Exhibit 4.31
AVIS RENT A CAR, INC.
$500,000,000
11% Senior Subordinated Notes due 2009
EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
June 30, 1999
CHASE SECURITIES INC.
XXXXXX BROTHERS INC.
c/o Chase Securities Inc.
000 Xxxx Xxxxxx, 0xx xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Avis Rent A Car, Inc., a Delaware corporation (the "Company"),
proposes to issue and sell, the Subsidiary Guarantors named in Schedule 1 hereto
(the "Subsidiary Guarantors") propose to guarantee, and Chase Securities Inc.
("CSI") and Xxxxxx Brothers Inc. (together with CSI, the "Initial Purchasers")
propose to buy, upon the terms and subject to the conditions set forth in a
purchase agreement dated June 25, 1999 (the "Purchase Agreement"), $500,000,000
aggregate principal amount of the Company's 11% Senior Subordinated Notes due
2009 (the "Securities"). Capitalized terms used but not defined herein shall
have the meanings given to such terms in the Purchase Agreement.
As an inducement to the Initial Purchasers to enter into the
Purchase Agreement and in satisfaction of a condition to the obligations of the
Initial Purchasers thereunder, the Company and the Subsidiary Guarantors agree
with the Initial Purchasers, for the benefit of the holders (including the
Initial Purchasers) of the Securities, the Exchange Securities (as defined
herein) and the Private Exchange Securities (as defined herein) (collectively,
the "Holders"), as follows:
1. Registered Exchange Offer. The Company and the Subsidiary
Guarantors shall (i) prepare and, not later than 90 days following the date of
original issuance of the Securities (the "Issue Date"), file with the Commission
a registration statement (the "Exchange Offer Registration Statement") on an
appropriate form under the Securities Act with respect to a proposed offer to
the Holders of the Securities (the "Registered Exchange Offer") to issue and
deliver to such Holders, in exchange for the Securities, a like aggregate
principal amount of debt securities of the Company (the "Exchange Securities")
that are identical in all material respects to the Securities, except for the
transfer restrictions relating to the Securities, (ii) use their
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respective reasonable best efforts to cause the Exchange Offer Registration
Statement to become effective under the Securities Act no later than 150 days
after the Issue Date and the Registered Exchange Offer to be consummated no
later than 180 days after the Issue Date and (iii) keep the Exchange Offer
Registration Statement effective for not less than 20 days (or longer, if
required by applicable law) after the date on which notice of the Registered
Exchange Offer is mailed to the Holders (such period being called the "Exchange
Offer Registration Period"). The Exchange Securities will be issued under the
Indenture or an indenture (the "Exchange Securities Indenture") between the
Company, the Subsidiary Guarantors and the Trustee or such other bank or trust
company that is reasonably satisfactory to the Initial Purchasers, as trustee
(the "Exchange Securities Trustee"), such indenture to be identical in all
material respects to the Indenture, except for the transfer restrictions
relating to the Securities (as described above).
Upon the effectiveness of the Exchange Offer Registration Statement,
the Company and the Subsidiary Guarantors shall promptly commence the Registered
Exchange Offer, it being the objective of such Registered Exchange Offer to
enable each Holder electing to exchange Securities for Exchange Securities
(assuming that such Holder (a) is not an affiliate of the Company or an
Exchanging Dealer (as defined herein) not complying with the requirements of the
next sentence, (b) acquires the Exchange Securities in the ordinary course of
such Holder's business and (c) has no arrangements or understandings with any
person to participate in the distribution of the Exchange Securities) and to
trade such Exchange Securities from and after their receipt without any
limitations or restrictions under the Securities Act and without material
restrictions under the securities laws of the several states of the United
States. The Company, the Subsidiary Guarantors, the Initial Purchasers and each
Exchanging Dealer acknowledge that, pursuant to current interpretations by the
Commission's staff of Section 5 of the Securities Act, each Holder that is a
broker-dealer electing to exchange Securities, acquired for its own account as a
result of market-making activities or other trading activities, for Exchange
Securities (an "Exchanging Dealer"), is required to deliver a prospectus
containing substantially the information set forth in Annex A hereto on the
cover, in Annex B hereto in the "Exchange Offer Procedures" section and the
"Purpose of the Exchange Offer" section and in Annex C hereto in the "Plan of
Distribution" section of such prospectus in connection with a sale of any such
Exchange Securities received by such Exchanging Dealer pursuant to the
Registered Exchange Offer.
If, prior to the consummation of the Registered Exchange Offer, any
Holder holds any Securities acquired by it that have, or that are reasonably
likely to be determined to have, the status of an unsold allotment in an initial
distribution, or any Holder is not entitled to participate in the Registered
Exchange Offer, the Company and the Subsidiary Guarantors shall, upon the
request of any such Holder, simultaneously with the delivery of the Exchange
Securities in the Registered Exchange Offer, issue and deliver to any such
Holder, in exchange for the Securities held by such Holder (the "Private
Exchange"), a like aggregate principal amount of debt securities of the Company
(the "Private Exchange Securities") that are identical in all material respects
to the Exchange Securities, except for the transfer restrictions relating to
such Private Exchange Securities. The Private Exchange Securities will be issued
under the same indenture as the Exchange Securities, and the Company and the
Subsidiary Guarantors shall use their
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reasonable best efforts to cause the Private Exchange Securities to bear the
same CUSIP number as the Exchange Securities. The Private Exchange Securities,
however, will carry a restrictive legend.
