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[Certain portions of this Exhibit have been omitted pursuant to a request for
confidential treatment as indicated by an * and separately filed with the
Commission]
General Motors Corporation
[LOGO]
NAO Fleet Operations
December 16, 1998
Xx. Xxxxx Xxxxxx
Vice President - Fleet Operations
Automotive Rental Group
Republic Industries, Inc.
000 X. X. 6th Street
Ft. Lauderdale, FL 33301
Dear Xx. Xxxxxx:
This letter will confirm the agreement ("Agreement") reached between Alamo Rent
A Car, Inc. ("Alamo") and General Motors ("GM") regarding Alamo's purchase or
lease of GM vehicles for model year 1999 through model year 2002.
The details of this Agreement are as follows:
1999 MODEL YEAR
---------------
1. Alamo will purchase or lease from GM dealers of their choice a * 1999 model
GM vehicles under the terms and conditions of GM's 1999 Model Year Daily Rental
Purchase Program (refer ATTACHMENT 1). Alamo has agreed to purchase these GM
vehicles in a mix which includes a considerable number of GM's higher priced
models and which represents a higher percentage of these units than Alamo
otherwise would purchase. The agreed mix of units is as follows:
Metro * Eighty Eight *
Cavalier * Park Avenue *
Cavalier Cvt. * DeVille *
Sunfire * Camaro *
Sunfire Cvt. * Venture *
Grand Am * Trans Sport *
Alero * Silhouette *
Malibu * Astro van *
Cutlass * Safari van *
Century * Blazer *
Lumina * Xxxxx *
Monte Carlo * Bravada *
Grand Prix * Full Size Van *
Bonneville * Tahoe/Yukon *
LeSabre * Suburban *
Intrigue * Total Units *
General Motors Corporation
[LOGO]
RENAISSANCE CENTER TOWER 100, 11TH FLOOR 000-000-0000
MAIL CODE 482-A11-B96 DETROIT, MI 00000-0000 FAX 000-000-0000
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2. x. Xxxxx agrees * the following 1999MY units from the 1999 CY into the
1998 CY: *
b. *
3. GM agrees to offer Alamo the availability of the YT1/YT2 short term
programs for vehicles described in Paragraph 1. Refer to ATTACHMENT 4
AND 5 for program parameters.
4. Alamo agrees that in all advertising and promotional materials which
Alamo undertakes for the 1999 Model Year (September 1, 1998 through
August 31, 1999), Alamo will feature only General Motors products where
any vehicle is featured or promoted. During the term of this Agreement,
Alamo agrees to allow such space and include such tag lines as is in
accordance with the customer of the trade and industry.
5. In exchange for this Agreement to purchase, promote and service the
number of 1999 models and in a vehicle mix satisfactory to GM, as
described in Paragraph 1, GM will provide Alamo * in addition to any
incentives due under the terms and conditions of GM's 1999 Model Year
Daily Rental Purchase Program.
6. The * by the 25th day of the month following vehicle delivery and
receipt of a diskette/electronic media transmission by GM provided GM
receives Alamo's diskette/electronic media transmission by the last
business day of the month. A diskette/electronic media transmission
received after the last business day of the month * by the 25th of the
following month. This diskette/electronic media transmission must
include VIN numbers on the portion of * in the preceding month and not
covered in *. ATTACHMENT 2 details data transmission and record format
requirements and should be used when reporting vehicle acquisitions.
The report of vehicle acquisitions should be transmitted by EDS Elite
to the GM Auction Sales and Remarketing Department or diskettes sent to
the following address:
Attention: X. X. Xxxxxx, Director - Finance
NAO Fleet Operations
Renaissance Center
Tower 000, 00xx xxxxx
XX 000-X00-X00
Xxxxxxx, Xxxxxxxx 48265-1000
In the event that Alamo does not purchase or lease the agreed number of
vehicles at the agreed mix, * Alamo as described in Paragraph 6 by
General Motors * GM on demand subject to Paragraph 8.
