WIZARD NOTE ASSUMPTION AND RELEASE AGREEMENT
This Wizard Note Assumption and Release Agreement is made as
of the 30th day of July, 1997 by and between Wizard Co., Inc., a Delaware
Corporation ("Wizard"), Avis Rent A Car System, Inc., a Delaware Corporation
("ARACS") and Reserve Claims Management Co., a Delaware Corporation ("Reserve
Claims Management"). Capitalized terms used but not otherwise defined herein
shall have the meaning assigned to such terms in the Separation Agreement
dated as of the date hereof by and between HFS Car Rental, Inc. and Avis Rent
A Car, Inc.(the "Separation Agreement").
WHEREAS, Wizard is the payor under the Wizard Note, a copy
of which is attached hereto as Exhibit A;
WHEREAS, in connection with the Separation and pursuant to
the Separation Agreement, ARACS has agreed to assume the liabilities and
obligations of Wizard under the Wizard Note; and
WHEREAS, Reserve Claims Management, as the payee under the
Wizard Note, has consented to the assumption by ARACS of the obligations under
the Wizard Note and has agreed to release Wizard from its liabilities and
obligations thereunder.
NOW, THEREFORE, intending to be legally bound, the parties
hereto agree as follows:
1. Assumption. Effective as of the date hereof, ARACS
hereby assumes the Wizard Note and agrees to perform and discharge
all liabilities and obligations of Wizard under the Wizard Note and
agrees to be bound by and comply with all terms and conditions of
the Wizard Note as if ARACS was an original signatory thereto such
that all references in the Wizard Note to the term "Wizard Co., Inc." shall be
deemed to refer to ARACS and not Wizard.
2. Consideration. Subject to Section 5.1 of the
Separation Agreement, Wizard agrees to pay ARACS $205,038,000 upon
execution hereof in consideration for ARACS's assumption of the
liabilities and obligations under the Wizard Note pursuant to
Section 1 above.
3. Release. Reserve Claims Management hereby consents
to the assumption of the Wizard Note as described in Section 1
above and agrees to release Wizard from any and all liabilities and
obligations under the Wizard Note.
4. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York.
5. Binding Agreement. This Agreement shall be binding
upon, and shall inure to the benefit of, the successors and assigns
of the parties hereto.
6. Counterparts. This Agreement may be executed in any
number of counterparts, each of which when taken together shall
constitute one and the same instrument.
-2-
IN WITNESS WHEREOF, the undersigned have executed and
delivered this Agreement as of the date first written above.
AVIS RENT A CAR SYSTEM, INC.
By: ___________________________
Name:
Title:
RESERVE CLAIMS MANAGEMENT, INC.
By: ___________________________
Name:
Title:
WIZARD CO., INC.
By: ___________________________
Name:
Title:
33157
-3-
EXHIBIT A
WIZARD CO., INC.
$194,100,000 October 1, 1996
WIZARD CO., INC., a Delaware corporation (the "Company"), hereby
promises to pay AVIS, INC., or its assigns, the principal amount of
$194,100,000 on October 1, 2006, with interest (computed on the basis of the
actual number of days elapsed over a 360 day year) on the unpaid balance of
such principal amount at a rate per annum equal to 7.13%, from the date hereof,
payable annually on each anniversary of the date of this Note, commencing on
October 1, 1997, until the principal hereof shall have become due and payable
(whether at maturity or at a date fixed for prepayment or by declaration or
otherwise) and with interest on any overdue principal (including any overdue
prepayment principal) and (to the extent permitted by applicable law) on any
overdue installment of interest, at a rate per annum equal to 9.13% or, at the
option of the holder hereof, such interest shall be payable on demand;
provided, that each installment of interest may be payable, at the sole
discretion of the Company, either in cash or by the issuance of promissory
notes of the Company substantially in the form of this Note; provided further,
that in no event shall the amount payable by the Company as interest on this
Note exceed the highest lawful rate permissible under any law applicable
hereto. Payments shall be overdue for purposes hereof if not made on the
originally scheduled date of payment therefor, without giving effect to any
applicable grace period. Payments of principal and interest hereon, to the
extent payable in cash, shall be made in lawful money of the United States of
America. All payments on this Note shall be made to the address for such
purpose specified in Schedule 1 attached hereto or to such other address as
the holder of this Note may designate in writing to the Company, without
requiring any presentation or surrender of this Note, except that if this Note
is paid or prepaid in full it shall be promptly surrendered to the Company and
canceled.