In connection with the Registered Exchange Offer, the Company and
the Subsidiary Guarantors shall:
(a) mail to each Holder a copy of the prospectus forming part of the
Exchange Offer Registration Statement, together with an appropriate letter
of transmittal and related documents;
(b) keep the Registered Exchange Offer open for not less than 20
days (or longer, if required by applicable law) after the date on which
notice of the Registered Exchange Offer is mailed to the Holders;
(c) utilize the services of a depositary for the Registered Exchange
Offer with an address in the Borough of Manhattan, The City of New York;
(d) permit Holders to withdraw tendered Securities at any time prior
to the close of business, New York City time, on the last business day on
which the Registered Exchange Offer shall remain open; and
(e) otherwise comply in all respects with all laws that are
applicable to the Registered Exchange Offer.
As soon as practicable after the close of the Registered Exchange
Offer and any Private Exchange, as the case may be, the Company and the
Subsidiary Guarantors shall:
(a) accept for exchange all Securities tendered and not validly
withdrawn pursuant to the Registered Exchange Offer and the Private
Exchange;
(b) deliver to the Trustee for cancellation all Securities so
accepted for exchange; and
(c) cause the Trustee or the Exchange Securities Trustee, as the
case may be, promptly to authenticate and deliver to each Holder, Exchange
Securities or Private Exchange Securities, as the case may be, equal in
principal amount to the Securities of such Holder so accepted for
exchange.
The Company and the Subsidiary Guarantors shall use their respective
reasonable best efforts to keep the Exchange Offer Registration Statement
effective and to amend and supplement the prospectus contained therein in order
to permit such prospectus to be used by all persons subject to the prospectus
delivery requirements of the Securities Act for such period of time as such
persons must comply with such requirements in order to resell the Exchange
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Securities; provided that (i) in the case where such prospectus and any
amendment or supplement thereto must be delivered by an Exchanging Dealer, such
period shall be the lesser of 180 days and the date on which all Exchanging
Dealers have sold all Exchange Securities held by them and (ii) the Company and
the Subsidiary Guarantors shall make such prospectus and any amendment or
supplement thereto available to any broker-dealer for use in connection with any
resale of any Exchange Securities for a period of not less than 180 days after
the consummation of the Registered Exchange Offer.
The Indenture or the Exchange Securities Indenture, as the case may
be, shall provide that the Securities, the Exchange Securities and the Private
Exchange Securities shall vote and consent together on all matters as one class
and that none of the Securities, the Exchange Securities or the Private Exchange
Securities will have the right to vote or consent as a separate class on any
matter.
Interest on each Exchange Security and Private Exchange Security
issued pursuant to the Registered Exchange Offer and in the Private Exchange
will accrue from the last interest payment date on which interest was paid on
the Securities surrendered in exchange therefor or, if no interest has been paid
on the Securities, from the Issue Date.
Each Holder participating in the Registered Exchange Offer shall be
required to represent to the Company and the Subsidiary Guarantors that at the
time of the consummation of the Registered Exchange Offer (i) any Exchange
Securities received by such Holder will be acquired in the ordinary course of
business, (ii) such Holder will have no arrangements or understanding with any
person to participate in the distribution of the Securities or the Exchange
Securities within the meaning of the Securities Act and (iii) such Holder is not
an affiliate of the Company or of the Subsidiary Guarantors or, if it is such an
affiliate, such Holder will comply with the registration and prospectus delivery
requirements of the Securities Act to the extent applicable.
Notwithstanding any other provisions hereof, the Company and the
Subsidiary Guarantors will ensure that (i) any Exchange Offer Registration
Statement and any amendment thereto and any prospectus forming part thereof and
any supplement thereto complies in all material respects with the Securities Act
and the rules and regulations of the Commission thereunder, (ii) any Exchange
Offer Registration Statement and any amendment thereto does not, when it becomes
effective, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading and (iii) any prospectus forming part of any Exchange
Offer Registration Statement, and any supplement to such prospectus, does not,
as of the consummation of the Registered Exchange Offer, include an untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading.
2 Shelf Registration. If (i) because of any change in law or
applicable interpretations thereof by the Commission's staff the Company and the
Subsidiary Guarantors are
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not permitted to effect the Registered Exchange Offer as contemplated by Section
1 hereof, or (ii) any Securities validly tendered pursuant to the Registered
Exchange Offer are not exchanged for Exchanged Securities within 180 days after
the Issue Date, or (iii) any Initial Purchaser so requests with respect to
Securities or Private Exchange Securities not eligible to be exchanged for
Exchange Securities in the Registered Exchange Offer and held by it following
the consummation of the Registered Exchange Offer, or (iv) any applicable law or
interpretations do not permit any Holder to participate in the Registered
Exchange Offer, or (v) any Holder that participates in the Registered Exchange
Offer does not receive freely transferable Exchange Securities in exchange for
tendered Securities, or (vi) the Company and the Subsidiary Guarantors so elect,
then the following provisions shall apply:
(a) The Company and the Subsidiary Guarantors shall within 90 days
of receipt of written notice thereof (such date of receipt, the "Shelf
Notice Date") file with the Commission, and thereafter shall use their
respective reasonable best efforts to cause to be declared effective, a
shelf registration statement on an appropriate form under the Securities
Act relating to the offer and sale of the Transfer Restricted Securities
by the Holders thereof from time to time in accordance with the methods of
distribution set forth in such registration statement (hereafter, a "Shelf
Registration Statement" and, together with any Exchange Offer Registration
Statement, a "Registration Statement").
(b) The Company and the Subsidiary Guarantors shall use their
respective reasonable best efforts to keep the Shelf Registration
Statement continuously effective in order to permit the prospectus forming
part thereof to be used by Holders of Transfer Restricted Securities for a
period of two years from the Issue Date or such shorter period that will
terminate when all the Transfer Restricted Securities covered by the Shelf
Registration Statement have been sold pursuant thereto (in any such case,
such period being called the "Shelf Registration Period"). The Company and
the Subsidiary Guarantors shall be deemed not to have used their
respective reasonable best efforts to keep the Shelf Registration
Statement effective during the requisite period if they voluntarily take
any action that would result in Holders of Transfer Restricted Securities
covered thereby not being able to offer and sell such Transfer Restricted
Securities during that period, unless such action is required by
applicable law.
