstanding under this
Agreement are due and unpaid, or shall have been declared or shall have become
due and payable upon the occurrence of an Event of Default, each Participant
shall be deemed to have the right of set-off in respect of its participating
interest in amounts owing under this Agreement to the same extent as if the
amount of its participating interest were owing directly to it as a Lender under
this Agreement. The rights of any Participant shall only be derivative
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through the Originating Lender with whom such Participant participates and no
Participant shall have any rights under this Agreement or the other Loan
Documents or any direct rights as to the other Lenders, Agent, Borrowers, the
Collections, the Collateral, or otherwise in respect of the Obligations. No
Participant shall have the right to participate directly in the making of
decisions by the Lenders among themselves.
(f) Pursuant to Section 17.10, if any proposed assignee
or participant has agreed in writing to receive any documents or information
subject to the confidentiality provisions contained in this Agreement, in
connection with any such assignment or participation or proposed assignment or
participation, a Lender may disclose all documents and information which it now
or hereafter may have relating to Borrowers or Borrowers' business.
(g) Any other provision in this Agreement
notwithstanding, any Lender (i) may at any time create a security interest in,
or pledge, all or any portion of its rights under and interest in this Agreement
in favor of any Federal Reserve Bank in accordance with Regulation A of the
Federal Reserve Bank or United States Treasury Regulation 31 C.F.R. SECTION
203.14, and such Federal Reserve Bank may enforce such pledge or security
interest in any manner permitted under Applicable Laws, and (ii) that is a Fund
may at any time create a security interest in, or pledge, all or any portion of
its rights under and interest in this Agreement to its trustee to support its
obligations to its trustee, on behalf of the holders of such obligations.
(h) Subject to the last sentence of this Section 14.1(h),
Agent shall maintain, or cause to be maintained, a register (the "Register") on
which it enters the name of a Lender as the registered owner of each Advance, as
the case may be, held by such Lender. A Registered Loan (and the Registered
Note, if any, evidencing the same) may be assigned or sold in whole or in part
only by registration of such assignment or sale on the Register (and each
Registered Note shall expressly so provide). Subject to the last sentence of
this Section 14.1(h), any assignment or sale of all or part of such Registered
Loan (and the Registered Note, if any, evidencing the same) may be effected only
by registration of such assignment or sale on the Register, together with the
surrender of the Registered Note, if any, evidencing the same duly endorsed by
(or accompanied by a written instrument of assignment or sale duly executed by)
the holder of such Registered Note, whereupon, at the request of the designated
assignee(s) or transferee(s), one or more new Registered Notes in the same
aggregate principal amount shall be issued to the designated assignee(s) or
transferee(s). Prior to the registration of an assignment or sale of any
Registered Loan (and the Registered Note, if any, evidencing the same),
Borrowers, Agent and the Lenders shall treat the Person in whose name such
Registered Loan (and the Registered Note, if any, evidencing the same) is
registered as the owner thereof for the purpose of receiving all payments
thereon and for all other purposes, notwithstanding notice to the contrary. In
the case of an assignment or delegation covered by Section 14.1(a)(y), the
assigning Lender shall maintain a register comparable to the Register on behalf
of Agent.
(i) In the event that a Lender sells participations in a
Registered Loan, such Lender shall maintain a register on which it enters the
name of all participants in the Registered Loans held by it (the "Participant
Register"). A Registered Loan (and the Registered Note, if any, evidencing the
same) may be participated in whole or in part only by registration of such
participation on the Participant Register (and each Registered Note shall
expressly so provide).
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Any participation of such Registered Loan (and the Registered Note, if any,
evidencing the same) may be effected only by the registration of such
participation on the Participant Register.
(j) Notwithstanding any other provision hereof, the
Lenders hereby consent to any Lender's pledge (a "Pledge") of its interest in
the Obligations, the Commitment, and the other rights and interests of that
Lender (a "Loan Pledgor") to any Eligible Transferee that has extended a credit
facility to such Loan Pledgor (a "Loan Pledgee"), on the terms and conditions
set forth in this paragraph. Upon written notice by any Loan Pledgor to Agent
that the Pledge has been effected, Agent agrees to acknowledge receipt of such
notice and thereafter agrees: (a) to use its best efforts to give Loan Pledgee
written notice of any default by Loan Pledgor under this Agreement and any
amendment, modification, waiver or termination of Loan Pledgor's rights under
this Agreement; provided, however, Agent shall not have any liability to Loan
Pledgee if Agent fails to give such notice; (b) that Agent shall deliver, at the
expense of Loan Pledgor, to Loan Pledgee such information available to the
Lenders hereunder as Loan Pledgee shall reasonably request; and (c) that, upon
written notice (a "Redirection Notice") to Agent by Loan Pledgee that Loan
Pledgor is in default, beyond applicable cure periods, under Loan Pledgor's
obligations to Loan Pledgee pursuant to the applicable credit agreement between
Loan Pledgor and Loan Pledgee (which notice need not be joined in or confirmed
by all Lenders), and until such Redirection Notice is withdrawn or rescinded by
Loan Pledgee, any payments to which Loan Pledgor is entitled from time to time
pursuant to this Agreement, or any other Loan Document, shall be paid or
directed to Loan Pledgee. The relevant Loan Pledgor hereby unconditionally and
absolutely releases Agent and the other Lenders from any liability to the such
Loan Pledgor on account of Agent's or any Lender's compliance with any
Redirection Notice reasonably believed by Agent or the Lenders to have been
delivered in good faith. Loan Pledgee shall be permitted fully to exercise its
rights and remedies against the relevant Loan Pledgor, and realize on any and
all collateral granted by such Loan Pledgor to Loan Pledgee (and accept an
assignment in lieu of foreclosure as to such collateral), in accordance with
Applicable Laws and the provisions of this Agreement. In such event, Agent and
the Lenders shall recognize Loan Pledgee, and its successors and assigns that
are Eligible Transferees, as the successor to the applicable Loan Pledgor's
rights, remedies and obligations under this Agreement and the Loan Documents.
The rights of Loan Pledgee under this paragraph shall remain effective unless
and until such Loan Pledgee shall have notified Agent in writing that its
interest in the Obligations, the Commitment, and the other rights and interests
of the relevant Loan Pledgor has terminated.
14.2 SUCCESSORS. This Agreement shall bind and inure to the benefit
of the respective successors and assigns of each of the parties hereto
including, with respect to each Borrower, the estate of such Borrower, any
trustee or successor-in-interest in an Insolvency Proceeding; provided, however,
that Borrowers may not assign this Agreement or any rights or duties hereunder
without the Lenders' prior written consent and any prohibited assignment shall
be absolutely void ab initio. No consent to assignment by the Lenders shall
release any Borrower from its Obligations. A Lender may assign this Agreement
and the other Loan Documents and its rights and duties hereunder and thereunder
pursuant to Section 14.1 hereof and, except as expressly required pursuant to
Section 14.1 hereof, no consent or approval by any Borrower is required in
connection with any such assignment.
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15. AMENDMENTS; WAIVERS.
15.1 AMENDMENTS AND WAIVERS. No amendment or waiver of any
provision of this Agreement or any other Loan Document, and no consent with
respect to any departure by Borrowers therefrom, shall be effective unless the
same shall be in writing and signed by the Required Lenders (or by Agent at the
written request of the Required Lenders) and Administrative Borrower (on behalf
of all Borrowers) and then any such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given; provided,
however, that no such waiver, amendment, or consent shall, unless in writing and
signed by all of the Lenders affected thereby and Administrative Borrower (on
behalf of all Borrowers) and acknowledged by Agent, do any of the following:
(a) increase or extend any Commitment of any Lender,
(b) postpone or delay any date fixed by this Agreement or
any other Loan Document for any payment of principal, interest, fees, or other
amounts due hereunder or under any other Loan Document,
(c) reduce the principal of, or the rate of interest on,
any loan or other extension of credit hereunder, or reduce any fees or other
amounts payable hereunder or under any other Loan Document,
(d) change the percentage of the Commitments that is
required to take any action hereunder, (e) amend, modify or waive this Section
or any provision of the Agreement providing for consent or other action by all
Lenders,
(f) release Collateral other than as permitted by Section
16.12,
(g) change the definition of "Required Lenders" or "Pro
Rata Share",
(h) contractually subordinate any of the Agent's Liens,
(i) release any Borrower or any material Guarantor from
any obligation for the payment of money,
(j) change the definitions of Availability, Bank Product
Reserves, Borrowing Base, Fair Market Valuation, Maximum Revolver Amount, or
Term Loan Amount or amend, modify or waive any of the provisions of Section
2.1(a), Section 2.1(b), Section 2.2, Section 2.3(e), Section 2.3(i), Section
2.4(b) or Section 2.5, or
(k) amend, modify or waive any of the provisions of
Section 16.
and, provided further, however, that no amendment, waiver or consent shall,
unless in writing and signed by Agent, Issuing Lender, or Swing Lender, affect
the rights or duties of Agent, Issuing Lender, or Swing Lender, as applicable,
under this Agreement or any other Loan Document. The foregoing notwithstanding,
any amendment, modification, waiver, consent,
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termination, or release of, or with respect to, any provision of this Agreement
or any other Loan Document that relates only to the relationship of the Lender
Group among themselves, and that does not affect the rights or obligations of
Borrowers, shall not require consent by or the agreement of Borrowers.
Furthermore, for the avoidance of doubt, any amendment, modification, waiver,
consent, termination, or release of, or with respect to, any provision of any
Bank Product Agreement may be effected by the parties thereto without the
consent of the Lender Group.
15.2 REPLACEMENT OF HOLDOUT LENDER. If any action to be taken by
the Lender Group or Agent hereunder requires the unanimous consent,
authorization, or agreement of all Lenders, and a Lender ("Holdout Lender")
fails to give its consent, authorization, or agreement, then Agent, upon at
least 5 Business Days prior irrevocable notice to the Holdout Lender, may
permanently replace the Holdout Lender with one or more substitute Lenders
(each, a "Replacement Lender"), and the Holdout Lender shall have no right to
refuse to be replaced hereunder. Such notice to replace the Holdout Lender shall
specify an effective date for such replacement, which date shall not be later
than 15 Business Days after the date such notice is given.
Prior to the effective date of such replacement, the Holdout
Lender and each Replacement Lender shall execute and deliver an Assignment and
Acceptance Agreement, subject only to the Holdout Lender's being repaid its
share of the outstanding Obligations (including an assumption of its Pro Rata
Share of the Risk Participation Liability) without any premium or penalty of any
kind whatsoever. If the Holdout Lender shall refuse or fail to execute and
deliver any such Assignment and Acceptance Agreement prior to the effective date
of such replacement, the Holdout Lender shall be deemed to have executed and
delivered such Assignment and Acceptance Agreement. The replacement of any
Holdout Lender shall be made in accordance with the terms of Section 14.1. Until
such time as the Replacement Lenders shall have acquired all of the Obligations,
the Commitments, and the other rights and obligations of the Holdout Lender
hereunder and under the other Loan Documents, the Holdout Lender shall remain
obligated to make the Holdout Lender's Pro Rata Share of Advances and to
purchase a participation in each Letter of Credit, in an amount equal to its Pro
Rata Share of the Risk Participation Liability of such Letter of Credit.
15.3 NO WAIVERS; CUMULATIVE REMEDIES. No failure by Agent or any
Lender to exercise any right, remedy, or option under this Agreement or any
other Loan Document, or delay by Agent or any Lender in exercising the same,
will operate as a waiver thereof. No waiver by Agent or any Lender will be
effective unless it is in writing, and then only to the extent specifically
stated. No waiver by Agent or any Lender on any occasion shall affect or
diminish Agent's and each Lender's rights thereafter to require strict
performance by Borrowers of any provision of this Agreement. Agent's and each
Lender's rights under this Agreement and the other Loan Documents will be
cumulative and not exclusive of any other right or remedy that Agent or any
Lender may have.
15.4 WP XXXXX TRANSACTION. Each Loan Party, each Lender and Agent
hereby stipulate and agree that in the event the Required Lenders approve the
terms and conditions of any transaction constituting the WP Xxxxx Transaction,
any special purpose entity formed by a Loan Party after the Closing Date solely
for the purpose of consummating such WP Xxxxx
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Transaction, as approved, shall not be subject to the representations,
warranties and covenants in this Agreement and the other Loan Documents.
16. AGENT; THE LENDER GROUP.
16.1 APPOINTMENT AND AUTHORIZATION OF AGENT. Each Lender hereby
designates and appoints Foothill as its representative under this Agreement and
the other Loan Documents (other than the Bank Product Agreements) and each
Lender hereby irrevocably authorizes Agent to execute and deliver each of the
other Loan Documents (other than the Bank Product Agreements) on its behalf and
to take such other action on its behalf under the provisions of this Agreement
and each other Loan Document (other than the Bank Product Agreements) and to
exercise such powers and perform such duties as are expressly delegated to Agent
by the terms of this Agreement or any other Loan Document, together with such
powers as are reasonably incidental thereto. Agent agrees to act as such on the
express conditions contained in this Section 16. The provisions of this Section
16 are solely for the benefit of Agent, and the Lenders, and Borrowers shall
have no rights as a third party beneficiary of any of the provisions contained
herein. Any provision to the contrary contained elsewhere in this Agreement or
in any other Loan Document notwithstanding, Agent shall not have any duties or
responsibilities, except those expressly set forth herein, nor shall Agent have
or be deemed to have any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or any other Loan Document or otherwise exist
against Agent; it being expressly understood and agreed that the use of the word
"Agent" is for convenience only, that Foothill is merely the representative of
the Lenders, and only has the contractual duties set forth herein. Except as
expressly otherwise provided in this Agreement, Agent shall have and may use its
sole discretion with respect to exercising or refraining from exercising any
discretionary rights or taking or refraining from taking any actions that Agent
expressly is entitled to take or assert under or pursuant to this Agreement and
the other Loan Documents. Without limiting the generality of the foregoing, or
of any other provision of the Loan Documents that provides rights or powers to
Agent, Lenders agree that Agent shall have the right to exercise the following
powers as long as this Agreement remains in effect: (a) maintain, in accordance
with its customary business practices, ledgers and records reflecting the status
of the Obligations, the Collateral, the Collections, and related matters, (b)
execute or file any and all financing or similar statements or notices,
amendments, renewals, supplements, documents, instruments, proofs of claim,
notices and other written agreements with respect to the Loan Documents, (c)
make Advances, for itself or on behalf of Lenders as provided in the Loan
Documents, (d) exclusively receive, apply, and distribute the Collections as
provided in the Loan Documents, (e) open and maintain such bank accounts and
cash management accounts as Agent deems necessary and appropriate in accordance
with the Loan Documents for the foregoing purposes with respect to the
Collateral and the Collections, (f) perform, exercise, and enforce any and all
other rights and remedies of the Lender Group with respect to Borrowers, the
Obligations, the Collateral, the Collections, or otherwise related to any of
same as provided in the Loan Documents, and (g) incur and pay such Lender Group
Expenses as Agent may deem necessary or appropriate for the performance and
fulfillment of its functions and powers pursuant to the Loan Documents.