Section 1: Prepayment of Note
At any time, or from time to time, the Company may, at its option, prepay all
or any part (in an integral multiple of $1,000,000 or such lesser amount as
shall then be outstanding) of this Note.
Section 2: Events of Default; Remedies
Each of the following shall be an Event of Default under this Note:
(a) the Company defaults in the due and punctual payment of all or
any part of the principal of this Note when and as the same shall become due
and payable, whether at the stated maturity thereof, by notice of or demand
for prepayment, or otherwise;
(b) the Company defaults in the due and punctual payment of any
interest on this Note when and as such interest shall become due and payable
and such default shall have continued for a period of five consecutive days;
(c) the Company shall commence a voluntary case or other proceeding
seeking liquidation, reorganization or other relief with respect to itself or
its debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official for the Company or any
substantial part of its assets, or shall consent to any such relief or to the
appointment or taking possession by any such official in any involuntary case
or other proceeding commenced against it, or shall make a general assignment
for the benefit of creditors, or shall fail generally to pay its debts as they
become due, or shall take any corporate action to authorize any of the
foregoing; and
(d) an involuntary case or other proceeding shall be commenced
against the Company seeking liquidation, reorganization or other relief with
respect to it or its debts under any bankruptcy, insolvency or other similar
law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official for the Company or
any substantial part of its assets, and such involuntary case or other
proceeding shall remain undismissed and unstayed for a period of 30
consecutive days.
2
If an Event of Default specified in clauses (c) and (d) of this Section 2
shall occur, this Note shall automatically become immediately due and payable
together with interest accrued thereon, without presentment, demand, protest
or notice of any kind, all of which are hereby expressly waived.
If an Event of Default other than those specified in clauses (c) and (d) shall
occur, the holder of this Note may exercise any right, power or remedy
permitted to such holder by applicable law, and shall have, in particular,
without limiting the generality of the foregoing, the right to declare the
entire unpaid principal of, and interest accrued on, this Note then
outstanding to be, and this Note shall thereupon become, forthwith due and
payable, without any presentment, demand, protest, or other notice of any
kind, all of which are hereby expressly waived, and the Company shall
forthwith pay to the holder of this Note the entire unpaid principal of, and
interest accrued on, this Note.
No course of dealing on the part of the holder of this Note nor any delay or
failure on the part of the holder of this Note to exercise any rights shall
operate as a waiver of such right or otherwise prejudice the holder's rights,
powers and remedies. If the Company fails to comply with any provision of this
Note, the Company shall pay to the holder, to the extent permitted by
applicable law, such further amounts as shall be sufficient to cover the costs
and expenses, including but not limited to reasonable attorneys' fees,
incurred by the holder in collecting any sums due on this Note or in otherwise
assessing, analyzing or enforcing any rights or remedies that are or may be
available to the holder.
Section 3: Notices
The Company's address for all communications related to this Note shall be as
follows:
Wizard Co., Inc.
000 Xxx Xxxxxxx Xxxx
Xxxxxx Xxxx, XX 00000
Attention: General Counsel
or shall be otherwise as the Company may designate to the holder of this Note
in writing. The holder's address for all communications related to this Note
shall be as set forth on Schedule 1 attached hereto or shall be otherwise as
such holder or any subsequent holder of this Note may designate to the Company
in writing.
3
Section 4: Successors and Assigns
This Note shall inure to the benefit of and be binding upon the successors and
assigns of the holder and the Company. The provisions hereof are intended to
be for the benefit of any holder, from time to time, of this Note, and shall
be enforceable by any such holder, whether or not an express assignment to such
holder of such rights hereunder shall have been made by the holder or any
successor or assign.
Section 5: Governing Law
This Note shall be construed in accordance with and governed by the domestic
substantive laws of New York without giving effect to any choice of law or
conflicts of law provision or rule that would cause the application of the
domestic substantive laws of any other jurisdiction.
WIZARD CO., INC.
/s/ Xxxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: President and CEO
4
SCHEDULE 1
Avis, Inc.
000 Xxx Xxxxxxx Xxxx
Xxxxxx Xxxx, XX 00000
Attention: General Counsel