(c) Notwithstanding any other provisions hereof, the Company and the
Subsidiary Guarantors will ensure that (i) any Shelf Registration
Statement and any amendment thereto and any prospectus forming part
thereof and any supplement thereto complies in all material respects with
the Securities Act and the rules and regulations of the Commission
thereunder, (ii) any Shelf Registration Statement and any amendment
thereto (in either case, other than with respect to information included
therein in reliance upon or in conformity with written information
furnished to the Company and the Subsidiary Guarantors by or on behalf of
any Holder specifically for use therein (the "Holders' Information")) does
not, when it becomes effective, contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and (iii) any
prospectus forming part of
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any Shelf Registration Statement, and any supplement to such prospectus
(in either case, other than with respect to Holders' Information), does
not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
3 Liquidated Damages. (a) The parties hereto agree that the Holders
of Transfer Restricted Securities will suffer damages if the Company or the
Subsidiary Guarantors fail to fulfill their respective obligations under Section
1 or Section 2, as applicable, and that it would not be feasible to ascertain
the extent of such damages. Accordingly, if (i) the Exchange Offer Registration
Statement or the Shelf Registration Statement, as the case may be, is not filed
with the Commission on or prior to 90 days after the Issue Date or the Shelf
Notice Date, as the case may be, (ii) the Exchange Offer Registration Statement
or the Shelf Registration Statement, as the case may be, is not declared
effective within 150 days after the Issue Date or the Shelf Notice Date, as the
case may be, (iii) the Registered Exchange Offer is not consummated on or prior
to 180 days after the Issue Date, or (iv) the Shelf Registration Statement is
filed and declared effective within 90 days after the Shelf Notice Date but
shall thereafter cease to be effective (at any time that the Company and the
Subsidiary Guarantors are obligated to maintain the effectiveness thereof)
without being succeeded within 90 days by an additional Registration Statement
filed and declared effective (each such event referred to in clauses (i) through
(iv), a "Registration Default"), the Company and the Subsidiary Guarantors will
be obligated to pay liquidated damages to each Holder of Transfer Restricted
Securities, during the period of one or more such Registration Defaults, in an
amount equal to $0.192 per week per $1,000 principal amount of Transfer
Restricted Securities held by such Holder until (i) the applicable Registration
Statement is filed, (ii) the Exchange Offer Registration Statement is declared
effective, (iii) the Registered Exchange Offer is consummated, (iv) the Shelf
Registration Statement is declared effective or (v) the Shelf Registration
Statement again becomes effective, as the case may be. Following the cure of all
Registration Defaults, the accrual of liquidated damages will cease. As used
herein, the term "Transfer Restricted Securities" means (i) each Security until
the date on which such Security has been exchanged for a freely transferable
Exchange Security in the Registered Exchange Offer, (ii) each Security or
Private Exchange Security until the date on which it has been effectively
registered under the Securities Act and disposed of in accordance with the Shelf
Registration Statement or (iii) each Security or Private Exchange Security until
the date on which it is distributed to the public pursuant to Rule 144 under the
Securities Act or is saleable pursuant to Rule 144(k) under the Securities Act.
Notwithstanding anything to the contrary in this Section 3(a), the Company and
the Subsidiary Guarantors shall not be required to pay liquidated damages to a
Holder of Transfer Restricted Securities if such Holder failed to comply with
its obligations to make the representations set forth in the second to last
paragraph of Section 1 or failed to provide the information required to be
provided by it, if any, pursuant to Section 4(n).
(b) The Company shall notify the Trustee and the Paying Agent under
the Indenture immediately upon the happening of each and every Registration
Default. The Company and the Subsidiary Guarantors shall pay the liquidated
damages due on the Transfer Restricted Securities by depositing with the Paying
Agent (which may not be the Company for
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these purposes), in trust, for the benefit of the Holders thereof, prior to
10:00 a.m., New York City time, on the next interest payment date specified by
the Indenture and the Securities, sums sufficient to pay the liquidated damages
then due. The liquidated damages due shall be payable on each interest payment
date specified by the Indenture and the Securities to the record holder entitled
to receive the interest payment to be made on such date. Each obligation to pay
liquidated damages shall be deemed to accrue from and including the date of the
applicable Registration Default.
(c) The parties hereto agree that the liquidated damages provided
for in this Section 3 constitute a reasonable estimate of and are intended to
constitute the sole damages that will be suffered by Holders of Transfer
Restricted Securities by reason of the failure of (i) the Shelf Registration
Statement or the Exchange Offer Registration Statement to be filed, (ii) the
Shelf Registration Statement to remain effective or (iii) the Exchange Offer
Registration Statement to be declared effective and the Registered Exchange
Offer to be consummated, in each case to the extent required by this Agreement.
4 Registration Procedures. In connection with any Registration
Statement, the following provisions shall apply:
(a) The Company and the Subsidiary Guarantors shall (i) furnish to
each Initial Purchaser, prior to the filing thereof with the Commission, a copy
of the Registration Statement and each amendment thereof and each supplement, if
any, to the prospectus included therein and shall use their respective
reasonable best efforts to reflect in each such document, when so filed with the
Commission, such comments as any Initial Purchaser may reasonably propose; (ii)
include the information set forth in Annex A hereto on the cover, in Annex B
hereto in the "Exchange Offer Procedures" section and the "Purpose of the
Exchange Offer" section and in Annex C hereto in the "Plan of Distribution"
section of the prospectus forming a part of the Exchange Offer Registration
Statement, and include the information set forth in Annex D hereto in the Letter
of Transmittal delivered pursuant to the Registered Exchange Offer; and (iii) if
requested by any Initial Purchaser, include the information required by Items
507 or 508 of Regulation S-K, as applicable, in the prospectus forming a part of
the Exchange Offer Registration Statement.