16.2 DELEGATION OF DUTIES. Agent may execute any of its duties
under this Agreement or any other Loan Document by or through agents, employees
or attorneys-in-fact and shall be
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entitled to advice of counsel concerning all matters pertaining to such duties.
Agent shall not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects as long as such selection was made without
gross negligence or willful misconduct.
16.3 LIABILITY OF AGENT. None of the Agent-Related Persons shall
(i) be liable for any action taken or omitted to be taken by any of them under
or in connection with this Agreement or any other Loan Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct), or (ii) be responsible in any manner to any of the Lenders for any
recital, statement, representation or warranty made by any Borrower or any
Subsidiary or Affiliate of any Borrower, or any officer or director thereof,
contained in this Agreement or in any other Loan Document, or in any
certificate, report, statement or other document referred to or provided for in,
or received by Agent under or in connection with, this Agreement or any other
Loan Document, or the validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Loan Document, or for any failure of
any Borrower or any other party to any Loan Document to perform its obligations
hereunder or thereunder. No Agent-Related Person shall be under any obligation
to any Lender to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, this Agreement or any
other Loan Document, or to inspect the Books or properties of Borrowers or the
books or records or properties of any of Borrowers' Subsidiaries or Affiliates.
16.4 RELIANCE BY AGENT. Agent shall be entitled to rely, and shall
be fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent, or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to Borrowers
or counsel to any Lender), independent accountants and other experts selected by
Agent. Agent shall be fully justified in failing or refusing to take any action
under this Agreement or any other Loan Document unless Agent shall first receive
such advice or concurrence of the Lenders as it deems appropriate and until such
instructions are received, Agent shall act, or refrain from acting, as it deems
advisable. If Agent so requests, it shall first be indemnified to its reasonable
satisfaction by Lenders against any and all liability and expense that may be
incurred by it by reason of taking or continuing to take any such action. Agent
shall in all cases be fully protected in acting, or in refraining from acting,
under this Agreement or any other Loan Document in accordance with a request or
consent of the requisite Lenders and such request and any action taken or
failure to act pursuant thereto shall be binding upon all of the Lenders.
16.5 NOTICE OF DEFAULT OR EVENT OF DEFAULT. Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default, except with respect to defaults in the payment of principal, interest,
fees, and expenses required to be paid to Agent for the account of the Lenders,
except with respect to Defaults and Events of Default of which Agent has actual
knowledge, unless Agent shall have received written notice from a Lender or
Administrative Borrower referring to this Agreement, describing such Default or
Event of Default, and stating that such notice is a "notice of default." Agent
promptly will notify the Lenders of its receipt of any such notice or of any
Event of Default of which Agent has actual knowledge. If any Lender obtains
actual knowledge of any Event of Default, such Lender promptly shall notify the
other Lenders and Agent of such Event of Default. Each Lender shall be solely
responsible for giving any notices to its Participants, if any. Subject to
Section 16.4,
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Agent shall take such action with respect to such Default or Event of Default as
may be requested by the Required Lenders in accordance with Section 9; provided,
however, that unless and until Agent has received any such request, Agent may
(but shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Default or Event of Default as it shall deem
advisable.
16.6 CREDIT DECISION. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by Agent hereinafter taken, including any review of the affairs of Borrowers
and their Subsidiaries or Affiliates, shall be deemed to constitute any
representation or warranty by any Agent-Related Person to any Lender. Each
Lender represents to Agent that it has, independently and without reliance upon
any Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of Borrowers and any other Person party to a Loan Document, and
all applicable bank regulatory laws relating to the transactions contemplated
hereby, and made its own decision to enter into this Agreement and to extend
credit to Borrowers. Each Lender also represents that it will, independently and
without reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigations as
it deems necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of Borrowers and
any other Person party to a Loan Document. Except for notices, reports, and
other documents expressly herein required to be furnished to the Lenders by
Agent, Agent shall not have any duty or responsibility to provide any Lender
with any credit or other information concerning the business, prospects,
operations, property, financial and other condition or creditworthiness of
Borrowers and any other Person party to a Loan Document that may come into the
possession of any of the Agent-Related Persons.
16.7 COSTS AND EXPENSES; INDEMNIFICATION. Agent may incur and pay
Lender Group Expenses to the extent Agent reasonably deems necessary or
appropriate for the performance and fulfillment of its functions, powers, and
obligations pursuant to the Loan Documents, including court costs, reasonable
attorneys' fees and expenses, fees and expenses of financial accountants,
advisors, consultants and appraisers, costs of collection by outside collection
agencies and auctioneer fees and expenses and costs of security guards or
insurance premiums paid to maintain the Collateral, whether or not Borrowers are
obligated to reimburse Agent or Lenders for such expenses pursuant to the Loan
Agreement or otherwise. Agent is authorized and directed to deduct and retain
sufficient amounts from Collections received by Agent to reimburse Agent for
such out-of-pocket costs and expenses prior to the distribution of any amounts
to Lenders. In the event Agent is not reimbursed for such costs and expenses
from Collections received by Agent, each Lender hereby agrees that it is and
shall be obligated to pay to or reimburse Agent for the amount of such Lender's
Pro Rata Share thereof. Whether or not the transactions contemplated hereby are
consummated, the Lenders shall indemnify upon demand the Agent-Related Persons
(to the extent not reimbursed by or on behalf of Borrowers and without limiting
the obligation of Borrowers to do so), according to their Pro Rata Shares, from
and against any and all Indemnified Liabilities; provided, however, that no
Lender shall be liable for the payment to any Agent-Related Person of any
portion of such Indemnified Liabilities
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resulting solely from such Person's gross negligence or willful misconduct nor
shall any Lender be liable for the obligations of any Defaulting Lender in
failing to make an Advance or other extension of credit hereunder. Without
limitation of the foregoing, each Lender shall reimburse Agent upon demand for
such Lender's Pro Rata Share of any costs or out-of-pocket expenses (including
attorneys fees and expenses) incurred by Agent in connection with the
preparation, execution, delivery, administration, modification, amendment, or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement,
any other Loan Document, or any document contemplated by or referred to herein,
to the extent that Agent is not reimbursed for such expenses by or on behalf of
Borrowers. The undertaking in this Section shall survive the payment of all
Obligations hereunder and the resignation or replacement of Agent.
16.8 AGENT IN INDIVIDUAL CAPACITY. The Lenders hereby acknowledge
and agree that Foothill and its Affiliates may make loans to (including, without
limitation, pursuant to the Term Loan B Note Documents), issue letters of credit
for the account of, accept deposits from, acquire equity interests in, and
generally engage in any kind of banking, trust, financial advisory,
underwriting, or other business with Borrowers and their Subsidiaries and
Affiliates and any other Person party to any Loan Documents as though Foothill
were not Agent hereunder, and, in each case, without notice to or consent of the
other members of the Lender Group. The other members of the Lender Group
acknowledge that, pursuant to such activities, Foothill or its Affiliates may
receive information regarding Borrowers or their Affiliates and any other Person
party to any Loan Documents that is subject to confidentiality obligations in
favor of Borrowers or such other Person and that prohibit the disclosure of such
information to the Lenders, and the Lenders acknowledge that, in such
circumstances (and in the absence of a waiver of such confidentiality
obligations, which waiver Agent will use its reasonable best efforts to obtain),
Agent shall not be under any obligation to provide such information to them. The
terms "Lender" and "Lenders" include Foothill in its individual capacity.
16.9 SUCCESSOR AGENT. Agent may resign as Agent upon 45 days'
notice to the Lenders (and at least 15 days notice to Administrative Borrower).
If Agent resigns under this Agreement, the Required Lenders shall appoint a
successor Agent for the Lenders. If no successor Agent is appointed prior to the
effective date of the resignation of Agent, Agent may appoint, after consulting
with the Lenders, a successor Agent. If Agent has materially breached or failed
to perform any material provision of this Agreement or of Applicable Laws, the
Required Lenders may agree in writing to remove and replace Agent with a
successor Agent from among the Lenders. In any such event, upon the acceptance
of its appointment as successor Agent hereunder, such successor Agent shall
succeed to all the rights, powers, and duties of the retiring Agent and the term
"Agent" shall mean such successor Agent and the retiring Agent's appointment,
powers, and duties as Agent shall be terminated. After any retiring Agent's
resignation hereunder as Agent, the provisions of this Section 16 shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
Agent under this Agreement. If no successor Agent has accepted appointment as
Agent by the date which is 45 days following a retiring Agent's notice of
resignation, the retiring Agent's resignation shall nevertheless thereupon
become effective and the Lenders shall perform all of the duties of Agent
hereunder until such time, if any, as the Lenders appoint a successor Agent as
provided for above.
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16.10 LENDER IN INDIVIDUAL CAPACITY. Any Lender and its respective
Affiliates may make loans to, issue letters of credit for the account of, accept
deposits from, acquire equity interests in and generally engage in any kind of
banking, trust, financial advisory, underwriting or other business with
Borrowers and their Subsidiaries and Affiliates and any other Person party to
any Loan Documents as though such Lender were not a Lender hereunder without
notice to or consent of the other members of the Lender Group. The other members
of the Lender Group acknowledge that, pursuant to such activities, such Lender
and its respective Affiliates may receive information regarding Borrowers or
their Affiliates and any other Person (other than the Lender Group) party to any
Loan Documents that is subject to confidentiality obligations in favor of
Borrowers or such other Person and that prohibit the disclosure of such
information to the Lenders, and the Lenders acknowledge that, in such
circumstances (and in the absence of a waiver of such confidentiality
obligations, which waiver such Lender will use its reasonable best efforts to
obtain), such Lender not shall be under any obligation to provide such
information to them. With respect to the Swing Loans and Agent Advances, Swing
Lender shall have the same rights and powers under this Agreement as any other
Lender and may exercise the same as though it were not the sub-agent of the
Agent.
16.11 WITHHOLDING TAXES.
(a) If any Lender is a "foreign person" within the
meaning of the IRC and such Lender claims exemption from, or a reduction of,
United States withholding tax under Sections 1441 or 1442 of the IRC, such
Lender agrees with and in favor of Agent and Borrowers, to deliver to Agent and
Administrative Borrower:
(i) if such Lender claims an exemption from
withholding tax pursuant to its portfolio interest exception,
(1) a statement of the Lender, signed under penalty of
perjury, that it is not a (A) a "bank" as described in Section
881(c)(3)(A) of the IRC, (B) a 10% shareholder of a Borrower
(within the meaning of Section 871(h)(3)(B) of the IRC), or
(C) a controlled foreign corporation related to a Borrower
within the meaning of 864(d)(4) of the IRC, and (2) a properly
completed and executed IRS Form W-8BEN, before the first
payment of any interest under this Agreement and at any other
time reasonably requested by Agent or Administrative Borrower;
(ii) if such Lender claims an exemption from, or
a reduction of, withholding tax under a United States tax
treaty, properly completed and executed IRS Form W-8BEN before
the first payment of any interest under this Agreement and at
any other time reasonably requested by Agent or Administrative
Borrower;
(iii) if such Lender claims that interest paid
under this Agreement is exempt from United States withholding
tax because it is effectively connected with a United States
trade or business of such Lender, two properly completed and
executed copies of IRS Form W-8ECI before the first payment of
any interest is due under this Agreement and at any other time
reasonably requested by Agent or Administrative Borrower; and
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(iv) such other form or forms as may be required
under the IRC or other laws of the United States as a
condition to exemption from, or reduction of, United States
withholding tax.
Such Lender agrees promptly to notify Agent and Administrative Borrower of any
change in circumstances which would modify or render invalid any claimed
exemption or reduction.
(b) If any Lender claims exemption from, or reduction of,
withholding tax under a United States tax treaty by providing IRS Form W-8BEN
and such Lender sells, assigns, grants a participation in, or otherwise
transfers all or part of the Obligations of Borrowers to such Lender, such
Lender agrees to notify Agent of the percentage amount in which it is no longer
the beneficial owner of Obligations of Borrowers to such Lender. To the extent
of such percentage amount, Agent will treat such Lender's IRS Form W-8BEN as no
longer valid.
(c) If any Lender is entitled to a reduction in the
applicable withholding tax, Agent may withhold from any interest payment to such
Lender an amount equivalent to the applicable withholding tax after taking into
account such reduction. If the forms or other documentation required by
subsection (a) of this Section are not delivered to Agent, then Agent may
withhold from any interest payment to such Lender not providing such forms or
other documentation an amount equivalent to the applicable withholding tax.
(d) If the IRS or any other Governmental Authority of the
United States or other jurisdiction asserts a claim that Agent did not properly
withhold tax from amounts paid to or for the account of any Lender (because the
appropriate form was not delivered, was not properly executed, or because such
Lender failed to notify Agent of a change in circumstances which rendered the
exemption from, or reduction of, withholding tax ineffective, or for any other
reason) such Lender shall indemnify and hold Agent harmless for all amounts
paid, directly or indirectly, by Agent as tax or otherwise, including penalties
and interest, and including any taxes imposed by any jurisdiction on the amounts
payable to Agent under this Section, together with all costs and expenses
(including attorneys fees and expenses). The obligation of the Lenders under
this subsection shall survive the payment of all Obligations and the resignation
or replacement of Agent.