7. GM agrees to make the *, as described in Paragraph 5, available to
Alamo through GM's *; otherwise GM will mail * to Alamo on the due date
stated in Paragraph 6. The provisions of GM's * to be available to
Alamo three (3) calendar days from the time period specified in
Paragraph 6. * For example, if * is Wednesday, the 25th of the month, *
would normally be scheduled for Saturday, the 28th. *
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8. All volume and mix requirements are subject to reasonable minor
adjustments based upon mutual agreement between the parties when the
exact circumstances faced by both parties are known at the time of
vehicle delivery. It is understood that these adjustments may require
Alamo to purchase a comparably priced mix of product. In the event that
either party cannot fulfill any terms of this Agreement due to events
beyond its control, such as acts of God, labor disputes, and severe
economic downturns, the parties will enter negotiations with the intent
of allowing both to continue business without substantial penalty.
9. Alamo agrees to provide to GM, at the beginning of each month, a
schedule of anticipated purchases of 1999 model year vehicles (model
year fleet plan) by division and car line, by month and model year.
Alamo also agrees to provide to GM, at the end of each month, a
schedule of 1998 and 1999 model vehicle returns by vehicle size (e.g.,
economy, midsize, etc.) by month of the 1998 and 1999 calendar years.
*
10. Alamo agrees to retain any documents or records relevant to vehicles
purchased under this Agreement or any GM program and/or claims * or any
other GM program for two years after the close of the program. Alamo
agrees to permit any designated representative of GM to examine, audit
and take copies of any accounts and records Alamo is to maintain under
this Agreement. Alamo agrees to make such accounts and records readily
available at its facilities during regular business hours. GM agrees to
furnish Alamo with a list of any reproduced records.
GM agrees to assist Alamo in vehicle financing by providing the following at the
request of Alamo:
a. *
b. GM agrees to execute an amendment to the General Motors Corporation
Repurchase Agreement dated August 22, 1994, as amended from time to
time, in order to clarify that GM's obligations thereunder will be
applicable to 1999 through 2000 model year vehicles. The terms of
the GM Daily Rental Purchase Guidelines and the GM National Fleet
Purchase Program Guidelines for the 1999 model year will be
incorporated into the amendment.
MODEL YEARS 1999 THROUGH 2002
This letter will also confirm the Agreement reached between Alamo and GM
regarding Alamo's purchase or lease GM vehicles for model year 1999 through
model year 2002. The details of this Agreement are as follows:
11. GM agrees to extend the terms and conditions of GM's 1999 Model Year
Daily Rental Fleet Program (refer ATTACHMENT 1) for model year 1999
through model year 2000.
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GM reserves the right to place "new" models (as defined by GM) on any
of the four (4) 1998 MY repurchase percentage tiers or create a new
tier. Additionally, GM also reserves the right to shift vehicles only
to higher percentage tiers, (e.g. shift from repurchase tier 1 to tier
2, thus lowering Alamo's vehicle depreciation cost).
Notwithstanding the above items, should GM alter the terms and
conditions of its vehicle purchase program, then Alamo would be granted
the option of choosing which program is more beneficial to its
business.
12. GM agrees to commit to Alamo the availability of the 100% Vehicle
Purchase Program through model year 2002.
13. GM agrees that Alamo may purchase or lease from GM dealers of its
choice a * during each model year of this Agreement. GM and Alamo agree
that the vehicle mix and production timing provided in future model
years must be mutually satisfactory to both parties.
14. Alamo agrees to maintain a minimum GM share penetration of 51%. The 51%
GM share penetration can be measured as a percent of acquisitions or as
a percent of fleet months. Further, during the term of this Agreement,
Alamo agrees that all advertising and promotional materials which Alamo
undertakes for future model years, Alamo will feature only General
Motors products where any vehicle is featured or promoted. Accordingly,
Alamo agrees to allow such space and include such tag lines as in
accordance with the custom of the trade and industry. In exchange, GM
will provide Alamo with * during each year of this Agreement. These
sums are in addition to any Incentives due under the terms and
conditions of GM's Model Year Daily Rental Fleet Programs, if any are
available.
15. This agreement is confidential and proprietary of General Motors and is
intended for the sole use by GM and Alamo. Failure to maintain
confidentiality of the terms of this a agreement may result in loss of
Fleet Authorization privileges with regard to future purchases.
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On behalf of the General Motors' Car and Truck Divisions, I would like to
express my appreciation for your business and hope this Agreement will continue
to strengthen our business relationship.
Very truly yours,
/s/ Xxxxxxx X. Xxx
---------------------------------
X. X. Xxx
Executive Director
Fleet Operations
/s/ Xxxxx Xxxxxx
--------------------------------
Acknowledged and Agreed
Republic Industries, Inc.
Date: December 18, 1998
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