(b) The Company and the Subsidiary Guarantors shall advise each
Initial Purchaser and the Holders (if applicable) (which in the case of clauses
(i) and (ii) below, such advisement shall be rendered only upon request of
Holders other than the Initial Purchasers) and, if requested by any such person,
confirm such advice in writing (which advice pursuant to clauses (ii)-(v) hereof
shall be accompanied by an instruction to suspend the use of the prospectus
until the requisite changes have been made):
(i) when any Registration Statement and any amendment thereto has
been filed with the Commission and when such Registration Statement or any
post-effective amendment thereto has become effective;
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(ii) of any request by the Commission for amendments or supplements
to any Registration Statement or the prospectus included therein or for
additional information;
(iii) of the issuance by the Commission of any stop order suspending
the effectiveness of any Registration Statement or the initiation of any
proceedings for that purpose;
(iv) of the receipt by the Company or the Subsidiary Guarantors of
any notification with respect to the suspension of the qualification of
the Securities, the Exchange Securities or the Private Exchange Securities
for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose; and
(v) of the happening of any event that requires the making of any
changes in any Registration Statement or the prospectus included therein
in order that the statements therein are not misleading and do not omit to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading.
(c) The Company and the Subsidiary Guarantors will make every
reasonable effort to obtain the withdrawal at the earliest possible time of any
order suspending the effectiveness of any Registration Statement.
(d) The Company and the Subsidiary Guarantors will furnish to each
Holder of Transfer Restricted Securities included within the coverage of any
Shelf Registration Statement, without charge, at least one conformed copy of
such Shelf Registration Statement and any post-effective amendment thereto,
including financial statements and schedules and, if any such Holder so requests
in writing, all exhibits thereto (including those, if any, incorporated by
reference).
(e) The Company and the Subsidiary Guarantors will, during the Shelf
Registration Period, promptly deliver to each Holder of Transfer Restricted
Securities included within the coverage of any Shelf Registration Statement,
without charge, as many copies of the prospectus (including each preliminary
prospectus) included in such Shelf Registration Statement and any amendment or
supplement thereto as such Holder may reasonably request; and the Company and
the Subsidiary Guarantors consent to the use of such prospectus or any amendment
or supplement thereto by each of the selling Holders of Transfer Restricted
Securities in connection with the offer and sale of the Transfer Restricted
Securities covered by such prospectus or any amendment or supplement thereto.
(f) The Company and the Subsidiary Guarantors will furnish to each
Initial Purchaser and each Exchanging Dealer, and to any other Holder who so
requests, without charge, at least one conformed copy of the Exchange Offer
Registration Statement and any post-effective amendment thereto, including
financial statements and schedules and, if any Initial Purchaser or Exchanging
Dealer or any such Holder so requests in writing, all exhibits thereto
(including those, if any, incorporated by reference).
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(g) The Company and the Subsidiary Guarantors will, during the
Exchange Offer Registration Period or the Shelf Registration Period, as
applicable, promptly deliver to each Initial Purchaser, each Exchanging Dealer
and such other persons that are required to deliver a prospectus following the
Registered Exchange Offer, without charge, as many copies of the final
prospectus included in the Exchange Offer Registration Statement or the Shelf
Registration Statement and any amendment or supplement thereto as such Initial
Purchaser, Exchanging Dealer or other persons may reasonably request; and the
Company and the Subsidiary Guarantors consent to the use of such prospectus or
any amendment or supplement thereto by any such Initial Purchaser, Exchanging
Dealer or other persons, as applicable, as aforesaid.
(h) Prior to the effective date of any Registration Statement, the
Company and the Subsidiary Guarantors will use their respective reasonable best
efforts to register or qualify, or cooperate with the Holders of Securities,
Exchange Securities or Private Exchange Securities included therein and their
respective counsel in connection with the registration or qualification of, such
Securities, Exchange Securities or Private Exchange Securities for offer and
sale under the securities or blue sky laws of such jurisdictions as any such
Holder reasonably requests in writing and do any and all other acts or things
necessary or advisable to enable the offer and sale in such jurisdictions of the
Securities, Exchange Securities or Private Exchange Securities covered by such
Registration Statement; provided that the Company and the Subsidiary Guarantors
will not be required to qualify generally to do business in any jurisdiction
where it is not then so qualified or to take any action which would subject it
to general service of process or to taxation in any such jurisdiction where it
is not then so subject.
(i) The Company and the Subsidiary Guarantors will cooperate with
the Holders of Securities, Exchange Securities or Private Exchange Securities to
facilitate the timely preparation and delivery of certificates representing
Securities, Exchange Securities or Private Exchange Securities to be sold
pursuant to any Registration Statement free of any restrictive legends and in
such denominations and registered in such names as the Holders thereof may
request in writing prior to sales of Securities, Exchange Securities or Private
Exchange Securities pursuant to such Registration Statement.
(j) If any event contemplated by Section 4(b)(ii) through (v) occurs
during the period for which the Company and the Subsidiary Guarantors are
required to maintain an effective Registration Statement, the Company and the
Subsidiary Guarantors will promptly prepare and file with the Commission a
post-effective amendment to the Registration Statement or a supplement to the
related prospectus or file any other required document so that, as thereafter
delivered to purchasers of the Securities, Exchange Securities or Private
Exchange Securities from a Holder, the prospectus will not include an untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading.