(e) All payments made by Borrowers hereunder or under any
note or other Loan Document will be made without setoff, counterclaim, or other
defense, except as required by Applicable Laws other than for Taxes (as defined
below). All such payments will be made free and clear of, and without deduction
or withholding for, any present or future taxes, levies, imposts, duties, fees,
assessments or other charges of whatever nature now or hereafter imposed by any
jurisdiction (other than the United States) or by any political subdivision or
taxing authority thereof or therein (other than of the United States) with
respect to such payments (but excluding, any tax imposed by any jurisdiction or
by any political subdivision or taxing authority thereof or therein (i) measured
by or based on the net income or net profits of a Lender, or (ii) to the extent
that such tax results from a change in the circumstances of the Lender,
including a change in the residence, place of organization, or principal place
of business of the Lender, or a change in the branch or lending office of the
Lender participating in the transactions set forth herein) and all interest,
penalties or similar liabilities with respect thereto (all such non-excluded
taxes, levies, imposts, duties, fees, assessments or other charges being
referred to collectively as
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"Taxes"). If any Taxes are so levied or imposed, each Borrower agrees to pay the
full amount of such Taxes, and such additional amounts as may be necessary so
that every payment of all amounts due under this Agreement or under any note,
including any amount paid pursuant to this Section 16.11(e) after withholding or
deduction for or on account of any Taxes, will not be less than the amount
provided for herein; provided, however, that Borrowers shall not be required to
increase any such amounts payable to Agent or any Lender (i) that is not
organized under the laws of the United States, if such Person fails to comply
with the other requirements of this Section 16.11, or (ii) if the increase in
such amount payable results from Agent's or such Lender's own willful misconduct
or gross negligence. Borrowers will furnish to Agent as promptly as possible
after the date the payment of any Taxes is due pursuant to Applicable Laws
certified copies of tax receipts evidencing such payment by Borrowers.
16.12 COLLATERAL MATTERS.
(a) The Lenders hereby irrevocably authorize Agent, at
its option and in its sole discretion, to release any Lien on any Collateral (i)
upon the termination of the Commitments and payment and satisfaction in full by
Borrowers of all Obligations, (ii) constituting property being sold or disposed
of if a release is required or desirable in connection therewith and if
Administrative Borrower certifies to Agent that the sale or disposition is
permitted under Section 7.4 of this Agreement or the other Loan Documents (and
Agent may rely conclusively on any such certificate, without further inquiry),
(iii) constituting property in which no Borrower and its Subsidiaries owned any
interest at the time the Agent's Lien was granted or at any time thereafter, or
(iv) constituting property leased to a Borrower and its Subsidiaries under a
lease that has expired or is terminated in a transaction permitted under this
Agreement. Except as provided above, Agent will not execute and deliver a
release of any Lien on any Collateral without the prior written authorization of
(y) if the release is of all or any substantial portion of the Collateral (which
shall be deemed to include sales or other dispositions of Collateral with a Fair
Market Valuation in excess of $35,000,000 over the Fair Market Valuation of the
Collateral that may be sold or otherwise disposed of under Section 7.4 hereof),
all of the Lenders, or (z) otherwise, the Required Lenders. Upon request by
Agent or Administrative Borrower at any time, the Lenders will confirm in
writing Agent's authority to release any such Liens on particular types or items
of Collateral pursuant to this Section 16.12; provided, however, that (1) Agent
shall not be required to execute any document necessary to evidence such release
on terms that, in Agent's opinion, would expose Agent to liability or create any
obligation or entail any consequence other than the release of such Lien without
recourse, representation, or warranty, and (2) such release shall not in any
manner discharge, affect, or impair the Obligations or any Liens (other than
those expressly being released) upon (or obligations of Borrowers in respect of)
all interests retained by Borrowers, including, the proceeds of any sale, all of
which shall continue to constitute part of the Collateral.
(b) Agent shall have no obligation whatsoever to any of
the Lenders to assure that the Collateral exists or is owned by Borrowers or
Guarantors or is cared for, protected, or insured or has been encumbered, or
that the Agent's Liens have been properly or sufficiently or lawfully created,
perfected, protected, or enforced or are entitled to any particular priority, or
to exercise at all or in any particular manner or under any duty of care,
disclosure or fidelity, or to continue exercising, any of the rights,
authorities and powers granted or available to Agent pursuant to any of the Loan
Documents, it being understood and agreed that in respect of the
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Collateral, or any act, omission, or event related thereto, subject to the terms
and conditions contained herein, Agent may act in any manner it may deem
appropriate, in its sole discretion given Agent's own interest in the Collateral
in its capacity as one of the Lenders and that Agent shall have no other duty or
liability whatsoever to any Lender as to any of the foregoing, except as
otherwise provided herein.
(c) Notwithstanding any provision in the Loan Documents
to the contrary, the Lenders hereby irrevocably authorize Agent, and Agent
hereby agrees that it shall, upon the written request of Administrative
Borrower, execute, have acknowledged as appropriate, and deliver to
Administrative Borrower such release documents as are reasonably necessary or
appropriate under the circumstances to effect the release of any Collateral to
the extent the sale of such Collateral is permitted under this Agreement. Agent
shall deliver any such release documents to Administrative Borrower (or, if
applicable, any closing attorney) to hold in escrow pending the closing of the
related transaction. In the event the closing of such transaction does not
occur, Administrative Borrower shall promptly return to Agent the release
documents executed and delivered by Agent.
16.13 RESTRICTIONS ON ACTIONS BY LENDERS; SHARING OF PAYMENTS.
(a) Each of the Lenders agrees that it shall not, without
the express written consent of Agent, and that it shall, to the extent it is
lawfully entitled to do so, upon the written request of Agent, set off against
the Obligations, any amounts owing by such Lender to Borrowers or any Deposit
Accounts of Borrowers now or hereafter maintained with such Lender. Each of the
Lenders further agrees that it shall not, unless specifically requested to do so
in writing by Agent, take or cause to be taken any action, including, the
commencement of any legal or equitable proceedings, to foreclose any Lien on, or
otherwise enforce any security interest in, any of the Collateral.
(b) If, at any time or times any Lender shall receive (i)
by payment, foreclosure, setoff, or otherwise, any proceeds of Collateral or any
payments with respect to the Obligations, except for any such proceeds or
payments received by such Lender from Agent pursuant to the terms of this
Agreement, or (ii) payments from Agent in excess of such Lender's Pro Rata Share
of all such distributions by Agent, such Lender promptly shall (1) turn the same
over to Agent, in kind, and with such endorsements as may be required to
negotiate the same to Agent, or in immediately available funds, as applicable,
for the account of all of the Lenders and for application to the Obligations in
accordance with the applicable provisions of this Agreement, or (2) purchase,
without recourse or warranty, an undivided interest and participation in the
Obligations owed to the other Lenders so that such excess payment received shall
be applied ratably as among the Lenders in accordance with their Pro Rata
Shares; provided, however, that if all or part of such excess payment received
by the purchasing party is thereafter recovered from it, those purchases of
participations shall be rescinded in whole or in part, as applicable, and the
applicable portion of the purchase price paid therefor shall be returned to such
purchasing party, but without interest except to the extent that such purchasing
party is required to pay interest in connection with the recovery of the excess
payment.
16.14 AGENCY FOR PERFECTION. Agent hereby appoints each other Lender
as its agent (and each Lender hereby accepts such appointment) for the purpose
of perfecting the Agent's
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Liens in assets which, in accordance with Article 9 of the Code can be perfected
only by possession or control. Should any Lender obtain possession or control of
any such Collateral, such Lender shall notify Agent thereof, and, promptly upon
Agent's request therefor shall deliver possession or control of such Collateral
to Agent or in accordance with Agent's instructions.
16.15 PAYMENTS BY AGENT TO THE LENDERS. All payments to be made by
Agent to the Lenders shall be made by bank wire transfer or internal transfer of
immediately available funds pursuant to such wire transfer instructions as each
party may designate for itself by written notice to Agent. Concurrently with
each such payment, Agent shall identify whether such payment (or any portion
thereof) represents principal, premium, or interest of the Obligations.
16.16 CONCERNING THE COLLATERAL AND RELATED LOAN DOCUMENTS. Each
member of the Lender Group authorizes and directs Agent to enter into this
Agreement and the other Loan Documents relating to the Collateral, for the
benefit of the Lender Group and the Bank Product Providers. Each member of the
Lender Group agrees that any action taken by Agent in accordance with the terms
of this Agreement or the other Loan Documents relating to the Collateral and the
exercise by Agent of its powers set forth therein or herein, together with such
other powers that are reasonably incidental thereto, shall be binding upon all
of the Lenders.
16.17 FIELD AUDITS AND EXAMINATION REPORTS; CONFIDENTIALITY;
DISCLAIMERS BY LENDERS; OTHER REPORTS AND INFORMATION. By becoming a party to
this Agreement, each Lender:
(a) is deemed to have requested that Agent furnish such
Lender, promptly after it becomes available, a copy of each field audit or
examination report (each a "Report" and collectively, "Reports") prepared by or
at the request of Agent, and Agent shall so furnish each Lender with such
Reports,
(b) expressly agrees and acknowledges that Agent does not
(i) make any representation or warranty as to the accuracy of any Report, and
(ii) shall not be liable for any information contained in any Report,
(c) expressly agrees and acknowledges that the Reports
are not comprehensive audits or examinations, that Agent or other party
performing any audit or examination will inspect only specific information
regarding Borrowers and will rely significantly upon Loan Parties' Books, as
well as on representations of Borrowers' personnel,
(d) agrees to keep all Reports and other material,
non-public information regarding Borrowers and their Subsidiaries and their
operations, assets, and existing and contemplated business plans in a
confidential manner in accordance with Section 17.10, and
(e) without limiting the generality of any other
indemnification provision contained in this Agreement, agrees: (i) to hold Agent
and any such other Lender preparing a Report harmless from any action the
indemnifying Lender may take or conclusion the indemnifying Lender may reach or
draw from any Report in connection with any loans or other credit accommodations
that the indemnifying Lender has made or may make to Borrowers, or the
indemnifying Lender's participation in, or the indemnifying Lender's purchase
of, a loan or loans of Borrowers; and (ii) to pay and protect, and indemnify,
defend and hold Agent, and any
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such other Lender preparing a Report harmless from and against, the claims,
actions, proceedings, damages, costs, expenses, and other amounts (including,
attorneys' fees and costs) incurred by Agent and any such other Lender preparing
a Report as the direct or indirect result of any third parties who might obtain
all or part of any Report through the indemnifying Lender.
In addition to the foregoing: (x) any Lender may from time to time request in
writing that Agent provide to such Lender a copy of any report or document
provided by Borrowers to Agent that has not been contemporaneously provided by
Borrowers to such Lender, and, upon receipt of such request, Agent shall provide
a copy of same to such Lender, (y) to the extent that Agent is entitled, under
any provision of the Loan Documents, to request additional reports or
information from Borrowers, any Lender may, from time to time, reasonably
request Agent to exercise such right as specified in such Lender's notice to
Agent, whereupon Agent promptly shall request of Administrative Borrower the
additional reports or information reasonably specified by such Lender, and, upon
receipt thereof from Administrative Borrower, Agent promptly shall provide a
copy of same to such Lender, and (z) any time that Agent renders to
Administrative Borrower a statement regarding the Loan Account, Agent shall send
a copy of such statement to each Lender.
16.18 SEVERAL OBLIGATIONS; NO LIABILITY. Notwithstanding that
certain of the Loan Documents now or hereafter may have been or will be executed
only by or in favor of Agent in its capacity as such, and not by or in favor of
the Lenders, any and all obligations on the part of Agent (if any) or any Lender
to make any credit available hereunder shall constitute the several (and not
joint) obligations of the respective Lenders on a ratable basis, according to
their respective Commitments, to make an amount of such credit not to exceed, in
principal amount, at any one time outstanding, the amount of their respective
Commitments. Nothing contained herein shall confer upon any Lender any interest
in, or subject any Lender to any liability for, or in respect of, the business,
assets, profits, losses, or liabilities of any other Lender. Each Lender shall
be solely responsible for notifying its Participants of any matters relating to
the Loan Documents to the extent any such notice may be required, and no Lender
shall have any obligation, duty, or liability to any Participant of any other
Lender. Except as provided in Section 16.7, no member of the Lender Group shall
have any liability for the acts or any other member of the Lender Group. No
Lender shall be responsible to any Borrower or any other Person for any failure
by any other Lender to fulfill its obligations to make credit available
hereunder, nor to advance for it or on its behalf in connection with its
Commitment, nor to take any other action on its behalf hereunder or in
connection with the financing contemplated herein.
16.19 [INTENTIONALLY OMITTED.]
16.20 ADDITIONAL AGENTS. None of the Lenders or other entities
identified on the facing page of or elsewhere in this Agreement as a "Lead
Arranger", "Syndication Agent" or "Co-Documentation Agent" shall have any right,
power, obligation, liability, responsibility or duty under this Agreement or any
other Loan Document other than those applicable to all Lenders as such. Without
limiting the foregoing, none of the Lenders so identified shall have or be
deemed to have any fiduciary relationship with any other Lender. Each Lender
acknowledges that it has not relied, and will not rely, on any of the Lenders or
other entities so identified in deciding to enter into this Agreement or any
other Loan Document or in taking or not taking action hereunder or thereunder.
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16.21 QUEBEC SECURITY. For greater certainty, and without limiting
the powers of Agent or any other Person acting as an agent for the Lender Group
hereunder or under any of the Loan Documents, each Borrower hereby acknowledges
that, for purposes of holding any Liens, including hypothecs, granted or to be
granted by any Borrower or any Guarantor on movable or immovable property
pursuant to the laws of the Province of Quebec to secure obligations of any
Borrower or any Guarantor under any bond issued by any Borrower or any
Guarantor, Agent shall be the holder of an irrevocable power of attorney (fonde
de pouvoir within the meaning of Article 2692 of the Civil Code of Quebec) (the
"Fonde de pouvoir") for and on behalf of (i) all present and future Lenders
(including the Issuing Lender), (ii) the Issuing Lender and the Underlying
Issuer that may from time to time, and respectively, issue L/C and L/C
Undertaking for the account of Borrowers, and (iii) any Bank Product Provider
that may from time to time extend Bank Products to Administrative Borrower or
its Subsidiaries. Each Lender (including the Issuing Lender), for itself and on
behalf of any Underlying Issuer that issues or may issue L/C Undertaking for the
account of Borrowers and any Bank Product Provider that extends or may extend
Bank Products to Administrative Borrower or its Subsidiaries, hereby (i)
irrevocably constitutes, to the extent necessary, Agent as the Fonde de pouvoir
in order to hold Liens, including hypothecs, granted or to be granted by any
Borrower or any Guarantor on movable and immovable property pursuant to the laws
of the Province of Quebec to secure obligations of any Borrower or any Guarantor
under any bond issued by any Borrower or any Guarantor; and (ii) appoints and
agrees that Agent, acting as administrative agent for the Lenders (including the
Issuing Lender) may act as the bondholder and mandatary with respect to any bond
that may be issued and pledged from time to time for the benefit of the Lenders
(including the Issuing Lender), any Underlying Issuer and any Bank Product
Provider.