(k) Not later than the effective date of the applicable Registration
Statement, the Company and the Subsidiary Guarantors will provide a CUSIP number
for the Securities, the
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Exchange Securities and the Private Exchange Securities, as the case may be, and
provide the applicable trustee with printed certificates for the Securities, the
Exchange Securities or the Private Exchange Securities, as the case may be, in a
form eligible for deposit with The Depository Trust Company.
(l) The Company and the Subsidiary Guarantors will comply with all
applicable rules and regulations of the Commission and will make generally
available to its security holders as soon as practicable after the effective
date of the applicable Registration Statement an earning statement satisfying
the provisions of Section 11(a) of the Securities Act; provided that in no event
shall such earning statement be delivered later than 45 days after the end of a
12-month period (or 90 days, if such period is a fiscal year) beginning with the
first month of the Company's or the Subsidiary Guarantors' first fiscal quarter
commencing after the effective date of the applicable Registration Statement,
which statement shall cover such 12-month period.
(m) The Company and the Subsidiary Guarantors will cause the
Indenture or the Exchange Securities Indenture, as the case may be, to be
qualified under the Trust Indenture Act as required by applicable law in a
timely manner.
(n) The Company and the Subsidiary Guarantors may require each
Holder of Transfer Restricted Securities to be registered pursuant to any Shelf
Registration Statement to furnish to the Company and the Subsidiary Guarantors
such information concerning the Holder and the distribution of such Transfer
Restricted Securities as the Company and the Subsidiary Guarantors may from time
to time reasonably require for inclusion in such Shelf Registration Statement,
and the Company and the Subsidiary Guarantors may exclude from such registration
the Transfer Restricted Securities of any Holder that fails to furnish such
information within a reasonable time after receiving such request.
(o) In the case of a Shelf Registration Statement, each Holder of
Transfer Restricted Securities to be registered pursuant thereto agrees by
acquisition of such Transfer Restricted Securities that, upon receipt of any
notice from the Company or the Subsidiary Guarantors pursuant to Section
4(b)(ii) through (v), such Holder will discontinue disposition of such Transfer
Restricted Securities until such Holder's receipt of copies of the supplemental
or amended prospectus contemplated by Section 4(j) or until advised in writing
(the "Advice") by the Company and the Subsidiary Guarantors that the use of the
applicable prospectus may be resumed. If the Company or the Subsidiary
Guarantors shall give any notice under Section 4(b)(ii) through (v) during the
period that the Company and the Subsidiary Guarantors are required to maintain
an effective Registration Statement (the "Effectiveness Period"), such
Effectiveness Period shall be extended by the number of days during such period
from and including the date of the giving of such notice to and including the
date when each seller of Transfer Restricted Securities covered by such
Registration Statement shall have received (x) the copies of the supplemental or
amended prospectus contemplated by Section 4(j) (if an amended or supplemental
prospectus is required) or (y) the Advice (if no amended or supplemental
prospectus is required).
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(p) In the case of a Shelf Registration Statement, the Company and
the Subsidiary Guarantors shall enter into such customary agreements (including,
if requested, an underwriting agreement in customary form) and take all such
other action, if any, as Holders of a majority in aggregate principal amount of
the Securities, Exchange Securities and Private Exchange Securities being sold
or the managing underwriters (if any) shall reasonably request in order to
facilitate any disposition of Securities, Exchange Securities or Private
Exchange Securities pursuant to such Shelf Registration Statement.
(q) In the case of a Shelf Registration Statement, the Company and
the Subsidiary Guarantors shall (i) make reasonably available for inspection by
a representative of, and Special Counsel (as defined below) acting for, Holders
of a majority in aggregate principal amount of the Securities, Exchange
Securities and Private Exchange Securities being sold and any underwriter
participating in any disposition of Securities, Exchange Securities or Private
Exchange Securities pursuant to such Shelf Registration Statement, all relevant
financial and other records, pertinent corporate documents and properties of the
Company and its subsidiaries and (ii) use their respective reasonable best
efforts to have its officers, directors, employees, accountants and counsel
supply all relevant information reasonably requested by such representative,
Special Counsel or any such underwriter (an "Inspector") in connection with such
Shelf Registration Statement.
(r) In the case of a Shelf Registration Statement, the Company and
the Subsidiary Guarantors shall, if requested by Holders of a majority in
aggregate principal amount of the Securities, Exchange Securities and Private
Exchange Securities being sold, their Special Counsel or the managing
underwriters (if any) in connection with such Shelf Registration Statement, use
their respective reasonable best efforts to cause (i) their counsel to deliver
an opinion relating to the Shelf Registration Statement and the Securities,
Exchange Securities or Private Exchange Securities, as applicable, in customary
form, (ii) their officers to execute and deliver all customary documents and
certificates requested by Holders of a majority in aggregate principal amount of
the Securities, Exchange Securities and Private Exchange Securities being sold,
their Special Counsel or the managing underwriters (if any) and (iii) their
independent public accountants to provide a comfort letter in customary form,
subject to receipt of appropriate documentation as contemplated, and only if
permitted, by Statement of Auditing Standards No. 72.
5 Registration Expenses. The Company and the Subsidiary Guarantors
will bear all expenses incurred in connection with the performance of their
obligations under Sections 1, 2, 3 and 4 and the Company and the Subsidiary
Guarantors will reimburse the Initial Purchasers and the Holders for the
reasonable fees and disbursements of one firm of attorneys (in addition to any
local counsel) chosen by the Holders of a majority in aggregate principal amount
of the Securities, the Exchange Securities and the Private Exchange Securities
to be sold pursuant to each Registration Statement (the "Special Counsel")
acting for the Initial Purchasers or Holders in connection therewith.