The said constitution of the Fonde de pouvoir as the holder of such
irrevocable power of attorney and of Agent as bondholder and mandatory with
respect to any bond that may be issued and pledged from time to time for the
benefit of the Lenders (including the Issuing Lender), the Underlying Issuer and
the Bank Product Provider shall be deemed to have been ratified and confirmed as
follows:
(i) by any Assignee by the execution of an
Assignment and Acceptance;
(ii) by any Issuing Lender, Underlying Issuer or
Bank Product Provider by the issuance or execution, as the
case may be, of L/C, L/C Undertaking or Bank Product; and
(iii) by any assignee of the Issuing Lender, the
Underlying Issuer or of the Bank Product Provider by the
execution of an assignment agreement.
Notwithstanding the provisions of Section 32 of the An Act respecting
the special powers of legal persons (Quebec), Agent may purchase, acquire and be
the holder of any bond issued by any Borrower or any Guarantor (i.e. the Fonde
de pouvoir may acquire and hold the first bond issued under any deed of hypothec
granted by any Borrower or any Guarantor). Each Borrower hereby acknowledges
that any such bond shall constitute a title of indebtedness, as such term is
used in Article 2692 of the Civil Code of Quebec.
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Agent herein appointed as Fonde de pouvoir shall have the same rights,
powers and immunities as the Agent as stipulated in this Section 16, which shall
apply mutatis mutandis. Without limitation, the provisions of Section 16.9 shall
apply mutatis mutandis to the resignation and appointment of a successor to
Agent acting as Fonde de pouvoir.
17. GENERAL PROVISIONS.
17.1 EFFECTIVENESS. This Agreement shall be binding and deemed
effective when executed by Borrowers, Agent, and each Lender whose signature is
provided for on the signature pages hereof.
17.2 SECTION HEADINGS. Headings and numbers have been set forth
herein for convenience only. Unless the contrary is compelled by the context,
everything contained in each Section applies equally to this entire Agreement.
17.3 INTERPRETATION. Neither this Agreement nor any uncertainty or
ambiguity herein shall be construed or resolved against the Lender Group or
Borrowers, whether under any rule of construction or otherwise. On the contrary,
this Agreement has been reviewed by all parties and shall be construed and
interpreted according to the ordinary meaning of the words used so as to
accomplish fairly the purposes and intentions of all parties hereto.
17.4 SEVERABILITY OF PROVISIONS. Each provision of this Agreement
shall be severable from every other provision of this Agreement for the purpose
of determining the legal enforceability of any specific provision. Furthermore,
the provisions of any Loan Document shall be severable from the provisions of
every other Loan Document for the purpose of determining the legal
enforceability of any specific provision.
17.5 AMENDMENTS IN WRITING. This Agreement only can be amended by a
writing in accordance with Section 15.1.
17.6 COUNTERPARTS; TELEFACSIMILE EXECUTION. This Agreement may be
executed in any number of counterparts and by different parties on separate
counterparts, each of which, when executed and delivered, shall be deemed to be
an original, and all of which, when taken together, shall constitute but one and
the same Agreement. Delivery of an executed counterpart of this Agreement by
telefacsimile or via email transmission of an Adobe portable document format
file (also known as a "PDF File") shall be equally as effective as delivery of
an original executed counterpart of this Agreement. Any party delivering an
executed counterpart of this Agreement by telefacsimile or via email
transmission of an Adobe portable document format file (also known as a "PDF
File") also shall deliver an original executed counterpart of this Agreement but
the failure to deliver an original executed counterpart shall not affect the
validity, enforceability, and binding effect of this Agreement. The foregoing
shall apply to each other Loan Document mutatis mutandis.
17.7 REVIVAL AND REINSTATEMENT OF OBLIGATIONS. If the incurrence or
payment of the Obligations by any Borrower or any Guarantor or the transfer to
the Lender Group of any property should for any reason subsequently be declared
to be void or voidable under any state or federal law relating to creditors'
rights, including provisions of the Bankruptcy Code relating to fraudulent
conveyances, preferences, or other voidable or recoverable payments of money or
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transfers of property (collectively, a "Voidable Transfer"), and if the Lender
Group is required to repay or restore, in whole or in part, any such Voidable
Transfer, or elects to do so upon the reasonable advice of its counsel, then, as
to any such Voidable Transfer, or the amount thereof that the Lender Group is
required or elects to repay or restore, and as to all reasonable costs,
expenses, and attorneys fees of the Lender Group related thereto, the liability
of Borrowers or Guarantors automatically shall be revived, reinstated, and
restored and shall exist as though such Voidable Transfer had never been made.
17.8 INTEGRATION. This Agreement, together with the other Loan
Documents, reflects the entire understanding of the parties with respect to the
transactions contemplated hereby and shall not be contradicted or qualified by
any other agreement, oral or written, before the date hereof.
17.9 PARENT AS AGENT FOR BORROWERS. Each Borrower hereby
irrevocably appoints Parent as the borrowing agent and attorney-in-fact for all
Borrowers ("Administrative Borrower") which appointment shall remain in full
force and effect unless and until Agent shall have received prior written notice
signed by each Borrower that such appointment has been revoked and that another
Borrower has been appointed Administrative Borrower. Each Borrower hereby
irrevocably appoints and authorizes Administrative Borrower (i) to provide Agent
with all notices with respect to Advances and Letters of Credit obtained for the
benefit of any Borrower and all other notices and instructions under this
Agreement and (ii) to take such action as Administrative Borrower deems
appropriate on its behalf to obtain Advances and Letters of Credit and to
exercise such other powers as are reasonably incidental thereto to carry out the
purposes of this Agreement. It is understood that the handling of the Loan
Account and Collateral in a combined fashion, as more fully set forth herein, is
done solely as an accommodation to Borrowers in order to utilize the collective
borrowing powers of Borrowers in the most efficient and economical manner and at
their request, and that Lender Group shall not incur liability to any Borrower
as a result hereof. Each Borrower expects to derive benefit, directly or
indirectly, from the handling of the Loan Account and the Collateral in a
combined fashion since the successful operation of each Borrower is dependent on
the continued successful performance of the integrated group. To induce the
Lender Group to do so, and in consideration thereof, each Borrower hereby
jointly and severally agrees to indemnify each member of the Lender Group and
hold each member of the Lender Group harmless against any and all liability,
expense, loss or claim of damage or injury, made against the Lender Group by any
Borrower or by any third party whosoever, arising from or incurred by reason of
(a) the handling of the Loan Account and Collateral as herein provided, (b) the
Lender Group's relying on any instructions of Administrative Borrower, or (c)
any other action taken by the Lender Group hereunder or under the other Loan
Documents, except that Borrowers will have no liability to the relevant
Agent-Related Person or Lender-Related Person under this Section 17.9 with
respect to any liability that has been finally determined by a court of
competent jurisdiction to have resulted solely from the gross negligence or
willful misconduct of such Agent-Related Person or Lender-Related Person, as the
case may be.
17.10 CONFIDENTIALITY. Agent and the Lenders each individually (and
not jointly or jointly and severally) agree that material, non-public
information regarding Borrowers and their Subsidiaries, their operations,
assets, and existing and contemplated business plans shall be treated by Agent
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and the Lenders in a confidential manner, and shall not be disclosed by Agent
and the Lenders to Persons who are not parties to this Agreement, except: (a) to
attorneys for and other advisors, accountants, auditors, and consultants to any
member of the Lender Group, (b) to Subsidiaries and Affiliates of any member of
the Lender Group (including the Bank Product Providers), provided that any such
Subsidiary or Affiliate shall have agreed to receive such information hereunder
subject to the terms of this Section 17.10, (c) as may be required by statute,
decision, or the Court or other judicial or administrative order, rule, or
regulation, or to the extent requested by any regulatory authority purporting to
have jurisdiction over any Lender (including any self-regulatory authority, such
as the National Association of Insurance Commissioners), (d) as may be agreed to
in advance by Administrative Borrower or its Subsidiaries or as requested or
required by any Governmental Authority pursuant to any subpoena or other legal
process, (e) as to any such information that is or becomes generally available
to the public (other than as a result of prohibited disclosure by Agent or the
Lenders), (f) in connection with any assignment, prospective assignment, sale,
prospective sale, participation or prospective participations, or pledge or
prospective pledge of any Lender's interest under this Agreement, provided that
any such assignee, prospective assignee, purchaser, prospective purchaser,
participant, prospective participant, pledgee, or prospective pledgee shall have
agreed in writing to receive such information hereunder subject to the terms of
this Section, and (g) in connection with any litigation or other adversary
proceeding involving parties hereto which such litigation or adversary
proceeding involves claims related to the rights or duties of such parties under
this Agreement or the other Loan Documents. The provisions of this Section 17.10
shall survive for 2 years after the payment in full of the Obligations. Anything
contained herein or in any other Loan Document to the contrary notwithstanding,
the obligations of confidentiality contained herein and therein, as they relate
to the transactions contemplated hereby, shall not apply to the federal tax
structure or federal tax treatment of such transactions, and each party hereto
(and any employee, representative, or agent of any party hereto) may disclose to
any and all Persons, without limitation of any kind, the federal tax structure
and federal tax treatment of such transactions (including all written materials
related to such tax structure and tax treatment). The preceding sentence is
intended to cause the transactions contemplated hereby to not be treated as
having been offered under conditions of confidentiality for purposes of Section
1.6011-4(b)(3) (or any successor provision) of the Treasury Regulations
promulgated under Section 6011 of the IRC and shall be construed in a manner
consistent with such purpose. In addition, each party hereto acknowledges that
it has no proprietary or exclusive rights to the tax structure of the
transactions contemplated hereby or any tax matter or tax idea related thereto.
[Signature pages to follow]
129
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered as of the date first above written.
BORROWERS: AMERCO, a Nevada corporation
By: /s/ Xxxx X. Xxxxxxxxxxx
___________________________________
Title: Secretary
________________________________
AMERCO REAL ESTATE COMPANY,
a Nevada corporation
By: /s/ Xxxxxx Xxxxxxxx
___________________________________
Title: President
________________________________
AMERCO REAL ESTATE COMPANY
OF ALABAMA, INC., an Alabama
corporation
By: /s/ Xxxxxx Xxxxxxxx
___________________________________
Title: President
________________________________
AMERCO REAL ESTATE COMPANY
OF TEXAS, INC., a Texas
corporation
By: /s/ Xxxxxx Xxxxxxxx
___________________________________
Title: President
________________________________
FIVE PAC COMPANY, a Nevada corporation
By: /s/ Xxxxxx Xxxxxxxx
___________________________________
Title: President
________________________________
FOURTEEN PAC COMPANY, a Nevada corporation
By: /s/ Xxxxxx Xxxxxxxx
___________________________________
Title: President
________________________________
LOAN AND SECURITY AGREEMENT
S-1
ONE PAC COMPANY, a Nevada corporation
By: /s/ Xxxxxx Xxxxxxxx
___________________________________
Title: President
________________________________
LOAN AND SECURITY AGREEMENT
S-2
SEVEN PAC COMPANY, a Nevada corporation
By: /s/ Xxxxxx Xxxxxxxx
___________________________________
Title: President
________________________________
SIXTEEN PAC COMPANY, a Nevada corporation
By: /s/ Xxxxxx Xxxxxxxx
___________________________________
Title: President
________________________________
TEN PAC COMPANY, a Nevada corporation
By: /s/ Xxxxxx Xxxxxxxx
___________________________________
Title: President
________________________________
U-HAUL CO. OF ALASKA, an Alaska corporation
By: /s/ Xxxx X. Xxxxxxxxxxx
___________________________________
Title: Secretary
________________________________
U-HAUL CO. OF ARIZONA, an Arizona corporation
By: /s/ Xxxx X. Xxxxxxxxxxx
___________________________________
Title: Secretary
________________________________
U-HAUL CO. OF FLORIDA, a Florida corporation
By: /s/ Xxxx X. Xxxxxxxxxxx
___________________________________
Title: Secretary
________________________________
LOAN AND SECURITY AGREEMENT
S-3
U-HAUL CO. OF HAWAII, INC., a Hawaii corporation
By: /s/ Xxxx X. Xxxxxxxxxxx
___________________________________
Title: Secretary
________________________________
LOAN AND SECURITY AGREEMENT
S-4
U-HAUL INTERNATIONAL, INC., a Nevada corporation
By: /s/ Xxxx X. Xxxxxxxxxxx
___________________________________
Title: Secretary
________________________________
YONKERS PROPERTY CORPORATION,
a New York corporation
By: /s/ Xxxx X. Xxxxxxxxxxx
___________________________________
Title: Secretary
________________________________
AGENT AND LENDERS: XXXXX FARGO FOOTHILL, INC.,
a California corporation, as Agent and as Lender
By: /s/ [Illegible]
___________________________________
Title: ________________________________
LOAN AND SECURITY AGREEMENT
S-5
TABLE OF CONTENTS
PAGE
1. DEFINITIONS AND CONSTRUCTION................................................................. 2
1.1 Definitions......................................................................... 2
1.2 Accounting Terms; GAAP.............................................................. 38
1.3 Code................................................................................ 39
1.4 Construction........................................................................ 39
1.5 Schedules and Exhibits.............................................................. 39
2. LOAN AND TERMS OF PAYMENT.................................................................... 39
2.1 Revolver Advances................................................................... 39
2.2 Term Loan........................................................................... 40
2.3 Borrowing Procedures and Settlements................................................ 40
2.4 Payments............................................................................ 47
2.5 Overadvances........................................................................ 50
2.6 Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations......... 50
2.7 Cash Management..................................................................... 52
2.8 Crediting Payments.................................................................. 53
2.9 Designated Account.................................................................. 53
2.10 Maintenance of Loan Account; Statements of Obligations.............................. 54
2.11 Fees................................................................................ 54
2.12 Letters of Credit................................................................... 54
2.13 LIBOR Option........................................................................ 58
2.14 Capital Requirements................................................................ 60
2.15 Joint and Several Liability of Borrowers............................................ 61
2.16 Registered Notes.................................................................... 63
3. CONDITIONS; TERM OF AGREEMENT................................................................ 63
3.1 Conditions Precedent to the Initial Extension of Credit............................. 63
3.2 Conditions Subsequent to the Initial Extension of Credit............................ 68
3.3 Conditions Precedent to all Extensions of Credit.................................... 68
3.4 Term................................................................................ 69
3.5 Effect of Termination............................................................... 69
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TABLE OF CONTENTS
(continued)
PAGE
3.6 Early Termination by Borrowers...................................................... 69
4. CREATION OF SECURITY INTEREST................................................................ 70
4.1 Grant of Security Interest.......................................................... 70
4.2 Negotiable Collateral and Chattel Paper............................................. 70
4.3 Collection of Accounts, General Intangibles, and Negotiable Collateral.............. 71
4.4 Delivery of Additional Documentation Required....................................... 71
4.5 Power of Attorney................................................................... 72
4.6 Right to Inspect.................................................................... 72
4.7 Control Agreements.................................................................. 73
4.8 Commercial Tort Claims.............................................................. 73
4.9 Grants, Rights and Remedies......................................................... 73
4.10 Survival............................................................................ 74
5. REPRESENTATIONS AND WARRANTIES............................................................... 74
5.1 No Encumbrances..................................................................... 74
5.2 Ownership of Certain Assets......................................................... 74
5.3 [Intentionally Omitted.]............................................................ 74
5.4 Equipment........................................................................... 74
5.5 Location of Equipment............................................................... 74
5.6 Equipment Records................................................................... 74
5.7 Location of Chief Executive Office; FEIN; Organizational ID Number.................. 74
5.8 Due Organization and Qualification; Subsidiaries; Affiliates........................ 75
5.9 Due Authorization; No Conflict...................................................... 76
5.10 Litigation.......................................................................... 77
5.11 Financial Statements; No Material Adverse Change.................................... 77
5.12 Fraudulent Transfer................................................................. 78
5.13 Employee Benefits................................................................... 78
5.14 Environmental Condition............................................................. 78
5.15 Brokerage Fees...................................................................... 78
5.16 Intellectual Property............................................................... 79
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TABLE OF CONTENTS
(continued)
PAGE
5.17 Leases.............................................................................. 79
5.18 DDAs................................................................................ 79
5.19 Complete Disclosure................................................................. 79
5.20 Indebtedness, Etc................................................................... 79
5.21 Confirmation Order.................................................................. 80
5.22 Reservation Management System....................................................... 80
5.23 Taxes and Remittances............................................................... 80
5.24 Investigations...................................................................... 80
5.25 Vehicles............................................................................ 80
5.26 Anti-Terrorism Laws................................................................. 81
6. AFFIRMATIVE COVENANTS........................................................................ 82
6.1 Accounting System................................................................... 82
6.2 Collateral Reporting................................................................ 82
6.3 Financial Statements, Reports, Certificates......................................... 82
6.4 Guarantor Reports................................................................... 85
6.5 [Intentionally Omitted.]............................................................ 85
6.6 Maintenance of Properties........................................................... 85
6.7 Taxes............................................................................... 86
6.8 Insurance........................................................................... 86
6.9 Location of Equipment............................................................... 87
6.10 Compliance with Laws................................................................ 87
6.11 Leases.............................................................................. 87
6.12 Brokerage Commissions............................................................... 87
6.13 Existence........................................................................... 88
6.14 Environmental....................................................................... 88
6.15 Disclosure Updates.................................................................. 88
6.16 Material Contracts; Affiliate Contracts............................................. 88
6.17 Employee Benefits................................................................... 88
6.18 Real Estate......................................................................... 89
6.19 Reorganization Plan................................................................. 90
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TABLE OF CONTENTS
(continued)
PAGE
6.20 Vehicles............................................................................ 90
7. NEGATIVE COVENANTS........................................................................... 90
7.1 Indebtedness, Etc................................................................... 90
7.2 Liens............................................................................... 92
7.3 Restrictions on Fundamental Changes................................................. 92
7.4 Disposal of Assets.................................................................. 92
7.5 Change Name......................................................................... 93
7.6 Guarantee........................................................................... 93
7.7 Nature of Business.................................................................. 93
7.8 Prepayments and Amendments.......................................................... 93
7.9 Change of Control................................................................... 94
7.10 Ownership of Certain Assets......................................................... 95
7.11 Distributions....................................................................... 95
7.12 Accounting Methods.................................................................. 95
7.13 Formation of Subsidiaries; Investments.............................................. 95
7.14 Transactions with Affiliates........................................................ 96
7.15 Suspension.......................................................................... 97
7.16 [Intentionally Omitted.]............................................................ 97
7.17 Use of Proceeds..................................................................... 97
7.18 Change in Location of Chief Executive Office; Equipment with Bailees................ 97
7.19 Securities Accounts................................................................. 97
7.20 Financial Covenants................................................................. 97
7.21 No Prohibited Transactions Under ERISA.............................................. 99
7.22 Sales and Leasebacks................................................................ 100
7.23 Anti-Terrorism Laws................................................................. 100
7.24 Speculative Transactions............................................................ 100
8. EVENTS OF DEFAULT............................................................................ 100
9. THE LENDER GROUP'S RIGHTS AND REMEDIES....................................................... 103
9.1 Rights and Remedies................................................................. 103
-iv-
TABLE OF CONTENTS
(continued)
PAGE
9.2 Remedies Cumulative................................................................. 105
10. TAXES AND EXPENSES........................................................................... 105
11. WAIVERS; INDEMNIFICATION..................................................................... 106
11.1 Demand; Protest; etc................................................................ 106
11.2 The Lender Group's Liability for Collateral......................................... 106
11.3 Indemnification..................................................................... 106
12. NOTICES...................................................................................... 107
13. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER................................................... 109
14. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS................................................... 109
14.1 Assignments and Participations...................................................... 109
14.2 Successors.......................................................................... 113
15. AMENDMENTS; WAIVERS.......................................................................... 114
15.1 Amendments and Waivers.............................................................. 114
15.2 Replacement of Holdout Lender....................................................... 115
15.3 No Waivers; Cumulative Remedies..................................................... 115
15.4 WP Xxxxx Transaction................................................................ 115
16. AGENT; THE LENDER GROUP...................................................................... 116
16.1 Appointment and Authorization of Agent.............................................. 116
16.2 Delegation of Duties................................................................ 116
16.3 Liability of Agent.................................................................. 117
16.4 Reliance by Agent................................................................... 117
16.5 Notice of Default or Event of Default............................................... 117
16.6 Credit Decision..................................................................... 118
16.7 Costs and Expenses; Indemnification................................................. 118
16.8 Agent in Individual Capacity........................................................ 119
16.9 Successor Agent..................................................................... 119
16.10 Lender in Individual Capacity....................................................... 120
16.11 Withholding Taxes................................................................... 120
16.12 Collateral Matters.................................................................. 122
16.13 Restrictions on Actions by Lenders; Sharing of Payments............................. 123
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TABLE OF CONTENTS
(continued)
PAGE
16.14 Agency for Perfection............................................................... 123
16.15 Payments by Agent to the Lenders.................................................... 124
16.16 Concerning the Collateral and Related Loan Documents................................ 124
16.17 Field Audits and Examination Reports; Confidentiality; Disclaimers by Lenders; Other
Reports and Information............................................................. 124
16.18 Several Obligations; No Liability................................................... 125
16.19 [Intentionally Omitted.]............................................................ 125
16.20 Additional Agents................................................................... 125
16.21 Quebec Security..................................................................... 126
17. GENERAL PROVISIONS........................................................................... 127
17.1 Effectiveness....................................................................... 127
17.2 Section Headings.................................................................... 127
17.3 Interpretation...................................................................... 127
17.4 Severability of Provisions.......................................................... 127
17.5 Amendments in Writing............................................................... 127
17.6 Counterparts; Telefacsimile Execution............................................... 127
17.7 Revival and Reinstatement of Obligations............................................ 127
17.8 Integration......................................................................... 128
17.9 Parent as Agent for Borrowers....................................................... 128
17.10 Confidentiality..................................................................... 128
-vi-
EXHIBITS AND SCHEDULES
Exhibit A-1 Form of Assignment and Acceptance Agreement
Exhibit B-1 Form of Borrowing Base Certificate
Exhibit C-1 Form of Compliance Certificate
Exhibit L-1 Form of LIBOR Notice
Schedule A-1 Affiliate Contracts
Schedule A-2 Agent's Account
Schedule C-1 Commercial Tort Claims
Schedule C-2 Commitments
Schedule D-1 Designated Account
Schedule E-1 Excluded Assets
Schedule G-1 Guarantors
Schedule M-1 Material Contracts
Schedule P-1 Permitted Liens
Schedule R-1 Real Property Collateral
Schedule W-1 WP Xxxxx Transaction
Schedule 2.7(a) Cash Management Banks
Schedule 2.7(e) Cash Collateral Accounts
Schedule 3.1(d) Collateral Access Agreements
Schedule 3.1(t) Contracts with SAC Holding, SSI, PMSR or PM Preferred
Schedule 3.1(w) Book Value of Trucks
Schedule 3.2(d) Zoning Letters
Schedule 3.2(e) Subordinated, Non-Disturbance and Attornment Agreements
Schedule 5.7 Chief Executive Office; FEIN; Organizational ID Number
Schedule 5.8(b) Capitalization of Borrowers
Schedule 5.8(c) Capitalization of Borrowers' and Guarantors' Subsidiaries
Schedule 5.8(d) Subscriptions; Options; Warrants
Schedule 5.8(e) Affiliates
Schedule 5.10 Litigation
Schedule 5.13 Employee Benefits
Schedule 5.14 Environmental Matters
Schedule 5.16 Intellectual Property
Schedule 5.18 Demand Deposit Accounts
Schedule 5.20(a) Indebtedness as of the Closing Date
Schedule 5.20(b) TRAC Lease Transactions as of the Closing Date
Schedule 5.20(c) Maximum Debt; Refinancing Indebtedness
Schedule 7.8(a) Scheduled Payments under Synthetic Leases
SCHEDULE A-2
AGENT'S ACCOUNT
An account at a bank designated by Agent from time to time as
the account into which Borrowers shall make all payments to Agent for the
benefit of the Lender Group and into which the Lender Group shall make all
payments to Agent under this Agreement and the other Loan Documents; unless and
until Agent notifies Administrative Borrower and the Lender Group to the
contrary, Agent's Account shall be that certain deposit account bearing account
number 323-266193 and maintained by Agent with JPMorgan Chase Bank, 0 Xxx Xxxx
Xxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, ABA #000000000.
SCHEDULE C-2
COMMITMENTS
LENDER REVOLVER COMMITMENT TERM LOAN COMMITMENT TOTAL COMMITMENT
------ ------------------- -------------------- ----------------
Xxxxx Fargo Foothill, Inc. $200,000,000 $350,000,000 $550,000,000
All Lenders $200,000,000 $350,000,000 $550,000,000
SCHEDULE D-1
DESIGNATED ACCOUNT
Account number 42-4903 of Administrative Borrower maintained
with Administrative Borrower's Designated Account Bank, or such other deposit
account of Administrative Borrower (located within the United States) that has
been designed as such, in writing, by Administrative Borrower to Agent.
"Designated Account Bank" means Bank One Arizona whose office
is located at 000 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx 00000 and whose ABA
number is 000000000.
GUARANTY
This GUARANTY (this "Guaranty") is entered into as of March 1, 2004, by
each of the parties listed on the signature page hereof as a guarantor, together
with those additional entities that hereafter become parties hereto by executing
the form of Supplement attached hereto as Annex 1 (each, a "Guarantor", and
collectively, the "Guarantors"), in favor of Xxxxx Fargo Foothill Inc., a
California corporation, as administrative agent and collateral agent for the
Lenders (as defined in the hereinafter defined Loan Agreement) ("Agent").
W I T N E S S E T H:
WHEREAS, AMERCO, a Nevada corporation, and each of its Subsidiaries (as
defined in the hereinafter defined Loan Agreement) that are signatories thereto,
as borrowers (collectively, the "Borrowers"), Agent, and the Lenders are parties
to that certain Loan and Security Agreement dated as of even date herewith (as
the same may be amended, restated, supplemented or otherwise modified from time
to time, the "Loan Agreement"; capitalized terms used herein and not otherwise
defined shall have the meanings ascribed to such terms in the Loan Agreement),
pursuant to which the Lender Group has agreed to make Advances, issue Letters of
Credit and make other extensions of credit to the Borrowers from time to time
pursuant to the terms and conditions thereof and the other Loan Documents; and
WHEREAS, the Guarantors are direct or indirect Subsidiaries of a
Borrower, and each Guarantor has determined that it will realize substantial
direct and indirect benefits as a result of the loans and other financial
accommodations extended to the Borrowers pursuant to the Loan Agreement, and
such Guarantor's execution, delivery and performance of this Guaranty are within
such Guarantor's corporate or other purposes and are in the best interests of
such Guarantor; and
WHEREAS, it is a condition precedent to the execution and
delivery of the Loan Agreement by the Lender Group and the extension of the
loans and other financial accommodations to the Borrowers thereunder that each
Guarantor execute and deliver this Guaranty to Agent; and
WHEREAS, the obligations of each Guarantor hereunder are secured by
security interests granted to Agent, for the benefit of the Lender Group and the
Bank Product Providers, pursuant to that certain Guarantor Security Agreement
dated as of even date herewith, among the Guarantors (as defined in the Loan
Agreement) and Agent (the "Guarantor Security Agreement"), and any other Loan
Documents to which such Guarantor is a party;
NOW, THEREFORE, for and in consideration of the recitals made above,
and other good and valuable consideration, the receipt, sufficiency and adequacy
of which are hereby acknowledged, each Guarantor hereby agrees as follows:
1. Guaranty. Each Guarantor hereby guarantees to Agent,
for the benefit of the Lender Group and the Bank Product Providers, the full and
prompt payment and performance of (a) the Obligations and the other covenants,
agreements and liabilities of the Borrowers under the Loan Agreement and the
other Loan Documents and (b) all of the
obligations of each Guarantor and the other Guarantors (as defined in the Loan
Agreement) to Agent under (i) this Guaranty, (ii) that certain Guarantee as of
even date herewith, given by U-Haul Co. (Canada) Ltd. U-Haul Co. (Canada) Ltee
and U-Haul Inspections, Ltd. to Agent, and (iii) all other Loan Documents and
any extensions, renewals or amendments to any of the foregoing, however created,
acquired, arising or evidenced, whether arising during or after the initial or
any renewal term of the Loan Agreement or after the commencement of any
Insolvency Proceeding (including, without limitation, those applicable to
Guarantors located in a foreign jurisdiction) with respect to any Borrower
(including, without limitation, the payment of interest and other amounts which
would accrue and become due but for the commencement of such Insolvency
Proceeding, and whether or not such claim is allowed in such Insolvency
Proceeding), whether direct or indirect, absolute or contingent, now or
hereafter existing, joint or several, due or to become due, primary or
secondary, liquidated or unliquidated, secured or unsecured, and however
acquired by Agent or any other member of the Lender Group, including, without
limitation, any interest on any of the foregoing, plus reasonable attorneys'
fees and expenses if the obligations represented by this Guaranty are collected
by law, through an attorney-at-law, or under advice therefrom (all of the
foregoing now existing or hereafter arising obligations being referred to,
collectively, as the "Guaranteed Obligations").