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6 Indemnification. (a) In the event of a Shelf Registration
Statement or in connection with any prospectus delivery pursuant to an Exchange
Offer Registration Statement by an Initial Purchaser or Exchanging Dealer, as
applicable, the Company and the Subsidiary Guarantors shall indemnify and hold
harmless each Holder (including, without limitation, any such Initial Purchaser
or Exchanging Dealer), its affiliates, their respective officers, directors,
employees, representatives and agents, and each person, if any, who controls
such Holder within the meaning of the Securities Act or the Exchange Act
(collectively referred to for purposes of this Section 6 and Section 7 as a
Holder) from and against any loss, claim, damage or liability, joint or several,
or any action in respect thereof (including, without limitation, any loss,
claim, damage, liability or action relating to purchases and sales of the
Securities, Exchange Securities or Private Exchange Securities), to which that
Holder may become subject, whether commenced or threatened, under the Securities
Act, the Exchange Act, any other federal or state statutory law or regulation,
at common law or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained in any such Registration Statement
or any prospectus forming part thereof or in any amendment or supplement thereto
or (ii) the omission or alleged omission to state therein a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, and shall reimburse each Holder promptly upon demand for any legal
or other expenses reasonably incurred by that Holder in connection with
investigating or defending or preparing to defend against or appearing as a
third party witness in connection with any such loss, claim, damage, liability
or action as such expenses are incurred; provided, however, that the Company and
the Subsidiary Guarantors shall not be liable in any such case to the extent
that any such loss, claim, damage, liability or action arises out of, or is
based upon, an untrue statement or alleged untrue statement in or omission or
alleged omission from any of such documents in reliance upon and in conformity
with any Holders' Information; and provided, further, that with respect to any
such untrue statement in or omission from any related preliminary prospectus,
the indemnity agreement contained in this Section 6(a) shall not inure to the
benefit of any Holder from whom the person asserting any such loss, claim,
damage, liability or action received Securities, Exchange Securities or Private
Exchange Securities to the extent that such loss, claim, damage, liability or
action of or with respect to such Holder results from the fact that both (A) a
copy of the final prospectus was not sent or given to such person at or prior to
the written confirmation of the sale of such Securities, Exchange Securities or
Private Exchange Securities to such person and (B) the untrue statement in or
omission from the related preliminary prospectus was corrected in the final
prospectus unless, in either case, such failure to deliver the final prospectus
was a result of non-compliance by the Company or the Subsidiary Guarantors with
Section 4(d), 4(e), 4(f) or 4(g).
(b) In the event of a Shelf Registration Statement, each Holder
shall indemnify and hold harmless the Company, the Subsidiary Guarantors, their
affiliates, their respective officers, directors, employees, representatives and
agents, and each person, if any, who controls the Company and the Subsidiary
Guarantors within the meaning of the Securities Act or the Exchange Act
(collectively referred to for purposes of this Section 6(b) and Section 7 as the
Company and the Subsidiary Guarantors), from and against any loss, claim, damage
or liability,
13
joint or several, or any action in respect thereof, to which the Company and the
Subsidiary Guarantors may become subject, whether commenced or threatened, under
the Securities Act, the Exchange Act, any other federal or state statutory law
or regulation, at common law or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) any untrue statement or
alleged untrue statement of a material fact contained in any such Registration
Statement or any prospectus forming part thereof or in any amendment or
supplement thereto or (ii) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, but in each case only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with any Holders' Information furnished to
the Company by such Holder, and shall reimburse the Company and the Subsidiary
Guarantors for any legal or other expenses reasonably incurred by the Company
and the Subsidiary Guarantors in connection with investigating or defending or
preparing to defend against or appearing as a third party witness in connection
with any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that no such Holder shall be liable for any
indemnity claims hereunder in excess of the amount of net proceeds received by
such Holder from the sale of Securities, Exchange Securities or Private Exchange
Securities pursuant to such Shelf Registration Statement.
(c) Promptly after receipt by an indemnified party under this
Section 6 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party pursuant to Section 6(a) or 6(b), notify the indemnifying
party in writing of the claim or the commencement of that action; provided,
however, that the failure to notify the indemnifying party shall not relieve it
from any liability which it may have under this Section 6 except to the extent
that it has been materially prejudiced (through the forfeiture of substantive
rights or defenses) by such failure; and provided, further, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have to an indemnified party otherwise than under this Section 6. If any
such claim or action shall be brought against an indemnified party, and it shall
notify the indemnifying party thereof, the indemnifying party shall be entitled
to participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 6 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than the reasonable costs of investigation; provided, however,
that an indemnified party shall have the right to employ its own counsel in any
such action, but the fees, expenses and other charges of such counsel for the
indemnified party will be at the expense of such indemnified party unless (1)
the employment of counsel by the indemnified party has been authorized in
writing by the indemnifying party, (2) the indemnified party has reasonably
concluded (based upon advice of counsel to the indemnified party) that there may
be legal defenses available to it or other indemnified parties that are
different from or in addition to those available to the indemnifying party, (3)
a conflict or potential conflict exists
14
(based upon advice of counsel to the indemnified party) between the indemnified
party and the indemnifying party (in which case the indemnifying party will not
have the right to direct the defense of such action on behalf of the indemnified
party) or (4) the indemnifying party has not in fact employed counsel reasonably
satisfactory to the indemnified party to assume the defense of such action
within a reasonable time after receiving notice of the commencement of the
action, in each of which cases the reasonable fees, disbursements and other
charges of counsel will be at the expense of the indemnifying party or parties.