2. Joint and Several Liability. Regardless of whether
any proposed guarantor, surety or any other Person or Persons is or are or shall
become in any other way responsible to the Lender Group, the Bank Product
Providers, or any of them, for or in respect of the Guaranteed Obligations or
any part thereof, and regardless of whether or not any Person now or hereafter
responsible to the Lender Group, the Bank Product Providers, or any of them, for
the Guaranteed Obligations or any part thereof, whether under this Guaranty or
otherwise, shall cease to be so liable, each Guarantor hereby declares and
agrees that this Guaranty shall be a joint and several obligation, shall be a
continuing guaranty and shall be operative and binding until the later of such
time as indefeasible payment in full in cash of the Guaranteed Obligations
(including (i) either (A) providing cash collateral to be held by Agent in an
amount equal to 105% of the then extant Letter of Credit Usage, or (B) causing
the original Letters of Credit to be returned to Issuing Lender, and (ii)
providing cash collateral (in an amount determined by the applicable Bank
Product Provider as sufficient to satisfy the reasonably estimated credit
exposure) to be held by Agent for the benefit of the Bank Product Providers with
respect to the then extant Bank Products Obligations), termination of the Loan
Agreement and termination of the Commitments, in each case to the reasonable
satisfaction of the Lender Group.
3. Merger. Upon execution of this Guaranty and delivery
thereof to Agent, this Guaranty shall be deemed to be finally executed and
delivered by the Guarantors and shall not be subject to or affected by any
promise or condition affecting or limiting any Guarantor's liability, and no
statement, representation, agreement or promise on the part of the Lender Group,
the Borrowers and the Guarantors, or any of them, or any officer, employee or
agent thereof, unless contained herein, forms any part of this Guaranty or has
induced the making thereof or shall be deemed in any way to affect any
Guarantor's liability hereunder. Each of the Guarantors absolutely,
unconditionally and irrevocably waives any and all right to assert any defense,
set-off, counterclaim or cross-claim of any nature whatsoever with respect to
this Guaranty or the obligations of such Guarantor under this Guaranty or the
obligations of any other Person or party (including, without limitation, the
Borrowers) relating to this Guaranty or the obligations of any of the Guarantors
under this Guaranty or otherwise with respect to the Guaranteed Obligations in
- 2 -
any action or proceeding brought by Agent hereof to collect the Guaranteed
Obligations or any portion thereof or to enforce the obligations of any of the
Guarantors under this Guaranty.
4. Rights of the Lender Group. Agent may from time to
time, without exonerating or releasing any Guarantor in any way under this
Guaranty, (i) take such further or other security or collateral for the
Guaranteed Obligations or any part thereof as it may deem proper, (ii) release,
discharge, abandon or otherwise deal with or fail to deal with any other
Guarantor or other guarantor of the Guaranteed Obligations or any collateral,
security or securities therefor or any part thereof now or hereafter held by
Agent or any other member of the Lender Group, (iii) amend, increase the amount
owing under, modify, extend, accelerate or waive in any manner any of the
provisions, terms, or conditions of the Loan Documents, pursuant to the
provisions of such Loan Documents, or (iv) act or fail to act in any manner
referred to in this Guaranty without regard to whether such action or inaction
may deprive a Guarantor of its right to subrogation against the Borrowers to
recover full indemnity for any payments made pursuant to this Guaranty. Without
limiting the generality of the foregoing, or of Section 5 hereof, it is
understood that Agent may, without exonerating or releasing any Guarantor, give
up, or modify or abstain from perfecting or taking advantage of any security or
Collateral in respect of the Guaranteed Obligations and accept or make any
compositions or arrangements, and realize upon any security for the Guaranteed
Obligations when, and in such manner, and with or without notice, all as such
Person or Persons may deem expedient.
5. Guaranteed Obligations of Each Guarantor Absolute.
Each Guarantor acknowledges and agrees that no change in the nature or terms of
the Guaranteed Obligations or any of the Loan Documents or other agreements,
instruments or contracts evidencing, related to or attendant upon the Guaranteed
Obligations (including any novation) shall discharge all or any part of the
liabilities and obligations of such Guarantor pursuant to this Guaranty, it
being the purpose and intent of each Guarantor and Agent that the covenants,
agreements and all liabilities and obligations of such Guarantor hereunder are
absolute, unconditional and irrevocable under any and all circumstances. Without
limiting the generality of the foregoing, each Guarantor agrees that until all
of the covenants and agreements of this Guaranty are fully performed, and
without possibility of recourse, whether by operation of law or otherwise, such
Guarantor's undertakings hereunder shall not be released, in whole or in part,
by any action or thing that might, but for this paragraph of this Guaranty, be
deemed a legal or equitable discharge of a surety or guarantor, or by reason of
any waiver, omission of Agent or any other member of the Lender Group, or its or
their failure to proceed promptly or otherwise, or by reason of any action taken
or omitted by Agent or any other member of the Lender Group, whether or not such
action or failure to act varies or increases the risk of, or affects the rights
or remedies of, such Guarantor or by reason of any further dealings between the
Borrowers, on the one hand, and Agent or the Lender Group or any member thereof,
on the other hand, or any other guarantor or surety, and such Guarantor hereby
expressly waives and surrenders any defense to its liability hereunder, or any
right of counterclaim or offset of any nature or description that it may have or
may exist based upon, and shall be deemed to have consented to, any of the
foregoing acts, omissions, things, agreements or waivers.
6. Setoff. Subject to Section 16.13 of the Loan
Agreement, the Lender Group or any of them may, without demand or notice of any
kind upon or to any Guarantor, at any time or from time to time when any amount
shall be due and payable hereunder by any
- 3 -
Guarantor, upon the occurrence and during the continuation of an Event of
Default, setoff, appropriate and apply to any portion of the Guaranteed
Obligations hereby guaranteed, and in such order of application as set forth in
the Loan Agreement, any deposits, property, balances, credit accounts or moneys
of any Guarantor in the possession of Agent or any other member of the Lender
Group under their respective control for any purpose. If and to the extent that
any Guarantor makes any payment to Agent or any other Person pursuant to or in
respect of this Guaranty, any claim that such Guarantor may have against any
Borrower by reason thereof shall be subject and subordinate to the prior payment
in full in cash of the Guaranteed Obligations to the reasonable satisfaction of
the Lender Group.
7. Maximum Guaranteed Amount. The creation or existence
from time to time of Guaranteed Obligations in excess of the amount committed to
or outstanding on the date of this Guaranty is hereby authorized, without notice
to any Guarantor, and shall in no way impair or affect this Guaranty or the
rights of Agent or any other member of the Lender Group herein. It is the
intention of each Guarantor and Agent that each Guarantor's obligations
hereunder shall be, but not in excess of, the Maximum Guaranteed Amount (as
herein defined). The "Maximum Guaranteed Amount", with respect to any Guarantor,
shall mean the maximum amount that could be paid out by such Guarantor without
rendering this Guaranty void or voidable as would otherwise be held or
determined by a court of competent jurisdiction in any Insolvency Proceeding
involving any state or any federal bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other similar laws relating to the
insolvency of debtors.
8. Insolvency. Upon the bankruptcy or winding up or
other distribution of assets of any Borrower or any Subsidiary of a Borrower or
of any surety or guarantor (other than a Guarantor) for any Obligations of the
Borrowers to the Lender Group, the rights of any member of the Lender Group
against any Guarantor shall not be affected or impaired by the omission of any
member of the Lender Group to prove its claim, or to prove the full claim, as
appropriate, and Agent may prove such claims as it sees fit and may refrain from
proving any claim and in its discretion may value as it sees fit or refrain from
valuing any security held by it without in any way releasing, reducing or
otherwise affecting the liability to any member of the Lender Group of each of
the Guarantors.
9. Application of Payments. Any amount received by Agent
from whatsoever source and applied toward the payment of the Guaranteed
Obligations shall be applied in such order of application as set forth in the
Loan Agreement.
10. Waiver of Presentment and Demand.
(a) To the extent permitted by applicable law, each
Guarantor hereby absolutely, unconditionally and irrevocably expressly waives
the following: (i) notice of acceptance of this Guaranty; (ii) notice of the
existence or creation of all or any of the Guaranteed Obligations; (iii) notice
of the amount of the Guaranteed Obligations, subject, however, to such
Guarantor's right to make inquiry of Agent to ascertain the amount of the
Guaranteed Obligations at any reasonable time; (iv) notice of any Event of
Default under the Loan Agreement or the other Loan Documents; (v) presentment,
demand, notice of dishonor, protest, and all other notices whatsoever; (vi) all
diligence in collection or protection of or realization upon the Guaranteed
Obligations or any part thereof, any obligation hereunder, or any
- 4 -
security for any of the foregoing; (vii) until indefeasible payment in full in
cash of the Guaranteed Obligations (including (A) either (1) providing cash
collateral to be held by Agent in an amount equal to 105% of the then extant
Letter of Credit Usage, or (2) causing the original Letters of Credit to be
returned to Issuing Lender, and (B) providing cash collateral (in an amount
determined by the applicable Bank Product Provider as sufficient to satisfy the
reasonably estimated credit exposure) to be held by Agent for the benefit of the
Bank Product Providers with respect to the then extant Bank Products
Obligations), termination of the Loan Agreement and termination of the
Commitments, in each case to the reasonable satisfaction of the Lender Group,
and termination of this Guaranty, all rights to enforce any remedy that Agent or
any other member of the Lender Group may have against the Borrowers; and (viii)
any benefit of, or right to participate in, any collateral or security now or
hereinafter held by Agent or any other member of the Lender Group in respect of
the Guaranteed Obligations. If a claim is ever made upon Agent or any other
member of the Lender Group for the repayment or recovery of any amount or
amounts received by such Person in payment of any of the Guaranteed Obligations
and such Person repays all or part of such amount by reason of (i) any judgment,
decree or order of any court or administrative body having jurisdiction over
such Person or any of its property, or (ii) any settlement or compromise of any
such claim effected by such Person with any such claimant, including any
Borrower, then in such event each Guarantor agrees that any such judgment,
decree, order, settlement or compromise shall be binding upon such Guarantor,
notwithstanding any revocation hereof or the cancellation of any promissory note
or other instrument evidencing any of the Guaranteed Obligations, and such
Guarantor shall be and remain obligated to such Person hereunder for the amount
so repaid or recovered to the same extent as if such amount had never originally
been received by such Person.
(b) To the fullest extent permitted by applicable law,
each Guarantor hereby waives (i) the right by statute or otherwise to require
Agent or any other member of the Lender Group to institute suit against any
Borrower or any other Person or to exhaust any rights and remedies that Agent or
any other member of the Lender Group has or may have against any Borrower or any
other Person and (ii) any defense arising by reason of any disability or other
defense (other than the defense that the Guaranteed Obligations shall have been
indefeasibly paid in full in cash and the Commitments have been terminated) of
any Borrower or any other Person or by reason of the cessation from any cause
(other than that the Guaranteed Obligations shall have been indefeasibly paid in
full in cash and the Commitments have been terminated) whatsoever of the
liability of any Borrower or any other Person in respect thereof.
(c) No Guarantor shall be released or discharged, either
in whole or in part, by Agent's or any other member of the Lender Group's
failure or delay to (i) perfect or continue the perfection of any lien or
security interest in any collateral that secures the Guaranteed Obligations or
any other obligations of the Borrowers, any Guarantor or any other Person, or
(ii) protect the property covered by such lien or security interest.
(d) To the fullest extent permitted by applicable law,
each Guarantor hereby waives: (i) any rights to assert against Agent or any
other member of the Lender Group any defense (legal or equitable), set-off,
counterclaim, or claim that such Guarantor may now or at any time hereafter have
against any Borrower or any other Person liable to Agent and any other member of
the Lender Group on account of or with respect to the Guaranteed Obligations
(other than the defense that the Guaranteed Obligations shall have been
indefeasibly paid in full in cash
- 5 -
and the Commitments have been terminated); (ii) any defense, set-off,
counterclaim, or claim, of any kind or nature, arising directly or indirectly
from the present or future sufficiency, validity, or enforceability of the
Guaranteed Obligations (other than the defense that the Guaranteed Obligations
shall have been indefeasibly paid in full in cash and the Commitments have been
terminated); (iii) any defense arising by reason of any claim or defense based
upon an election of remedies by Agent or any other member of the Lender Group;
and (iv) the benefit of any statute of limitations affecting such Guarantor's
liability hereunder or the enforcement thereof.
(e) To the fullest extent permitted by applicable law,
each Guarantor hereby waives, until indefeasible payment in full in cash of the
Guaranteed Obligations (including (i) either (A) providing cash collateral to be
held by Agent in an amount equal to 105% of the then extant Letter of Credit
Usage, or (B) causing the original Letters of Credit to be returned to Issuing
Lender, and (ii) providing cash collateral (in an amount determined by the
applicable Bank Product Provider as sufficient to satisfy the reasonably
estimated credit exposure) to be held by Agent for the benefit of the Bank
Product Providers with respect to the then extant Bank Products Obligations),
termination of the Loan Agreement and termination of the Commitments, in each
case to the reasonable satisfaction of the Lender Group, and termination of this
Guaranty, any right of subrogation such Guarantor has or may have as against any
Borrower or any other Person with respect to the Guaranteed Obligations. In
addition, each Guarantor hereby subordinates and postpones, until indefeasible
payment in full in cash of the Guaranteed Obligations (including (i) either (A)
providing cash collateral to be held by Agent in an amount equal to 105% of the
then extant Letter of Credit Usage, or (B) causing the original Letters of
Credit to be returned to Issuing Lender, and (ii) providing cash collateral (in
an amount determined by the applicable Bank Product Provider as sufficient to
satisfy the reasonably estimated credit exposure) to be held by Agent for the
benefit of the Bank Product Providers with respect to the then extant Bank
Products Obligations), termination of the Loan Agreement and termination of the
Commitments, in each case to the reasonable satisfaction of the Lender Group,
and termination of this Guaranty, any right to proceed against any Borrower or
any other Person, now or hereafter arising, for contribution, indemnity,
reimbursement, or any other suretyship rights and claims (irrespective of
whether direct or indirect, liquidated or contingent) with respect to the
Guaranteed Obligations. Each Guarantor also hereby waives any right to proceed
or to seek recourse against or with respect to any property or asset of any
Borrower or any other Person. Each Guarantor hereby agrees that, in light of the
waivers contained in this Section 10, such Guarantor shall not be deemed to be a
"creditor" (as that term is defined in Title 11 of the United States Code, as in
effect from time to time (the "Bankruptcy Code") or otherwise) of any Borrower
or any other Person, whether for purposes of the application of Sections 547 or
550 of the Bankruptcy Code or otherwise.