It is understood that the indemnifying party or parties shall not, in connection
with any proceeding or related proceedings in the same jurisdiction, be liable
for the reasonable fees, disbursements and other charges of more than one
separate firm of attorneys (in addition to any local counsel) at any one time
for all such indemnified party or parties. Each indemnified party, as a
condition of the indemnity agreements contained in Sections 6(a) and 6(b), shall
use all reasonable efforts to cooperate with the indemnifying party in the
defense of any such action or claim. No indemnifying party shall be liable for
any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment for the plaintiff in any such action,
the indemnifying party agrees to indemnify and hold harmless any indemnified
party from and against any loss or liability by reason of such settlement or
judgment. No indemnifying party shall, without the prior written consent of the
indemnified party (which consent shall not be unreasonably withheld), effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
7 Contribution. If the indemnification provided for in Section 6 is
unavailable or insufficient to hold harmless an indemnified party under Section
6(a) or 6(b), then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or liability, or action in respect
thereof, (i) in such proportion as shall be appropriate to reflect the relative
benefits received by the Company and the Subsidiary Guarantors from the offering
and sale of the Securities, on the one hand, and a Holder with respect to the
sale by such Holder of Securities, Exchange Securities or Private Exchange
Securities, on the other, or (ii) if the allocation provided by clause (i) above
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company and the Subsidiary Guarantors on the one hand
and such Holder on the other with respect to the statements or omissions that
resulted in such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations. The relative benefits
received by the Company and the Subsidiary Guarantors on the one hand and a
Holder on the other with respect to such offering and such sale shall be deemed
to be in the same proportion as the total net proceeds from the offering of the
Securities (before deducting expenses) received by or on behalf of the Company
and the Subsidiary Guarantors as set forth in the table on the cover of the
Offering Memorandum, on the one hand, bear to the total proceeds received by
such Holder with respect to its sale of Securities, Exchange Securities or
Private Exchange Securities, on the other. The relative fault shall be
determined by reference to, among
15
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to the
Company and the Subsidiary Guarantors or information supplied by the Company and
the Subsidiary Guarantors on the one hand or to any Holders' Information
supplied by such Holder on the other, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission. The parties hereto agree that it would not be
just and equitable if contributions pursuant to this Section 7 were to be
determined by pro rata allocation or by any other method of allocation that does
not take into account the equitable considerations referred to herein. The
amount paid or payable by an indemnified party as a result of the loss, claim,
damage or liability, or action in respect thereof, referred to above in this
Section 7 shall be deemed to include, for purposes of this Section 7, any legal
or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending or preparing to defend any such action or claim.
Notwithstanding the provisions of this Section 7, an indemnifying party that is
a Holder of Securities, Exchange Securities or Private Exchange Securities shall
not be required to contribute any amount in excess of the amount by which the
total price at which the Securities, Exchange Securities or Private Exchange
Securities sold by such indemnifying party to any purchaser exceeds the amount
of any damages which such indemnifying party has otherwise paid or become liable
to pay by reason of any untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
8 Rules 144 and 144A. The Company and the Subsidiary Guarantors
shall use their respective reasonable best efforts to file the reports required
to be filed by them under the Securities Act and the Exchange Act in a timely
manner and, if at any time the Company and the Subsidiary Guarantors are not
required to file such reports, it will, upon the written request of any Holder
of Transfer Restricted Securities, make publicly available other information so
long as necessary to permit sales of such Holder's securities pursuant to Rules
144 and 144A. The Company and the Subsidiary Guarantors covenant that they will
take such further action as any Holder of Transfer Restricted Securities may
reasonably request, all to the extent required from time to time to enable such
Holder to sell Transfer Restricted Securities without registration under the
Securities Act within the limitation of the exemptions provided by Rules 144 and
144A (including, without limitation, the requirements of Rule 144A(d)(4)). Upon
the written request of any Holder of Transfer Restricted Securities, the Company
shall deliver to such Holder a written statement as to whether it has complied
with such requirements. Notwithstanding the foregoing, nothing in this Section 8
shall be deemed to require the Company and the Subsidiary Guarantors to register
any of their securities pursuant to the Exchange Act.
9 Underwritten Registrations. If any of the Transfer Restricted
Securities covered by any Shelf Registration Statement are to be sold in an
underwritten offering, the investment banker or investment bankers and manager
or managers that will administer the offering will be selected by the Holders of
a majority in aggregate principal amount of such Transfer Restricted Securities
included in such offering, subject to the consent of the Company
16
(which shall not be unreasonably withheld or delayed), and such Holders shall be
responsible for all underwriting commissions and discounts in connection
therewith.
No person may participate in any underwritten registration hereunder
unless such person (i) agrees to sell such person's Transfer Restricted
Securities on the basis reasonably provided in any underwriting arrangements
approved by the persons entitled hereunder to approve such arrangements and (ii)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms
of such underwriting arrangements.
10 Miscellaneous. (a) Amendments and Waivers. The provisions of this
Agreement may not be amended, modified or supplemented, and waivers or consents
to departures from the provisions hereof may not be given, unless the Company
has obtained the written consent of Holders of a majority in aggregate principal
amount of the Securities, the Exchange Securities and the Private Exchange
Securities, taken as a single class. Notwithstanding the foregoing, a waiver or
consent to depart from the provisions hereof with respect to a matter that
relates exclusively to the rights of Holders whose Securities, Exchange
Securities or Private Exchange Securities are being sold pursuant to a
Registration Statement and that does not directly or indirectly affect the
rights of other Holders may be given by Holders of a majority in aggregate
principal amount of the Securities, the Exchange Securities and the Private
Exchange Securities being sold by such Holders pursuant to such Registration
Statement.