(f) Each Guarantor hereby waives any rights and defenses
such Guarantor may have if all or part of the Guaranteed Obligations are secured
by real property. These rights and defenses are based upon Section 580a, 580b,
580d, or 726 of the California Code of Civil Procedure, the Nevada one action
rule NRS 40.430 or any similar laws of New York or any other jurisdiction.
(g) WITHOUT LIMITING THE GENERALITY OF ANY OTHER WAIVER
OR OTHER PROVISION SET FORTH IN THIS GUARANTY, EACH GUARANTOR HEREBY WAIVES, TO
THE MAXIMUM EXTENT SUCH WAIVER IS
- 6 -
PERMITTED BY LAW, ANY AND ALL BENEFITS OR DEFENSES ARISING DIRECTLY OR
INDIRECTLY UNDER ANY ONE OR MORE OF CALIFORNIA CIVIL CODE SECTIONS 2787 THROUGH
AND INCLUDING SECTION 2855, CALIFORNIA CODE OF CIVIL PROCEDURE SECTIONS 580a,
580b, 580c, 580d, AND 726, AND CHAPTER 2 OF TITLE 14 OF THE CALIFORNIA CIVIL
CODE OR ANY SIMILAR LAWS OF NEW YORK OR ANY OTHER JURISDICTION.
(h) WITHOUT LIMITING THE GENERALITY OF ANY OTHER WAIVER
OR OTHER PROVISION SET FORTH IN THIS GUARANTY, EACH GUARANTOR WAIVES ALL RIGHTS
AND DEFENSES ARISING OUT OF AN ELECTION OF REMEDIES BY AGENT, EVEN THOUGH THAT
ELECTION OF REMEDIES, SUCH AS A NONJUDICIAL FORECLOSURE WITH RESPECT TO SECURITY
FOR A GUARANTEED OBLIGATION, HAS DESTROYED SUCH GUARANTOR'S RIGHTS OF
SUBROGATION AND REIMBURSEMENT AGAINST ANY BORROWER BY THE OPERATION OF SECTION
580d OF THE CALIFORNIA CODE OF CIVIL PROCEDURE OR ANY SIMILAR LAWS OF NEW YORK
OR ANY OTHER JURISDICTION OR OTHERWISE.
(i) Without affecting the generality of this Section,
each Guarantor hereby also agrees to the following waivers:
(i) such Guarantor agrees that Agent's right to
enforce this Guaranty is absolute and is not contingent upon the genuineness,
validity or enforceability of any of the Loan Documents. Such Guarantor waives
all benefits and defenses it may have under California Civil Code Section 2810
or any similar laws of New York or any other jurisdiction and agrees that
Agent's rights under this Guaranty shall be enforceable even if no Borrower had
any liability at the time of execution of the Loan Documents or later ceases to
be liable;
(ii) such Guarantor waives all benefits and
defenses it may have under California Civil Code Section 2809 or any similar
laws of New York or any other jurisdiction with respect to its obligations under
this Guaranty and agrees that Agent's rights under the Loan Documents will
remain enforceable even if the amount secured by the Loan Documents is larger in
amount and more burdensome than that for which Borrowers are responsible. The
enforceability of this Guaranty against such Guarantor shall continue until all
sums due under the Loan Documents have been paid in full and shall not be
limited or affected in any way by any impairment or any diminution or loss of
value of any security or collateral for any Borrower's obligations under the
Loan Documents, from whatever cause, the failure of any security interest in any
such security or collateral or any disability or other defense of any Borrower,
any other guarantor of any Borrower's obligations under the Loan Documents, any
pledgor of collateral for any Person's obligations to Lender or any other Person
in connection with the Loan Documents; and
(iii) such Guarantor waives all benefits and
defenses it may have under California Civil Code Sections 2845, 2849 and 2850 or
any similar laws of New York or any other jurisdiction with respect to its
obligations under this Guaranty, including the right to require Agent to (A)
proceed against any Borrower, any guarantor of any Borrower's obligations under
the Loan Documents, any other pledgor of collateral for any Person's obligations
to any
- 7 -
member of the Lender Group or any other Person in connection with the Guaranteed
Obligations, (B) proceed against or exhaust any other security or collateral
Agent or any other member of the Lender Group may hold, or (C) pursue any other
right or remedy for such Guarantor's benefit, and agrees that Agent may exercise
its rights under this Guaranty without taking any action against any Borrower,
any other guarantor of any Borrower's obligations under the Loan Documents, any
pledgor of collateral for any Person's obligations to any member of the Lender
Group or any other Person in connection with the Guaranteed Obligations, and
without proceeding against or exhausting any security or collateral Lender
holds.
(j) The paragraphs in this Section 10 which refer to
certain sections of the California Civil Code are included in this Guaranty
solely out of an abundance of caution and shall not be construed to mean that
any of the above-referenced provisions of California law are in any way
applicable to this Guaranty.
11. Continuing Guaranty. This Guaranty is a continuing
guaranty of the Guaranteed Obligations and all liabilities to which it applies
or may apply under the terms hereof and shall be conclusively presumed to have
been created in reliance hereon. No failure or delay by Agent or any other
member of the Lender Group in the exercise of any right, power, privilege or
remedy shall operate as a waiver thereof, and no single or partial exercise by
Agent or any other member of the Lender Group of any right or remedy shall
preclude other or further exercise thereof or the exercise of any other right or
remedy and no course of dealing between any Guarantor, Agent or any other member
of the Lender Group shall operate as a waiver thereof. The obligations of each
Guarantor hereunder shall remain in full force and effect without regard to, and
shall not be affected or impaired by the following, any of which may be taken
without the consent of, or notice to, such Guarantor, nor shall any of the
following give such Guarantor any recourse or right of action against Agent or
any other member of the Lender Group:
(a) Any Insolvency Proceeding relating to such Guarantor
or any Borrower, any Affiliate of any Borrower or any other Person, or any
action taken with respect to this Guaranty by any trustee or receiver, or by any
court, in any such proceeding, regardless of whether such Guarantor shall have
had notice or knowledge of any of the foregoing;
(b) Any release or discharge of any Borrower from its
liability under any of the Loan Documents or any release or discharge of any
endorser or guarantor or of any other Person at any time directly or
contingently liable for the Guaranteed Obligations;
(c) Any subordination, compromise, release (by operation
of law or otherwise), discharge, compound, collection or liquidation of any or
all of the Collateral or other property described in any of the Loan Documents
or otherwise in any manner, or any substitution with respect thereto; and
(d) Any acceptance of partial performance of the
Guaranteed Obligations.
No action by Agent or any other member of the Lender Group permitted
hereunder shall in any way impair or affect this Guaranty. For the purpose of
this Guaranty, the Guaranteed Obligations shall include, without limitation, all
Obligations of the Borrowers to Agent and the other members of the Lender Group
and the Bank Product Providers, notwithstanding any right
- 8 -
or power of any third party, individually or in the name of the Borrowers, the
Lender Group and the Bank Product Providers, or any of them, to assert any claim
or defense as to the invalidity or unenforceability of any such Obligation, and
no such claim or defense shall impair or affect the obligations of any Guarantor
hereunder.
12. Successors and Assigns.
(a) This Guaranty shall bind and inure to the benefit of
the respective successors and assigns of each of the parties hereto, including,
without limitation, any receiver or trustee of a Guarantor; provided, however,
that no Guarantor may assign this Guaranty or any rights or duties hereunder
without Agent's prior written consent, except as otherwise permitted by Section
7.3 of the Loan Agreement, and any prohibited assignment shall be absolutely
void ab initio. No consent to assignment by Agent shall release any Guarantor
from its obligations to the Lender Group and the Bank Product Providers.
(b) Agent and the other members of the Lender Group may,
to the extent permitted under the Loan Agreement or any other Loan Documents,
and pursuant to the notice provisions thereunder, sell, assign or transfer all
or any part of the Guaranteed Obligations, and in such event each and every
permitted assignee, transferee, or holder of all or any of the Guaranteed
Obligations shall have the right to enforce this Guaranty, by suit or otherwise,
for the benefit of such permitted assignee, transferee or holder as fully as if
such assignee, transferee or holder were herein by name specifically given such
rights, powers and benefits. In the event this Guaranty or the rights hereunder
are so assigned by Agent, the term "Agent", wherever used herein, shall be
deemed to refer to and include any such assignee.
13. Collection Costs and Fees; Notices. This is a
guaranty of payment and not of collection. In the event Agent makes a demand
upon any Guarantor in accordance with the terms of this Guaranty, such Guarantor
shall be held and bound to Agent directly as debtor in respect of the payment of
the amounts hereby guaranteed. The Guarantors shall be jointly and severally
liable for the payment and performance of their obligations hereunder. All costs
and expenses, including, without limitation, reasonable attorneys' fees and
expenses, incurred by Agent in obtaining performance of or collecting payments
due under this Guaranty shall be deemed part of the Guaranteed Obligations
guaranteed hereby. Any notice, demand or other communication that Agent may wish
to give shall be served upon any Guarantor in the fashion prescribed for notices
in the Loan Agreement at the address for such Guarantor given on Exhibit A
attached hereto and the notice so sent shall be deemed to be served as set forth
in the Loan Agreement. All notices or other communication to Agent shall be
served upon Agent at its address set forth in Section 12 of the Loan Agreement
and in the fashion prescribed thereunder.
14. Direct Benefit to Guarantors. Each Guarantor
expressly represents and acknowledges that the loans and any other financial
accommodations by the Lender Group to the Borrowers are and will be of direct
interest, benefit and advantage to such Guarantor.
15. Agent's Right to Inspect. Each Guarantor covenants
and agrees that such Guarantor shall permit, as provided and in the manner
described in the Loan Agreement with respect to Borrowers, representatives of
Agent to visit and inspect properties of such Guarantor, inspect such
Guarantor's books and records and discuss with the principal officers of such
- 9 -
Guarantor its businesses, assets, liabilities, financial position, results of
operations and business prospects.
16. Representations and Warranties; Covenants.
(a) Each Guarantor hereby represents and warrants to
Agent and the other members of the Lender Group that this Guaranty has been duly
executed and delivered by such Guarantor and constitutes its legal, valid and
binding obligation.
(b) Each Guarantor hereby represents and warrants that
(a) such Guarantor and each Subsidiary of such Guarantor is Solvent and (b) no
transfer of property is being made by such Guarantor or any Subsidiary of such
Guarantor and no obligation is being incurred by such Guarantor or any
Subsidiary of such Guarantor in connection with the transactions contemplated by
this Guaranty or the other Loan Documents with the intent to hinder, delay or
defraud either present or future creditors of such Guarantor or the Subsidiaries
of such Guarantor.
(c) Each Guarantor hereby represents and warrants that
the Reservation Management System is owned by A&M Associates, Inc., a Nevada
corporation, free and clear of liens and encumbrances.
(d) Each Guarantor agrees that, for purposes of this
Guaranty, all of the representations, warranties and covenants made by Borrowers
on behalf of or relating to each "Subsidiary" or any "Guarantor" in the Loan
Agreement shall be deemed incorporated by reference into and made an express
part of this Guaranty, as fully and completely as if set forth expressly herein,
and such Guarantor shall comply herewith and be bound thereby. Each Guarantor
ratifies and affirms each representation and warranty made with respect to it or
on its behalf by any Borrower in the Loan Agreement.
17. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.
(a) THE VALIDITY OF THIS GUARANTY AND THE OTHER LOAN
DOCUMENTS TO WHICH EACH GUARANTOR IS A PARTY, THE CONSTRUCTION, INTERPRETATION,
AND ENFORCEMENT HEREOF AND THEREOF, AND THE RIGHTS OF THE PARTIES HERETO AND
THERETO AND THE BENEFICIARIES HEREOF AND THEREOF WITH RESPECT TO ALL MATTERS
ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR THERETO SHALL BE DETERMINED
UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK.
(b) EACH GUARANTOR AGREES THAT ALL ACTIONS OR PROCEEDINGS
ARISING IN CONNECTION WITH THIS GUARANTY AND THE OTHER LOAN DOCUMENTS TO WHICH
SUCH GUARANTOR IS A PARTY SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND
FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK, EXCEPT TO
THE EXTENT THE BANKRUPTCY COURT RETAINS JURISDICTION WITH RESPECT TO THE
REORGANIZATION PLAN; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT
AGAINST ANY COLLATERAL OR OTHER
- 10 -
PROPERTY MAY BE BROUGHT, AT AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION
WHERE AGENT ELECTS TO BRING SUCH ACTION OR WHERE SUCH COLLATERAL OR OTHER
PROPERTY MAY BE FOUND. EACH GUARANTOR WAIVES, TO THE EXTENT PERMITTED UNDER
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON
CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN
ACCORDANCE WITH THIS SECTION 17.
(c) EACH GUARANTOR HEREBY WAIVES ITS RESPECTIVE RIGHTS TO
A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF
THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING
CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR
STATUTORY CLAIMS. EACH GUARANTOR REPRESENTS THAT IT HAS REVIEWED THIS WAIVER AND
EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS
GUARANTY MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
18. Modification. Neither this Guaranty nor any of its
terms, provisions or conditions may be altered, amended or modified in any way,
except as specifically provided in a written instrument signed by an authorized
officer of Agent and the Guarantors.
19. Cumulative Remedies. Agent's and each other member of
the Lender Group's rights under this Guaranty and the other Loan Documents will
be cumulative and not exclusive of any other right or remedy that Agent or any
other member of the Lender Group may have.
20. Agent. Each reference herein to any right granted to,
benefit conferred upon or power exercisable by the "Agent" shall be a reference
to Agent for itself and for the other members of the Lender Group, and each
action taken or right exercised hereunder shall be deemed to have been so taken
or exercised by Agent for the benefit of and on behalf of the Lender Group.
21. New Subsidiaries. Any new Subsidiary (whether by
acquisition or creation) of a Borrower is required to enter into this Guaranty
by executing and delivering to Agent an instrument in the form of Annex 1
attached hereto. Upon the execution and delivery of Annex 1 by such new
Subsidiary, such Subsidiary shall become a Guarantor hereunder with the same
force and effect as if originally named as a Guarantor herein. The execution and
delivery of any instrument adding an additional Guarantor as a party to this
Guaranty shall not require the consent of any Guarantor hereunder. The rights
and obligations of each Guarantor hereunder shall remain in full force and
effect notwithstanding the addition of any new Guarantor hereunder.
22. Term. Upon indefeasible payment in full in cash of
the Guaranteed Obligations (including (a) either (i) providing cash collateral
to be held by Agent in an amount equal to 105% of the then extant Letter of
Credit Usage, or (ii) causing the original Letters of
- 11 -
Credit to be returned to Issuing Lender, and (b) providing cash collateral (in
an amount determined by the applicable Bank Product Provider as sufficient to
satisfy the reasonably estimated credit exposure) to be held by Agent for the
benefit of the Bank Product Providers with respect to the then extant Bank
Products Obligations), termination of the Loan Agreement and termination of the
Commitments, in each case to the satisfaction of the Lender Group, this Guaranty
shall terminate and Agent shall take all action reasonably requested by any
Guarantor (at the expense of the Borrowers or such Guarantor) to evidence the
termination of this Guaranty.
23. Severability of Provisions. Each provision of this
Guaranty shall be severable from every other provision of this Guaranty for the
purpose of determining the legal enforceability of any specific provision.
24. Counterparts; Telefacsimile Execution. This Guaranty
may be executed in any number of counterparts and by different parties on
separate counterparts, each of which, when executed and delivered, shall be
deemed to be an original, and all of which, when taken together, shall
constitute but one and the same agreement. Delivery of an executed counterpart
of this Guaranty by telefacsimile shall be equally as effective as delivery of
an original executed counterpart of this Guaranty.
25. Survival of Provisions. All representations,
warranties and covenants of each Guarantor contained herein shall survive the
execution and delivery of this Guaranty.
26. Integration. This Guaranty, together with the other
Loan Documents, reflects the entire understanding of the parties with respect to
the transactions contemplated hereby and shall not be contradicted or qualified
by any other agreement, oral or written, before the date hereof.
27. Section Headings. Headings and numbers have been set
forth herein for convenience only. Unless the contrary is compelled by the
context, everything contained in each Section applies equally to this entire
Guaranty.
28. Voided Payments. Notwithstanding anything herein to
the contrary, to the extent that any Guarantor or any other party makes any
payment on the Guaranteed Obligations that is subsequently invalidated, declared
to be fraudulent, avoidable or preferential, set aside or is required to be
repaid to a trustee, receiver, the estate of such Guarantor or any other party
under any bankruptcy act, state or Federal law, common law or equitable cause
(such payment being hereinafter referred to as a "Voided Payment"), then to the
extent of such Voided Payment that portion of the Guaranteed Obligations that
had been previously satisfied by such Voided Payment shall be revived and
continue in full force and effect as if such Voided Payment had never been made.
In the event that a Voided Payment is sought to be recovered from Agent or any
other member of the Lender Group, an "Event of Default" under the Loan Agreement
shall be deemed to have occurred and to be continuing from the date of such
recovery from Agent or such other member of the Lender Group of such Voided
Payment until the full amount of such Voided Payment is fully and finally
restored to Agent or such other member of the Lender Group and until such time
the provisions of this Guaranty, and the guaranty provided herein, shall be in
full force and effect.
- 12 -
IN WITNESS WHEREOF, the parties hereto have executed this Guaranty as
of the date first above written.
GUARANTORS:
AMERCO REAL ESTATE SERVICES,
INC., a Nevada corporation
TWO PAC COMPANY, a Nevada corporation
THREE PAC COMPANY, a Nevada
corporation
FOUR PAC COMPANY, a Nevada
corporation
SIX PAC COMPANY, a Nevada
corporation
EIGHT PAC COMPANY, a Nevada
corporation
NINE PAC COMPANY, a Nevada
corporation
ELEVEN PAC COMPANY, a Nevada
corporation
TWELVE PAC COMPANY, a Nevada
corporation
FIFTEEN PAC COMPANY, a Nevada
corporation
SEVENTEEN PAC COMPANY, a Nevada
corporation
NATIONWIDE COMMERCIAL CO., an
Arizona corporation
PF&F HOLDINGS CORPORATION, a
Delaware corporation
By: /s/ Xxxxxx Xxxxxxxx
___________________________
Xxxxxx Xxxxxxxx, President
SIGNATURE PAGE
GUARANTY
EMOVE, INC., a Nevada corporation
WEB TEAM ASSOCIATES, INC., a
Nevada corporation
By: /s/ Xxxxxx Xxxxxxxx
___________________________
Xxxxxx Xxxxxxxx, Secretary
SIGNATURE PAGE
GUARANTY
A & M ASSOCIATES, INC., an Arizona
corporation
U-HAUL SELF-STORAGE
CORPORATION, a Nevada corporation
U-HAUL SELF-STORAGE MANAGEMENT (WPC),
INC., a Nevada corporation
U-HAUL BUSINESS CONSULTANTS,
INC., an Arizona corporation
U-HAUL LEASING & SALES CO., a
Nevada corporation
U-HAUL CO. OF ALABAMA, INC., an
Alabama corporation
U-HAUL CO. OF ARKANSAS, a Arkansas
corporation
U-HAUL CO. OF CALIFORNIA, a
California corporation
U-HAUL CO. OF COLORADO, a
Colorado corporation
U-HAUL CO. OF CONNECTICUT, a
Connecticut corporation
U-HAUL CO. OF DISTRICT OF COLUMBIA,
INC., a District of Columbia
corporation
U-HAUL CO. OF GEORGIA, a Georgia
corporation
U-HAUL CO. OF IDAHO, INC., an
Idaho corporation
U-HAUL CO. OF IOWA, INC., an Iowa
corporation
U-HAUL CO. OF ILLINOIS, INC., an
Illinois corporation
U-HAUL CO. OF INDIANA, INC., an
Indiana corporation
U-HAUL CO. OF KANSAS, INC., a
Kansas corporation
U-HAUL CO. OF KENTUCKY, a Kentucky
corporation
SIGNATURE PAGE
GUARANTY
U-HAUL CO. OF LOUISIANA, a
Louisiana corporation
U-HAUL CO. OF MASSACHUSETTS
AND OHIO, INC., a Massachusetts
corporation
U-HAUL CO. OF MARYLAND, INC., a
Maryland corporation
U-HAUL CO. OF MAINE, INC., a Maine
corporation
U-HAUL CO. OF MICHIGAN, a Michigan
corporation
U-HAUL CO. OF MINNESOTA, a
Minnesota corporation
U-HAUL COMPANY OF MISSOURI, a
Missouri corporation
U-HAUL CO. OF MISSISSIPPI, a
Mississippi Corporation
U-HAUL CO. OF MONTANA, INC., a
Montana corporation
U-HAUL CO. OF NORTH CAROLINA,
a North Carolina corporation
U-HAUL CO. OF NORTH DAKOTA, a
North Dakota corporation
U-HAUL CO. OF NEBRASKA, a Nebraska
corporation
U-HAUL CO. OF NEVADA, INC., a
Nevada corporation
U-HAUL CO. OF NEW HAMPSHIRE,
INC., a New Hampshire corporation
U-HAUL CO. OF NEW JERSEY, INC.,
a New Jersey corporation
U-HAUL CO. OF NEW MEXICO, INC.,
a New Mexico corporation
U-HAUL CO. OF NEW YORK, INC., a
New York corporation
U-HAUL CO. OF OKLAHOMA, INC.,
an Oklahoma corporation
SIGNATURE PAGE
GUARANTY
U-HAUL CO. OF OREGON, an Oregon
corporation
U-HAUL CO. OF PENNSYLVANIA, a
Pennsylvania corporation
U-HAUL CO. OF RHODE ISLAND, a
Rhode Island corporation
U-HAUL CO. OF SOUTH CAROLINA,
INC., a South Carolina
corporation
U-HAUL CO. OF SOUTH DAKOTA,
INC., a South Dakota
corporation
U-HAUL CO. OF TENNESSEE, a
Tennessee corporation
U-HAUL CO. OF TEXAS, a Texas
corporation
U-HAUL CO. OF UTAH, INC., a Utah
corporation
U-HAUL CO. OF VIRGINIA, a Virginia
corporation
U-HAUL CO. OF WASHINGTON, a
Washington corporation
U-HAUL CO. OF WISCONSIN, INC., a
Wisconsin corporation
U-HAUL CO. OF WEST VIRGINIA, a
West Virginia corporation
U-HAUL CO. OF WYOMING, INC., a
Wyoming corporation
By: /s/ Xxxx X. Xxxxxxxxxxx
_____________________________
Xxxx X. Xxxxxxxxxxx, Secretary
SIGNATURE PAGE
GUARANTY
Accepted as of the date first above written:
XXXXX FARGO FOOTHILL, INC.,
as Agent
By: /s/ Xxxxxx X. Xxxxx
______________________________
Its: Senior Vice President
_____________________________
SIGNATURE PAGE
GUARANTY
EXHIBIT A - GUARANTOR ADDRESSES FOR NOTICE
[Guarantor]
c/o AMERCO
0000 Xxxxxxxxx Xxx, Xxxxx 000
Xxxx, Xxxxxx 00000-0000
Attn: Assistant Treasurer
Fax No. 000.000.0000
with copies to:
U-HAUL INTERNATIONAL, INC.
0000 Xxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx 00000
Attn: General Counsel
Fax No. 000.000.0000
and:
SQUIRE, XXXXXXX & XXXXXXX, L.L.P.
Two Renaissance Square
00 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxxxxxx X. Xxxxxxx, Esq.
Fax No. 000.000.0000
ANNEX 1
to
GUARANTY
FORM OF SUPPLEMENT
THIS SUPPLEMENT NO. __ (this "Supplement") dated as of __________ to
the Guaranty dated as of March 1, 2004 (as amended, restated, supplemented or
otherwise modified from time to time, the "Guaranty"), by each of the parties
listed on the signature pages thereto and those additional entities that
thereafter become parties thereto (each a "Guarantor" and collectively, the
"Guarantors") and Xxxxx Fargo Foothill, Inc., a California corporation, as Agent
for the Lenders (as defined below) ("Agent").
WITNESSETH:
WHEREAS, pursuant to that certain Loan and Security Agreement dated as
of March 1, 2004 (as the same may be amended, restated, supplemented or
otherwise modified from time to time, the "Loan Agreement"), among Agent, the
lenders from time to time party thereto (the "Lenders") and AMERCO, a Nevada
corporation, and each of its subsidiaries signatory thereto, as borrowers (each,
a "Borrower" and collectively, the "Borrowers"), the Lenders have agreed to make
Advances (as defined in the Loan Agreement), issue Letters of Credit (as defined
in the Loan Agreement) and make other extensions of credit to the Borrowers from
time to time pursuant to the terms and conditions thereof
WHEREAS, capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned to such terms in the Guaranty, and if not
defined therein, in the Loan Agreement; and
WHEREAS, the Guarantors have entered into the Guaranty in order to
induce the Lenders to make the Loans and other financial accommodations
contained in the Loan Agreement; and
WHEREAS, pursuant to Section 21 of the Guaranty, each new Subsidiary of
a Borrower or a Guarantor (whether by acquisition or creation) must execute and
deliver the Guaranty, and the execution of the Guaranty by the undersigned new
Guarantor or Guarantors (collectively, the "New Guarantor") may be accomplished
by the execution of this Supplement in favor of Agent; and
WHEREAS, New Guarantor is a direct or indirect Subsidiary of a Borrower
or a Guarantor, and New Guarantor has determined that it will realize
substantial direct and indirect benefits as a result of the loans and other
financial accommodations extended to the Borrowers pursuant to the Loan
Agreement, and New Guarantor's execution, delivery and performance of this
Guaranty is within New Guarantor's corporate or other purposes;
NOW, THEREFORE, for and in consideration of the foregoing and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the New Guarantor hereby agrees as follows:
SECTION 1. In accordance with Section 21 of the Guaranty, the New
Guarantor, by its signature below, becomes a "Guarantor" under the Guaranty with
the same force and effect as if originally named therein as a "Guarantor" and
the New Guarantor hereby (a) agrees to all of the terms and provisions of the
Guaranty applicable to it as a "Guarantor" thereunder and (b) represents and
warrants that the representations and warranties made by it as a "Guarantor"
thereunder are true and correct on and as of the date hereof. In furtherance of
the foregoing, the New Guarantor, as security for the payment and performance in
full in cash of the Guaranteed Obligations, does hereby guarantee, subject to
the limitations set forth in Section 7 of the Guaranty, to Agent, the full and
prompt payment of the Guaranteed Obligations, including, without limitation, any
interest thereon, plus reasonable attorneys' fees and expenses if the Guaranteed
Obligations represented by the Guaranty are collected by law, through an
attorney-at-law, or under advice therefrom. Each reference to a "Guarantor" in
the Guaranty shall be deemed to include the New Guarantor. The Guaranty is
incorporated herein by reference.
SECTION 2. The New Guarantor represents and warrants to Agent that this
Supplement has been duly executed and delivered by the New Guarantor and
constitutes its legal, valid and binding obligation, enforceable against it in
accordance with its terms, except as enforceability thereof may be limited by
bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium or other
similar laws affecting creditors' rights generally and general principles of
equity (regardless of whether such enforceability is considered in a proceeding
at law or in equity).
SECTION 3. This Supplement may be executed in multiple counterparts,
each of which shall be deemed to be an original, but all such separate
counterparts shall together constitute but one and the same instrument. Delivery
of a counterpart hereof via facsimile transmission shall be as effective as
delivery of a manually executed counterpart hereof.
SECTION 4. Except as expressly supplemented hereby, the Guaranty shall
remain in full force and effect.
SECTION 5. This Supplement shall be construed and enforced and the
rights and duties of the parties shall be governed by in all respects in
accordance with the laws and decisions of the State of New York without
reference to the conflicts or choice of law principles thereof.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the New Guarantor has duly executed this Supplement
to the Guaranty as of the day and year first above written.
NEW GUARANTOR: [Name of New Guarantor]
Address: _________________________ By: ______________________________
_________________________ Name: ____________________________
_________________________ Title: ___________________________