(b) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail,
telecopier or air courier guaranteeing next-day delivery:
(1) if to a Holder, at the most current address given by such Holder
to the Company in accordance with the provisions of this Section 10(b),
which address initially is, with respect to each Holder, the address of
such Holder maintained by the Registrar under the Indenture, with a copy
in like manner to Chase Securities Inc.;
(2) if to the Initial Purchasers, initially at their addresses set
forth in the Purchase Agreement; and
(3) if to the Company or the Subsidiary Guarantors, initially at the
addresses of the Company and the Subsidiary Guarantors set forth in the
Purchase Agreement.
All such notices and communications shall be deemed to have been
duly given: when delivered by hand, if personally delivered; one business day
after being delivered to a next-day air courier; five business days after being
deposited in the mail; and when receipt is acknowledged by the recipient's
telecopier machine, if sent by telecopier.
(c) Successors and Assigns. This Agreement shall be binding upon the
Company, the Subsidiary Guarantors and their successors and assigns.
17
(d) Counterparts. This Agreement may be executed in any number of
counterparts (which may be delivered in original form or by telecopier) and by
the parties hereto in separate counterparts, each of which when so executed
shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
(e) Definition of Terms. For purposes of this Agreement, (a) the
term "business day" means any day on which the New York Stock Exchange, Inc. is
open for trading, (b) the term "subsidiary" has the meaning set forth in Rule
405 under the Securities Act and (c) except where otherwise expressly provided,
the term "affiliate" has the meaning set forth in Rule 405 under the Securities
Act.
(f) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(g) Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.
(h) Remedies. In the event of a breach by the Company, and/or the
Subsidiary Guarantors, on the one hand, or by any Holder, on the other hand, of
any of their obligations under this Agreement, each Holder or the Company or the
Subsidiary Guarantors, as the case may be, in addition to being entitled to
exercise all rights granted by law, including recovery of damages (other than
the recovery of damages for a breach by the Company and/or the Subsidiary
Guarantors of their obligations under Sections 1 or 2 hereof for which
liquidated damages have been paid pursuant to Section 3 hereof), will be
entitled to specific performance of its rights under this Agreement. The
Company, the Subsidiary Guarantors and each Holder agree that monetary damages
would not be adequate compensation for any loss incurred by reason of a breach
by it of any of the provisions of this Agreement and hereby further agree that,
in the event of any action for specific performance in respect of such breach,
it shall waive the defense that a remedy at law would be adequate.
(i) No Inconsistent Agreements. The Company and each of the
Subsidiary Guarantors represents, warrants and agrees that (i) it has not
entered into, shall not, on or after the date of this Agreement, enter into any
agreement that is inconsistent with the rights granted to the Holders in this
Agreement or otherwise conflicts with the provisions hereof, (ii) it has not
previously entered into any agreement which remains in effect granting any
registration rights with respect to any of its debt securities to any person and
(iii) without limiting the generality of the foregoing, without the written
consent of the Holders of a majority in aggregate principal amount of the then
outstanding Transfer Restricted Securities, it shall not grant to any person the
right to request the Company to register any debt securities of the Company
under the Securities Act unless the rights so granted are not in conflict or
inconsistent with the provisions of this Agreement.
18
(j) No Piggyback on Registrations. Neither the Company, the
Subsidiary Guarantors nor any of their security holders (other than the Holders
of Transfer Restricted Securities in such capacity) shall have the right to
include any securities of the Company and the Subsidiary Guarantors in any Shelf
Registration or Registered Exchange Offer other than Transfer Restricted
Securities.
(k) Severability. The remedies provided herein are cumulative and
not exclusive of any remedies provided by law. If any term, provision, covenant
or restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, illegal, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated, and
the parties hereto shall use their reasonable best efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would have
executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or
unenforceable.
Please confirm that the foregoing correctly sets forth the agreement
among the Company, the Subsidiary Guarantors and the Initial Purchasers.
Very truly yours,
AVIS RENT A CAR, INC.
By _____________________________________
Name:
Title:
AVIS RENT A CAR SYSTEM, INC.
By _____________________________________
Name:
Title:
AVIS INTERNATIONAL, LTD.
By _____________________________________
19
Name:
Title:
AVIS MANAGEMENT SERVICES, LTD.
By _____________________________________
Name:
Title:
AVIS CARIBBEAN, LIMITED
By _____________________________________
Name:
Title:
AVIS ASIA AND PACIFIC, LIMITED
By _____________________________________
Name:
Title:
AVIS ENTERPRISES, INC.
By _____________________________________
Name:
Title:
AVIS SERVICE, INC.
By _____________________________________
Name:
Title:
AVIS LUBE, INC.
By _____________________________________
Name:
Title:
AVIS LEASING CORPORATION
By _____________________________________
Name:
Title:
RENT-A-CAR COMPANY, INCORPORATED
By _____________________________________
Name:
Title:
RESERVE CLAIMS MANAGEMENT CO.
By _____________________________________
Name:
Title:
AVIS FLEET LEASING AND MANAGEMENT
CORPORATION
By _____________________________________
Name:
Title:
PHH VEHICLE MANAGEMENT SERVICES LLC
By _____________________________________
Name:
Title:
DEALERS HOLDINGS, INC.
By _____________________________________
Name:
Title:
WILLIAMSBURG MOTORS, INC.
By _____________________________________
Name:
Title:
EDENTON MOTORS, INC.
By _____________________________________
Name:
Title:
XXXXXX EXPRESS LLC
By _____________________________________
Name:
Title:
PHH CANADIAN HOLDINGS, INC.
By _____________________________________
Name:
Title:
PHH DEUTSCHLAND, INC.
By _____________________________________
Name:
Title:
23
Accepted:
CHASE SECURITIES INC.
By_________________________________
Authorized Signatory
Address for notices pursuant to Section 9(c):
Xxx Xxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Legal Department
XXXXXX BROTHERS INC.
By_________________________________
Authorized Signatory
Address for notices pursuant to Section9(c):
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Legal Department
